Three-quarters of public say a charity CEO is an admin cost

27 May 2011 News

Research published yesterday by nfpSynergy demonstrates the extent to which the public’s perception of charities is divorced from the reality.

Joe Saxton, driver of ideas, nfpSynergy

Research published yesterday by nfpSynergy demonstrates the extent to which the public’s perception of charities is divorced from the reality.

It also puts into stark relief the challenge the Charity Commission is setting itself by attempting to better match the kind of information it provides to the public, with the kind of information the public actually wants.

At the Charity Commission’s first new-style public meeting in Wales yesterday, nfpSynergy’s Joe Saxton confirmed the regulator’s suspicions that how charitable donations are spent is the biggest thing that people worry about.

“In the sector we spend a lot of time worrying about what fundraising does when it is not nearly as important to people as where the money goes,” Saxton said.

In 2008 nfpSynergy surveyed 1,011 members of the public on how they would classify different types of charity expenditure - whether they would allocate items to administration, fundraising, the cause or not sure.

Three-quarters think a chief executive is an admin cost

The most worrying finding, said Saxton, was that the salary paid to a charity’s CEO was designated as an admin cost by three-quarters of those surveyed, while just 5 per cent would allocate it to 'the cause'. Likewise, almost half of respondents thought a medical research director was an administrative cost.

“I wonder how many of you, when you do your accounts, classify the salary of your CEO as administration or as the cause,” Saxton queried.

“What’s worrying me is what the public’s view of what is administration and what is in most charities’ accounts, I suspect, is quite a long way apart.

“The public love charities but they really don’t understand much about them.”

‘Aggravation index’ of fundraising methods

In another finding, charity shops were seen as a very effective fundraising mechanism by 58 per cent, when in reality, Saxton said, most are “deeply ineffective” as a way of raising money.

“But the public think they’re fantastic.  Tin-rattling outside a supermarket is also highly ineffective but the public thinks that's effective too.

“What this shows is that the public are not totally tuned in with what’s an effective fundraising mechanism. They think telephone calls at home are deeply ineffective. You might say this is an ‘aggravation index’. Charity shops are jolly nice so they must be effective, whereas we hate those intrusive telephone calls at home so that method must be awfully ineffective.”

People also seem confused about charity remuneration. Plenty of people thought trustees and president were paid roles, while most thought street fundraisers were unpaid. Nearly four in five people thought paying a chief executive more than £60,000 a year was very or somewhat wasteful, with only 1 per cent believing such a salary to be worthwhile.  

The answers to a final question about the qualities members of the public perceive charities to have, showed that accountability is one of the biggest areas of deficit between what the public wants from their charities and what they think they get, Saxton said.

“So here is the Charity Commission putting all this time and energy into making sure that charities are accountable to them, and the public doesn’t see it. Only 12 per cent of the public think charities are accountable and only 9 per cent think they are effective or cost-effective.”

Charity Commission faces tough task ahead

Saxton said the findings show the extent of the battle the Charity Commission faces to make the public better informed about how charities operate – “especially when the average person thinks about charities for 10 or 15 seconds a month”.

“As a sector we should be shouting it from the hilltops - the Charity Commission regulates us so you know you can really trust us to spend your money wisely," he added.

>>See extracts from nfpSynergy's presentation here<<




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