Day 58: Rethinking non-profits

Do you make a lot of money helping others? If so, I am sorry to have to break this to you, but society sees you as a parasite. That’s the general message coming though Ted speaker’s Dan Pollatta’s pressentation “The way we think about charity is dead wrong

If you are in the field of helping others, you are expected to be selfless. This means that you can’t live in an expensive home, or be on a good salary as that wouldn’t look right? Well actually Dan Pallotta thinks that this type of thinking can ultimately do more harm than good.

Dan uses the example of business MBA graduates who would be taking a pay cut by taking their talent to charities. He  says that graduates who are the “brightest minds” might not be wiling to take a pay cut.

“Now, there’s no way you’re going to get a lot of people with $400,000 talent to make a $316,000 sacrifice every year to become the CEO of a hunger charity.”

When I first heard that I was really taken aback. I don’t want to see someone running a non-profit racking in hundreds of thousands per year in personal wealth . I want to see someone running a non-profit who doesn’t care about money, someone who puts every spare cent right back into their non-profit. Ideally they would be reimbursed in praise, warm fuzzies and appreciation and not financial compensation. In lieu of payment they would be free to wear a glowing halo letting everyone know how awesome they are making financial sacrifices.

The second issue Dan raised was the stigma attached to  charities spending money on advertising. People who donate to charities don’t want to think that their money is going to marketing. If you donate to a charity you’d typically like to think that every dollar is going directly to help those in needs. However, what if your donation that was put towards marketing actually ended up bringing in more money for the need via advertising.

This talk made me uncomfortable. I want to be okay with CEO’s of non-profits accumulating personal wealth but it doesnt feel right. I know the logic that Dan presents makes sense. Financial incentives are great leverages for attracting the highest skilled people to run our non-profits and this could result in the non-profit generating more revenue anyway. Despite knowing this I still think that this doenst look good. It doesn’t look good if  the CEO of a hunger charity is driving an expensive car.

Dan did have an thought provoking point-of-view that keeps ringing in my head and made me question whether or not we are being unfair in expecting charities to be frugal with their advertising and salaries.

 ” You know, you want to make 50 million dollars selling violent video games to kids, go for it. We’ll put you on the cover of Wired magazine. But you want to make half a million dollars trying to cure kids of malaria, and you’re considered a parasite yourself”

What do you think? Is it okay for CEO’s of non-profits to be earning decent incomes? Let me know in the comments below.

Vanessa Rose