A critique of current charitable approaches by a foundation leader. Problems with current approaches include:

  • One-off gifts make it difficult for charities to plan
  • Restricted gifts contort management decisions and force decisions that are not consistent with long term strategy
  • Funding approaches ‘feed the myth that money spent on administration is wasteful’

Wider consequences include:

  • Charity leaders with dual roles unable focus on fundraising or leadership
  • Level playing fielding for charities regardless of effectiveness
  • Accountability vacuum for leaders caused by the ‘gift’ culture of donors

The way forward is:

  • Leverage business knowledge for the benefit of charities – but in a way that acknowledges the different history and objectives of the charitable sector
  • Donor should adopt an investment mindset, encouraging charities to focus on: strategy, management, governance, success criteria
  • Acknowledgement that in business competition drives progress while in charity co-operation drives progress

Source: Panahpur