A very wide range of issues were explored in the two focus groups held in Sydney on June 19. The discussions were seeded by some very early findings from the online survey. Very quickly a number of issues were added while others were dismissed or clarified.

In particular, issues related to collaboration, power, pro-bono resources and volunteering, capacity building and collaboration were raised.

a) Short-term funding imposed constraints on and had consequences for the sector. These included implications for:
• capacity building
• longer-term planning
• measurable impact
• sustainability

b) Expenses to income ratios were viewed differently by funders and L&Ms. Funders especially Governments recognized the need for direct and “core costs” funding. L&Ms in the SE were of the view that funding only core cost and not overheads and administration expenses effectively reduced impact.

c) According to L&Ms the accumulation of capital reserves was viewed unfavourably by funders (by their nature charities should disburse all funds they receive; public perception demands that this be done). But L&Ms were also of the view that accumulation of reserves was an indicator of growth, the health of an organization, and sustainability.

d) Probono resources were viewed differently within the sector. Business contribution in this area was seen to be the exercise of social responsibility (business skills mentors, provision of experts for short periods, voluntarism by business personnel etc….)

e) Capacity building was viewed as a process and outcome engaging several interrelated issues. There were clearly different views among SE L&Ms about business skills development and increased capacity where leveraging of an existing skill _base_ and importing ‘new’ business skills and capabilities (from the for-profit/business sector) were opposing views.

f) Collaboration was one of the highest rated issues for L&Ms in the SE:
• L&Ms in the SE placed less emphasis on collaboration than their for-profit counterparts;
• Duplication was seen to be widespread across the sector;
• There was no identifiable common issue that could unify the sector;
• Fewer SE organisations would increase the possibility of collaboration.

g) Competition was expressed in a number of forms two of which were:
• The role of proprietary knowledge within the sector;
• Competition as the driver of efficiencies and innovation.
The issue as to when and on what basis competition was legitimate within the sector was discussed.

h) One consequence of competition was observable unequal power relationships in the sector and lack of transparency. Views associated with these two issue areas were:
• Larger corporate ‘charities’ were viewed as the major power brokers (especially with governments and funders);
• Smaller (SME and microenterprises) were seen as the least powerful;
• The unevenness of power relations was most explicit in funding processes;
• Mistakes in the sector were rarely known or shared for fear of repercussions for funding and increased accountability demands.
• Knowledge tended not to be shared within the sector particularly where there was potential for adverse criticism.