Transforming the way society thinks about not-for-profits


By Chris Gandy

If you get a few spare minutes try to catch Dan Pallotta’s TED talk “The way we think about charity is dead wrong”.

Dan really knows the sector having created the multi-day charitable event industry with the AIDS Rides and Breast Cancer 3-Day events, which raised $582 million in nine years. But he also believes the sector is struggling big time to make progress against an ever-increasing demand.

If we look at the big social problems, the needles aren’t moving very much–not at nearly the pace we had hoped. In the U.S., for the past forty years poverty has remained constant at twelve percent of the population. AIDS deaths have increased from 1.1 million a year twenty years ago to 1.8 million today. Breast cancer deaths in the U.S. have only gone down by about eight percent in twenty years.”

He puts this lack of progress down to the way the general public and Governments perceive the sector.

The public wants charities to spend as little as possible on overhead. The public doesn’t like to see charities paying high executive salaries. The public wants every gala dinner and walk-a-thon to send one hundred percent of the money donated back to the cause. What the public doesn’t realize is that low overhead is not a path to the end of world hunger or a cure for cancer. It’s the opposite. Only allowing charities access to the lowest-cost talent is not a strategic plan for alleviating human suffering. Demanding home runs on every charitable fundraising endeavour discourages innovation and keeps charities small and in fear. The very things the public has been taught are good and ethical–low overhead, low executive pay, funneling all donations to the cause–are practices that are killing us.

The public doesn’t know this is wrong because the non-profit sector, government regulators, and the media keep telling them that these are the things that matter. Thus we are trapped in a vicious cycle with the public: we keep telling people what they want to hear about how their charitable donations should be used, and they keep parroting back to us.”

Rather than simply moan about the problem, Dan is trying to do something about it and his strategies are outlined in his latest book “Charity Case: How the nonprofit community can stand up for itself and really change the world”.

His plans are out there but hats off to him for taking up the challenge.

Fundamentally he believes the sector lacks leadership so he and some colleagues have established the Charity Defence Council which will focus on five strategies to profoundly change the way the public thinks about charity

1. Establish an anti-defamation league: To correct inaccurate and sensational stories in the media that continue to contaminate public thinking with the wrong ideas about the non-profit sector.

2. Conduct major advertising campaigns: To begin a conversation with the general community about the work it does and how it needs to do it to be effective.

3. Set-up a legal defense fund: To allow not-for-profits to fearlessly speak-up when unintended consequences threaten the sector; they must have a central, knowledgeable, articulate agency from which to enlist help; the agency must be proactive and create long term solutions and an effective regulatory environment; and it must work to change the public’s understanding of fraudulent activities in the sector.

4. Help enact a National Civil Rights Act for Charities and Social Enterprises: To dramatically improve the sector’s standing through changes to public policy.

5. Organize the sector and those who lead, work, and volunteer in it to act and speak on their own behalf: To bring the sector together, stand up and “come out and tell people that “I kept the overhead low” is not what they want engraved on their tombstones”.

Dan has given himself 10 years to transform the way the public thinks about charity. And how will he know he has achieved this?

A study from NYU revealed that in 2008 seventy percent of the general public believed that charities waste either “a great deal” or “a fair amount of money.” We will know we have succeeded when seventy percent of the public believes the opposite”.

All power to him.

About the author: Chris Gandy is a Director of Cause and Effective ( a company dedicated to assisting cause-based organisations make greater social impact. For more information check out “What We Do” and “How We Do It”.

About B-Cause

B-Cause is published by Cause and Effective. We help good causes find and attract effective leaders.

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