‘True and Fair’ Foundation report is neither true nor fair

Today’s Daily Telegraph features a story on a ‘report’ from an outfit called the True and Fair Foundation, which is run by someone called Gina Miller, who describes herself as a philanthropist and transparency campaigner. The report is described by the Charity Commission as ‘flawed’, by Sue Ryder as ‘misleading’, and by Which? as ‘very misleading’.

The headline is ‘1,000 charities ‘spent less than half’ of funds on good works’.

Ms Miller says she thinks this is ‘an utter disgrace’ and ‘it is time a light was shone on the sector so people can see just how their hard-earned money is really being spent by charities’. She says charities should be required to spend at least 65% of their income on charitable expenditure.

Deliberately misleading

The idea is to make you believe that when you give £10 to charity, only £4, or whatever, goes to the charity’s ends. The other £6 goes on jacuzzis, caviar, that sort of thing.

Of course, this isn’t what’s actually going on.

Where your money really goes

The reality is that the £10 you donate is part of a total £20 the charity has at its disposal to spend. There’s your £10, and there’s also the £10 margin that it made on trading. In order to get this other tenner from trading, it had to spend £30. It got back £40, £30 of which covered its outlay on the trading, and £10 of which was the profit that went to the end cause, along with your £10. In doing all this, its total income was £50 – your £10, plus the £40 from trading. The £20 it has to spend on its cause is 40% of this £50.

Do you think only 40% of your donation has gone to the cause? In fact, the charity has added to your donation with its trading.

The charity could perhaps stop generating income like this, and rely solely on your £10. But then it would have less money to spend on its cause. Most large charities have a mix of different income sources like this. It’s part of what makes them sustainable and able to do so much.

You can see explanations from Sue RyderBritish Heart Foundation, Cancer Research UK and Guide Dogs rebutting this report and setting out their spending in detail.

A bad idea

So, to meet Ms Miller’s arbitrary ‘65%’ demands, Sue Ryder could shut down its charity shops. It would be spending less on trading, so its ratio would look ‘better’ in her eyes. But it would have millions of pounds less to spend on the people it helps.

It’s complicated, but not that complicated

There are some charities cited in the report that don’t neatly fit this explanation, but this is at the essence of what is going on in most cases. In some cases, the charity’s entire income comes from trading, like Which? or the Lloyd’s Register Foundation. Others have slightly different explanations. The Racing Foundation, which Ms Miller bemoans for its 8% ratio of charitable expenditure to income, received a one-off £50m endowment in that year which understandably dwarfed its normal outgoings. It’s a perfectly reasonable explanation for the ratio being what it is.

It also highlights that charity accounts (which record total incoming resources, such as grants to spent over numerous years) are not the same as company accounts. We explained this in detail to Ms Miller when we saw her report before it was published, and signposted independent academic charity accounting specialists she can refer to, but it appears our advice has been ignored.

(The True and Fair Foundation don’t mention in their report that their own 2013 ratio of charitable expenditure to total income was 47%. Though at least they managed to submit their accounts on time that year, unlike previously.)

We tried to explain it to the True and Fair Foundation

We spent a long time, as did several of the charities mentioned in the report, and other experts, trying to explain all this to Ms Miller and to the Telegraph. I’ve offered to meet and help Ms Miller if they do in fact wish to develop an analytical framework. They didn’t want to listen. Ms Miller, who runs a network of investment websites, seems to have been more interested in self-publicity than in accurate or constructive research.

(This is all, for reference, nothing to do with campaigning or with staff costs – those issues are a red herring here.)

We’re all for transparency at NCVO. We do a lot to make charity finances accessible, through our UK Civil Society Almanac programme, for example, and have consistently campaigned for greater transparency in various areas. But this ‘report’ is a prime example of an adage I have long held dear: just because you have put your ramblings in PDF format, it doesn’t make them more valid. There are interesting debates to be had about the detail of charity reporting requirements and how they can help readers to understand how charities work.

This ‘report’ contributes nothing to those debates.

In fact, it is so misleading in its analysis – and I can only conclude deliberately so – that the only reasons I can think of for publication are ones of self-interest, self promotion or outright ideological attack on charities. I suspect the analysis is so bad however that the only body whose reputation will suffer is the True and Fair Foundation and all those associated with it, including Ms Miller.

UPDATE, February 2016

Following a complaint to The Telegraph by NCVO, and mediation by IPSO, The Telegraph has made substantial amendments to its online article, and published a correction in print. We are grateful for their constructive engagement in this process.

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25 Responses to ‘True and Fair’ Foundation report is neither true nor fair

  1. Gina Miller says:

    Thank you for your blog. In terms of true and fair, we ensured our research was both true and fair by:
    – using precisely the same data and definitions/calculations used on the Charity Commission websites
    – comparing this data with the charities’ own report and accounts
    – averaging the data from the last three Report and Accounts.

    Here is one example of a named charity from the Charity Commission – you’ll see the figure that they emphasize is actually 44% – here is a link: http://beta.charitycommission.gov.uk/charity-details/?regid=1052076&subid=0

    If the charities disagree with their accounts, why did they sign them off and submit them to Company’s House if they really are misleading?

    If you are correct and our analysis is flawed, misleading and incorrect, then so too must be all the data on the Charity Commission websites. Will you be campaigning for them to remove all their data which has been accessed 6 million times?

    The simple fact is that it is almost impossible for donors to understand how much is spent on the end charitable causes.

    • Karl Wilding Karl Wilding says:

      Dear Ms Miller,
      Your response rather avoids the problem under discussion – the fatally flawed analysis you have undertaken and published.

      I suggest we put aside the ‘beta’ website (the clue is in the name) and instead focus on the accounts audited by statutory auditors. You’ve linked to Sue Ryder Care, which fundraises using charity shops: I’ve already written to you about them, but Sue Ryder’s explanation, based on their accounts, is very different to yours. Readers can make their own mind up: http://www.sueryder.org/media-centre/blog/2015/december/our%20fundraising

      It’s fundamentally flawed to think that charities can’t trade to generate funds – and similarly flawed to assume that the cost of goods and services shouldn’t be an expense.

      It’s equally flawed to assume that charity accounts are the same as company accounts: they don’t report ‘current income’, they report any income they receive (or in the case of legacies, even income that they have not yet banked). In some cases, they might be given this on the basis that they don’t spend it now, but that they hold it forever more! Look at our great endowed hospitals, such as Barts or St Thomases – tell all their users that under your rules, no charity can build an endowment to last it a lifetime.

      This report is so wrong it is incredible.

      • Pete Ridley says:

        Hi Karl,

        Gina’s “True and Fair” campaign calls for more transparency (http://www.trueandfaircampaign.com/). As a past donor to several UK charities, recent investigations into the “vacant commercial and industrial property” and “plastic begging bags” sectors of the charity industry, I have come to the conclusion that transparency is anathema to operators in the industry.

        As someone whose entire career of 20+ years has been in the charity industry (http://the-sra.org.uk/my-career-karl-wilding/), a sceptic like me would argue that you have a vested interest in defending it, no matter what.

        The NCVO says you have ” .. lead responsibility for .. championing the voluntary sector .. a non-executive director of Charity Bank, a trustee of US voluntary organisation Creating the Future, a trustee of St Albans Centre for Voluntary Service, and an Honorary Visiting Fellow at Cass Business School’s Centre for Charity Effectiveness .. ” (https://www.ncvo.org.uk/about-us/whos-who/ncvo-directors).

        You claim to be ” .. pushing for greater transparency on charity senior executive pay .. ” (http://www.civilsociety.co.uk/finance/indepth/analysis/user/Karl-Wilding/content/18935/ncvo_leading_from_the_front_on_executive_pay) so how about setting an example by stating openly and honestly on this blog of yours just how much money you earned from your efforts. Lets hear for starters what the figure was for 2014-15, then perhaps let’s see a graph of how it has progressed during the past decade.

        Best regards, Pete Ridley

        • Karl Wilding Karl Wilding says:

          If you search ‘ncvo pay’ you’ll see that my pay is on the website here, two clicks from the home page: https://www.ncvo.org.uk/about-us/finances-pay

          To save you looking, I’m currently paid £84,695 for my NCVO role. My roles at Charity Bank, St Albans CVS and Creating the Future are all unpaid.

          As regards a graph of my pay over time: well, I’ve been a director for about two and a half years, during which I’ve received annual increases of 2%.

          You posted the question at 7pm on a Sunday night, and subsequently posted at 11pm, asking if your question was too close for comfort as you hadn’t received a response. In answer, no, the information you wanted was all publicly available on the website.

    • Nick Temple says:

      Gina – good on you for responding here, but I don’t think you address some key points.

      Firstly, the Charity Commission have themselves called your analysis flawed. The issue is not with the data, but with the analysis.

      Secondly, although you have clearly supported several local charities (undoubtedly a good thing) your understanding of the breadth of the charity world seems lacking. Comparing such different organisations as Which & Guide Dogs for the Blind, who earn/raise money and pursue their missions in such different ways, and comparing them solely by financial accounts, is always bound to be reductive and problematic.

      Thirdly, your own website encourages a focus on the impact that charities have, but your report does the opposite: in that it only focuses on the finances, administrative costs and so on, not on the work or scale of the impact the charities are having. This would be the case, even without the flawed analysis of the finances.

      Finally, you state that it is difficult for people to understand charity accounts, and that they are complex. There are many that would support that view, and recommend changes. Unfortunately, your report does not say ‘these are difficult to read and should be clearer’ (at least as its headline), it says ‘these charities aren’t putting enough money towards their social purpose’; in my view, erroneously and in a way that misleads.

      I hope you will choose to work with people in the sector in future to achieve what may be shared goals, rather than use the media as the first port of call. As with the ‘careerists’ piece 18 months ago or so (also in the Telegraph, also not picked up anywhere else), it tends to smack of self-promotion rather than a commitment to the best for charities and those they work with.

    • Tania says:

      Dear Ms Miller

      You say “If the charities disagree with their accounts, why did they sign them off and submit them to Company’s House if they really are misleading?”

      Perhaps you should look at your own organisation’s accounts. In 2013, using the same flawed methodology, The True and Fair Foundation only spent 48% of your income on charitable activities – but you submitted your accounts – and in fact signed them yourself.

      Based on your recommendations, should your charitable status be reviewed?

    • Teresa Forgione says:

      Dear Mrs Miller

      You make a clear point, “The simple fact is that it is almost impossible for donors to understand how much is spent on the end charitable causes.” However your report does not address that question. Conflating trading and donations is simplistic methodology, and yes, of course your maths stacks up. However the messages you infer are far from being useful in directing people to understand better where their donations actually go.

      I’m sure you’re dismayed by the response you’ve had this weekend, from charities, donors, charity workers and the Charity Commission. The whole gamut really. Transparency is in everyone’s interests – including yours, so if you have questions you really are troubled by and want to find an answer to, why not sit down with some of the charities you are most concerned by. My only request is that once you’ve had that discussion and understand the wider context of the snippet of info you used to produce your report, you publish again, and make constructive, collegiate suggestions for improvement. After all, we’re all in this to eradicate the issues that blight humanity and I for one would love to be out of a job, if it meant that we’d found a cure for the major social and medical ills that face us all. I’d skip down to McDonalds and serve happy meals for the rest of my days, knowing that I’d played a tiny part in leaving a lasting legacy for mankind.

  2. Lisa Clavering says:

    I don’t think the dispute is in the data, Gina – it’s in the message you are putting out in terms of how you’re reading it. No-one is disputing the figures that have been published. If the issue is one of transparency and understanding what the figures represent then why not put your energy into campaigning for a different format of reporting, rather then your ‘name and shame’ approach?

    As an aside, many would also find flaw in the ‘how much you spend on charitable work’ measure being a key indicator for ‘good’ vs ‘bad’ charities – I’d refer you to Dan Pallotta’s TED talk but here’s a key snippet that demonstrates the gist:

    “This is what happens when we confuse morality with frugality. We’ve all been taught that the bake sale with five percent overhead is morally superior to the professional fundraising enterprise with 40 percent overhead, but we’re missing the most important piece of information, which is: What is the actual size of these pies? Who cares if the bake sale only has five percent overhead if it’s tiny? What if the bake sale only netted 71 dollars for charity because it made no investment in its scale and the professional fundraising enterprise netted 71 million dollars because it did? Now which pie would we prefer, and which pie do we think people who are hungry would prefer?”

  3. Tom Levitt says:

    This appears to be a classic case of: decide what you want to ‘prove’ then choose those figures which appear to support your view and ignore the rest. It is neither research nor journalism, it is fantasy. The so-called ‘findings’ have been disowned by the Charity Commission on Twitter (even before the author prayed them in aid in her response to Karl) and Lisa’s quote from Dan Palotta’s wonderful TED talk – from about 3 years ago – is spot on!

  4. Clive says:

    I’d say the article is pretty damn true. The only problem with it is that Carers UK aren’t on the list.

    A national charity for carers who try to silence those that disagree with their stranglehold on speaking for carers to such an extent that they make false reports to the police and social services to shut people up via intimidation.

    A CEO who receives over £80k a year plus expenses speaking for carers who get a little over £2k a year and thinks she knows what our lives are like.

    I’d never give to a charity after seeing how morally and ethically corrupt the national charities are

  5. Richard Sved says:

    I believe this report to be flawed, misleading, and potentially damaging to charities, all based on a single premise looking at percentages rather than total income and expenditure, which I feel to be both reductive and bogus.

    Charities that invest their income in trading, charity shops or other ventures will clearly have increased turnover, and a lower *percentage* of that turnover will be expenditure for ‘good causes’.

    But if that trading turns a surplus, and most of them do (or charities wouldn’t be doing them), then the *total income* raised for good causes is increased.

    It’s breathtakingly simple.

  6. Matt Collins says:

    I’d echo all the other comments here on the incredibly simplistic and misleading analysis. If you don’t really know how to interpret financial information, and ignore the professional advice of those who do, then just don’t do it.

    This is just the latest in a long campaign against charities. I don’t know what it’s motivated by, but it will not succeed in stopping the life-changing, life-saving work that they enable day in, day out.

    And given that you can’t beat ’em Gina, maybe you should join ’em – this might be a good place to start:


  7. Robin Stafford says:

    I’m afraid Ms Miller has form in this area though it is unclear to me why she should have an agenda of undermining charities.
    The most glaring evidence of the incompetence behind this analysis is where they claim Lloyds Register only spend 1% of their £1bn turnover on on charitable activities. They fail to note that Lloyds register is a business not a charity and that the £1bn is their turnover.
    As people who work in the City (that well known bastion of integrity and honesty), you’d would expect them to know who Lloyds are. That they attack charity CEOs for being overpaid when they themselves represent the most bloatedly over paid sector in the UK is particularly hypocritical and unpleasant
    The question is why this person appears to have a deliberate agenda of undermining the sector. Personal? Political?

  8. Patrick Taylor says:

    I too wondered at the inclusion of such a disparate group but then realised Hornets Nets actually was true to its title.

    I have looked at the top four in the list as they included two outstandingly odd “charities”. I am referring to the Lloyds Foundation, and the Motability 10 year Anniversary Trust which both have some interesting characteristics. A quick read makes me concerned that some financial legerdemain is/has occurred.

    I am entirely happy with the Horse Racing.

    Whether by accident or design the entire sector and the newspapers have this on their plate. Highly contentious but I do wonder how much attention it would have received if just those two charities had been brought forward.

    SO who speaking for the charity sector would like to defend Lloyds and the Motability 10 Trust [?] as being “proper” charities?

    Which? of course I am critical of for its Governance and executive pay and some in the charity sector do wince at what has been going on their.

  9. Iain says:

    I wonder if someone should file a formal complaint with the Charity Commission? The True and Fair Foundation seems to have published a report that seems expressly designed to call into question public trust and confidence in charities, despite prior advice from the Charity Commission that they felt the Foundation’s approach was flawed and misleading and would be damaging to public trust and confidence in charities. Protecting trust and confidence in charities by sanctioning charities whose behaviour jeopardises this is, I think, a core remit of the Commission.

    • Barney Mynott, NAVCA says:

      This is an interesting issue. Who is Gina Miller accountable to? Her charity has put out some very questionable research despite being advised that the research conclusions were wrong. This has caused damage and it would be hard to argue that the public interest has been served. Has personal gain been put over the wider public interest and possibly even the Foundations?

      PS excellent work by Karl and his NCVO team – thank you.

  10. Pete Ridley says:

    Hi Karl,

    Gina’s “True and Fair” campaign calls for more transparency
    (http://www.trueandfaircampaign.com/). As a past volunteer for and donor to several UK charities, recent investigations into the “vacant commercial and industrial property” and “plastic begging bags” sectors of the charity industry, I have come to the conclusion that transparency is anathema to operators in the industry.

    As someone whose entire career of 20+ years has been in the charity industry (http://the-sra.org.uk/my-career-karl-wilding/), a sceptic like me would argue that you have a vested interest in defending it, no matter what.

    The NCVO says you have ” .. lead responsibility for .. championing the voluntary sector .. a non-executive director of Charity Bank, a trustee of US voluntary organisation Creating the Future, a trustee of St Albans Centre for Voluntary Service, and an Honorary Visiting Fellow at Cass Business School’s Centre for Charity Effectiveness .. ”

    You claim to be ” .. pushing for greater transparency on charity senior executive pay .. ”
    /content/18935/ncvo_leading_from_the_front_on_executive_pay) so how about setting an example by stating openly and honestly on this blog of yours just how much money you earned from your efforts. Lets hear for starters what the figure was for 2014-15, then perhaps let’s see a graph of how it has progressed during the past decade.

    Best regards, Pete Ridley

  11. Pete Ridley says:

    Hi Karl,

    Was my comment too close for comfort?

  12. Pete Ridley says:

    Hi Karl,

    Please forgive my impatience over the time that my comment was held in moderation. A watched pot never boils.

    Thanks very much for demonstrating the sort of transparency that those of us who are wary of the activities of those earning a living within the charity industry would like to see much more of. Does your salary of almost £85,000 include other perks or do you get extras, such as productivity bonuses, a car, etc.

    It’s a shame that others in the charity industry are not so keen to disclose the benefits they derive from the generous donations of the UK public. Earlier this year I undertook research into the motives of the business organisations involved in posting and collecting the plastic begging bags that keep coming through my letter box. In the process I perceived a strong aversion to transparency about how the proceeds of the appeals under the brands of various charities were distributed.

    One of those organisations that I followed up on is the £8M+ per year Starlight Children’s Foundation”. The registered office of both the charity and the associated private company – #02038895 – is the ” .. high quality serviced office accommodation .. ” at Macmillan House, Paddington (http://www.bprarchitects.com/portfolio/50/macmillan-house). CEO Neil Swann was appointed Secretary of the company in September 2011, although he says that it has been dormant since 2005.

    As part of my research I enquired about the charity’s executive structure and salaries in early October 2015. It took CEO Neil Swann until 25th November to respond and he simply pointed me in the direction of the returns held by the Charity Commission. He did conclude with ” .. If there is any further information you require, please do not hesitate to email me back .. “.

    The notes to the audited accounts showed that the number of employee whose emoluments fell within the following bands was:
    – £90,000 TO £99,999 – ONE
    – £110,000 to £119,999 – ONE

    My follow-up question on the same day was ” .. Am I correct in assuming that you, as CEO, are the employee who enjoys that nice 6-figure salary?  BTW, who is it who gets that slightly lower salary? Is that the Director responsible for fund raising? .. “.

    One month later and I’m still awaiting transparency on that, but I’m not anticipating any further response!

    As I said in my 10th July E-mail on the subject of “The UK’s 3rd Sector: UK Charities and their Relationships With UK Private Companies” sent to Rob Wilson, Minister for Civil Society, the British Heart Foundation, WorldHeart Uk and the Charity Commission concerning the BHF’s sponsorship of the proposed new charity WorldHeartUK, QUOTE ..

    the UK now has at least FIVE other charitable organisations involved in the same activities as the BHF charity. Presumably all of these UK charities are begging for donations from UK residents and all have their own costly individual organisational structures. Why are so many needed? How much more begging in the name of good causes are we in the UK prepared to tolerate? Does the UK’s new charity add anything of benefit to UK residents .. I can see no justification whatsoever for the establishment of a fund-raising UK charity functioning as a global umbrella organisation when there already exists an European umbrella organisation having similar mission .. Since becoming involved in investigating the relationship between UK charities and UK private commercial companies vis-a-vis those plastic begging bags that keep coming through my letter box, my requests to various charities and private companies involved for more information about their relationship have repeatedly been met with evasive responses. For both the charities and the private commercial companies, transparency appears to be an anathema. Starting at the end of May with an expectation (or was it just hope?) of transparency, at least from the UK charities, I’ve arrived at the opinion that that the term “Smoke and Mirrors” is very relevant as far as the upper echelons of the UK’s “Third Sector” is concerned .. I would love to hear comments from the UK’s “Third Sector” Minister, Bob Wilson, from the Charity Commission’s CEO Paula Sussex and from the UK’s Trading Standards Scam Team project manager Louise Baxter on these vexed issues (plastic begging bags, proliferation of “same cause” charities, lack of transparency in the third sector) ..

    .. UNQUOTE.

    Of course, I’m still awaiting a response from the main recipients of that E-mail, although the National Trading Standards Scams Team did respond that it ” .. is currently focusing on mass marketing fraud and mail scams .. “.

    Best regards, Pete Ridley

    • Karl Wilding Karl Wilding says:

      Pete, on my salary, the £85,000 figure is it. I don’t receive any sort of performance related bonus, car, etc.

      On the charity you are interested in, I would hope that all charities respond to reasonable requests for information about how they operate; ultimately, in a society where people are free to give their time and money to a wide range of charities, they will decide who to give to on the basis of factors including openness and transparency.

      If true, that links to your final point about the number of charities doing similar things. If this was the private sector we would argue that competition between different companies operating in the same market was good and that market forces were an excellent discipline. While the charity sector isn’t a market, the discipline of competing can be good; and more to the point, whatever hat they wear, people want choice, and charities doing different activities in the same area provides that choice. I’m not suggesting we should have an infinite number in any one area – there are clearly diminishing returns to the idea of choice – but equally, the idea of one heart charity or one cancer charity isn’t necessarily in the public interest either.

      Your final point on transparency being anathema – some charities clearly have some way to go on transparency. But others are doing well: I can’t help but think that we might encourage more charities to open up if we highlight the ones that we think are doing well and demonstrate why being more transparent makes a difference.

  13. Pete Ridley says:

    i Neil,

    In my previous comment concerning transparency within the charity industry I used as an example the “Starlight Children’s Foundation” organisation (http://www.starlight.org.uk). I understand this to be a subsidiary of (or at least closely associated with) the global operation based in Los Angeles (http://www.starlight.org/about provides a direct link to the UK under “Starlight Near You”).

    Neil Swan, Company Secretary/CEO within the associated UK group of companies/charity claimed that the private company within the UK group has been dormant for the past 10+ years yet the Companies House records appear to tell a different story. According to Datalog, updated on the 22nd October 2015 using data from Companies House, the company is QUOTE: ..

    ACTIVE ..
    – Annual turnover is £6.5 million or more
    – The balance sheet total is £ 3.26 million or more
    – Employs 50 or more employees ..
    Current Directors
    … COOK .. 2004-02-11 … FORBES .. 2005-07-27 …. PATON .. 2001-10-31 … HANBURY .. 2001-10-31 … LUCAS .. 2005-07-27 … MUSTOE .. 2002-04-29 … TASKER .l 1994-09-13 … WAY .. 1995-08-10
    NEIL SWAN Company Secretary 2011-09-30 ..

    .. UNQUOTE

    That a large executive for a dormant company to have, which suggests to me that, contrary to what Neil Swan claimed, the Starlight Children’s Foundation company is anything but dormant. Of course it’s possible that I am simply misunderstanding/misrepresenting the available data, as you claim that Gina Miller’s “True and Fair Foundation” report does.

    Maybe Neil Swan was talking about another company to which he was apparently appointed Company Secretary in 2012. ” .. Name & Registered Office:
    W2 1HD
    Company No. 02670200 .. “.
    That company too is shown as being an “ACTIVE” but also “DORMANT COMPANY”.

    As I don’t expect that Neil Swan will be interested in clarifying this for me, perhaps you, in your roll of ” .. championing the voluntary sector .. ” would like to have a go.

    As a retired Chartered Engineer I have only served as a trustee and volunteer with small local charities. None had any need to set up complex business structures of private companies in support of their genuine charitable objectives. One of these managed perfectly well with only a couple of part-time employees, an administrator and a cook, both on salaries only a fraction of what you and Neil Swan enjoy. All of the other tasks were undertaken through volunteers generously donating their time and skills free of charge for the benefit of the community – what I regard as REAL charities. I trust that with your 20+ year career in the charity industry you will fully understand why I should be very puzzled about why larger organisations in the charity industry cannot perform effectively on a similar basis.

    This comment, from an ex-employee of the global Starlight Children’s Foundation in Los Angeles, aligns with my own opinion about the UK’s charity industry ” .. Executive level management and CEO appear to be more interested in furthering their own professional agendas .. ” (https://www.glassdoor.co.uk/Reviews/Starlight-Children-s-Foundation-Reviews-E426737.htm).

    Best regards, Pete Ridley

    • Karl Wilding Karl Wilding says:

      I can’t say I know the Starlight Foundation, they aren’t an NCVO member. You’ve suggested above that it is a dormant with 50+ employees and a large number of directors (8; the company secretary/CEO is not a director) for the size of organisation.

      I’ve just looked at their latest audited annual report on the Charity Commission website, which has been filed on time: http://apps.charitycommission.gov.uk/Accounts/Ends58/0000296058_AC_20150331_E_C.pdf

      The charity isn’t dormant and seems to be operating normally. The company directors, as per normal in most charities, are in fact the unpaid trustees of the organisation. The charity employs 21 staff. The charity does indeed have £3m on its balance sheet, which is in line with its stated reserves policy. As an aside, this is held as investments assets, and generates about £44k income a year, which is spent on its charitable purpose.

      It does indeed appear to have a trading subsidiary which is dormant, but this is also normal – this is a wrapper for commercial activities that generate a surplus which can then be applied to the charitable cause, but the charity appears not to be undertaking such activities at the moment.

      I’m afraid I’ll have to disagree with you on your definition of a ‘real charity’. There are many different operating models, including charities that employ paid staff. The trustees have clearly decided that the charity can achieve a bigger impact by employing talented, professional staff to run the organisation and they have agreed the level of remuneration required to recruit someone to deliver that role. If the foundation were to follow NCVO guidelines they would provide more detail about the remuneration of the directors.