Whatever happened to our values, ethics and integrity?

In recent weeks a whirlwind of accusations has struck fundraisers. Combine this with criticism of charity chief executive salaries, and you can perhaps begin to understand the perception of charities as ruthless and money-grabbing. While many of the media comments are ill-informed and taken out of context, they do point to a growing cynicism about charities. Trust is the lifeblood of voluntary organisations, so if we ignore this trend, we risk endangering the health of the sector.

In reality, most members of the public – beneficiaries or donors – have no real evidence of how charity money is being used; they simply rely on trust. If, as a beneficiary, you are going to open up your life to a charity worker when you are feeling particularly vulnerable, you really need to believe they have your best interests at heart. Similarly, donors need to be convinced that charity staff are both professional and truly working for the cause. So if integrity is being questioned, it strikes at the heart of what charities do,  and we must listen to those alarm bells and act quickly and decisively. This, of course, requires charities to rebuff accusations promptly and robustly. However, we also need to reflect on how this situation has come about and consider whether charity culture is fuelling these misperceptions.

Charities have changed massively over the past 20 years and the move to be more business-like has, in many situations, had an unfortunate side effect of over-simplifying approaches to measuring success.  I have heard many senior charity staff talk about their success in terms of an increase in numbers of staff, the opening of new offices and an increase in donations. While they are important, these indicators are meaningless if they do not result in a greater benefit to the cause. They are a means to an end, not an end in themselves. We all know cash-strapped charities that have no offices and are run by volunteers who are doing brilliant work, and many that are financially successful where the work is not so brilliant.

In our conversations, charities do not talk enough about values and the beneficial impact we’re having on the world. I have yet to hear a charity chief executive gloat about the fact they have successfully completed what they set out to do and are closing down. While measures of impact might be in the annual report and monitoring returns, every day discussions and celebrations are still grounded on the assumption that bigger is better when it comes to measuring charity success. But is a charity that has been in existence for 70 years, doubled its income in 12 months and trebled the size of its London offices really a success? And if we are talking about these as measures of success, is it any wonder then that people question our integrity?

The benefit to our cause is the only real measure of a charity’s success. As soon as success measures move away from this, so staff efforts and energies become distorted and this will inevitably lead to unsavoury practices. Fundraising teams will feel pressured to get the money in at any cost without considering the wider ethical implications. It is always true that what gets measured gets done. If people get recognition for hitting financial goals but not for behaving ethically, then they are not going to worry too much about being nice to vulnerable donors.

Charities need to to treat this latest controversy as the impetus to review priorities and refocus the conversation. Where are the stories about the changes to people’s lives? Where are the examples of communities that are now self-reliant because of charity work? Where are the successful exit strategies?  Charities need to bring values, integrity and ethics back to centre stage, because if we just focus on our money and size we will become indistinguishable from commercial organisations. And if that happens, then why would anybody need a charity sector?

Stella Smith is a strategy and governance consultant

  • Pamela Ball

    Well said Stella Smith ! You echo so many of the key messages that we are trying to share in a new prototyping model of sector infrastructure . Bigger is not necessarily better and never should be an aim in and of iteself, the wrong money for the wrong reasons Won’t create a good outcome for your beneficiaries etc. Clear purpose and values against which all charitable activity are measured is the most sustainable model and more importantly keeps the work focused on the charitable aims. It IS the ideal that we should all reach a place where we should shut down due to needs being met.

  • dieseltaylor

    I applaud the sentiments expressed. Without ethics a charity becomes a business and as we all know for many businesses the ends justify the means.

    For a business this often means bigger pay for the executive team and a dividend for shareholder – but this of course is done over very short time scales compared to the life and reputation of a charity.

    I do not work for a charity. I have a daughter who does. I have contributed to one charity for over 40 years and several for decades. So I am a donor. I am also an analyst of how businesses perform and now I look at charities.

    I am not happy as I am a purist in my expectations of how charities should operate and it is disturbing to see what a lax hand the Charity Commission operates with. I made a complaint about a well-known charity setting up a scheme where four executives of its operating company were the beneficiaries of a £2.5m bonus plan. They are not interested.

    So between a supine Charity Commission and Trustees who have a vision of charity different from most people there now exists a chasm. Charities exist because of people willing to contribute or volunteer and the more they distance themselves from the publics expectations the harder the fall.

    • Jude Habib

      Stella – a great article and spot on insights.

      Diesel – is there anyway you can let Third Sector know about your findings above with regard to the bonus plan. This is really disturbing.

      • Andrew Hillier

        Hi Jude, I think Diesel is referring to the Consumers’ Association/Which? bonus plan, which we reported about in April.

        • dieseltaylor

          Yes Andrew is correct. As part of its defence of the bonus plan Which? said in the article “As an independent social enterprise, we do not accept any donations or government funding, so we can only continue our charitable work for all consumers if we sustain our commercial success.”

          This rather obscures the fact that the organisation has been funded by subscriptions to the magazine since its inception in 1957. It is expensive compared to other consumer magazines in the world and this bonus from high magazine subscriptions is funding a commercial expansion as reported in interviews in the Independent twice in the last year.

          It fails to mention is that the four year venture into publishing in India has resulted in an acknowledged loss of £10.5m mentioned at the 2014 AGM..

  • Bahja

    Well perhaps it’s time to stop calling those shifting organisations “charities”. How about simply aid service providers – but definitely not charities?

    • Stella Smith

      Bahja, like the idea! Maybe it is time we redefined what a charity actually is…interesting thought!

  • Christopher Hearn

    Stella, your 5th paragraph says it all as far as http://www.yessociety.org.uk are involved/concerned. We are a brand new small-scale non-profit organisation offering charities additional funding via our online charity raffle with operating costs capped at 5% max and yet our offer, without consultation or presentation opportunities, is being repeatedly rejected by committee’s of long-established charities in preference for promoters who offer charities very slightly more than us but what is significant is the fact that the promoters are pocketing over 25% of the public’s money under the suggested guise of admin? Now that we consider to be both morally & ethically wrong. This is 2015 and software technology permits online fundraising lotteries & raffles to be administered for a lot less than 25%. We say “Don’t take the people who support you for granted” and we are referring to the generosity of the public. Also if you operate a scheme offering a potential reward then make sure the prizes on offer are genuinely within the public’s grasp and not just unethical tactics simply resulting in operators topping up their 25% even more!