A career in the charitable sector comes with a lot of misconceptions, including the belief held by some that “Geoff Eaton’s a crook.”
Despite the goodwill of charitable supporters and the belief that “it’s a great cause,” the trust and belief we charities are afforded on the revenue side is sharply contrasted with the treasonous accusations levied on the expense side of our organizations.
Three things you need to know about the expenses of charities:
1. Compensation expenses say nothing about the impact of the charity.
2. Ratios are misleading and a source of comfort—or discomfort—when you don’t want to dig deeper and learn how a charity operates. (Please take a few minutes to review our annual report and financial statements)
3. The total dollars spent or program ratios are no indication of actual impact on the lives of people.
The same dude who called me a crook numerous times in an online forum cited YACC’s super high compensation costs. Last year they were 57 per cent of expenses.
No. YACC runs programs to support young adults living with, through, and beyond cancer. We run them. We pay people to run them. We could bring down that 57 per cent to 20-30 per cent by out-sourcing our programs to other organizations, and it’s not the approach we decided to take. We develop and deliver our programs. Compensation says something about the approach charities take, nothing about the impact they make.
The hunger for fund development ratios is driven by our human desire to make giving easy and understandable. There’s nothing wrong with wanting to learn more about where your money goes, but it’s an unfair reality as there is no standard approach for calculating these ratios. We use timesheets to allocate human resources expenses, our biggest expense. Most charities, I’d suggest, use other ways, but the media continues to drive for these simple metrics to communicate a complex situation. So that’s the gauge we all use.
The ratio gives no indication of actual impact. Program expenses of 70 per cent or 45 per cent can’t tell you how nutritious the soup is, how powerful the retreat is, or how the lives have been changed.
I’d gladly trade a little trust when raising revenue for even just one minute to explain the fundraising or administrative ratio you are questioning. In fact, it would be great if everyone spent more time digging in to the charities they support before sharing uninformed opinions.
It’s a tightrope we walk as a charity. It’s one we walk as best we can. This past year of YACC’s life has given me even greater appreciation for all those engaged in this sector as faithful donors, engaged volunteers, and committed employees of Canada’s 85,000 charities.
If it was easy everyone would be doing it, and they would be good at it. It’s not, and they are not.
Get in touch if you ever have any questions about how we support young adults as they live with, through, and beyond cancer.
Live life. Love life.