The chief executive of Acevo has warned that the media needs to be “less hypocritical” in its coverage of charities following the collapse of Kids Company.
Last week Kids Company closed its doors because it could not pay its debts as they fell due. Its founder, Camila Batmanghelidjh, has since blamed “rumour-mongering civil servants, ill-spirited ministers and the media” for the charity's demise, saying that "unfounded" allegations of sexual abuse caused philanthropists to withdraw offers of funding.
Writing on his blog, Sir Stephen Bubb, said that politicians and the sector need to learn a lesson about running a charity with low overheads and few administrative functions and make sure that charities are supported properly if they are delivering services.
He said that while Camila Batmanghelidjh was a “wonderful character” her determination to keep overheads low and direct all possible funds directly to the children meant that the charity’s overhead costs were “way below what any sustainable organisation should expect”.
“When you couple that with rapid, government-funded growth, which emerged in the wake of significant cuts to government provided services, problems are inevitable,” he said.
He added that: “Batmangelidh’s approach appears to have relied heavily on her indomitable spirit, force of character and charisma. Without the sufficient collateral support of good governance and sound administration, these things, are, simply, not enough.”
Bubb called for “a more adult discourse on what it means to run a successful charity in the twenty first century” and said that: “There is a broad lesson for the media, which must be less hypocritical about what it wants from charities.”
“The right lesson would be to acknowledge that running an organisation that helps people in the twenty first century requires good governance as well as good intentions – and the government must support good governance and high quality leadership in the charity sector if it is to prevent future catastrophes,” he said.
Impetus PEF chief executive: funders need to learn lessons from the collapse of Kids Company
Julia Grant, chief executive of Impetus-PEF, a venture philanthropy foundation, said that other funders should change how they assess potential grantees.
She said: “The dual pressures of growing demand for services and a tougher environment for raising funds and obtaining grants mean high-growth charities may become victims of early success, because they fail to build in the impact disciplines and funding streams to sustain and finance high quality service.
“In particular, Impetus-PEF believe that funders need a fresh view of leadership, looking beyond the value of opening doors and bringing in big cheques to understanding what really drives sustainable impact and growth.”
Grant added that there needs to be a “shift in our approach to charity management and funding,” to encourage organisations to build up reserves.