The Plight of Charities

Read More

The Plight of Charities

It’s been a rough year for charities and my guess is that over the next year, some very worthy organizations will be forced to close up shop. There are many factors working against charities at present:

  • The Christchurch Earthquake has sucked up a huge amount of money from the big charitable trusts, leaving little behind for charities who have in the past relied on those trusts for funding.
  • Government funding for many programmes delivered by charities has been cut back.
  • While revenue is dropping, operating costs are going up.
  • With the economic downturn, more people require assistance from charities and fewer are able to make donations.
  • We are becoming an increasingly cashless society, leading to reduced revenue from street appeals.

Charities are being forced to think outside the square when it comes to funding. At the leading edge are organizations moving towards ‘Social Enterprise’, which is a blend of enterprise, capitalism and philanthropy. They fund their charitable objectives with profit made by selling products and services. In some cases, these organizations are able to raise funds from investors on which they pay a modest return. Social impact bonds, which are being trialled in several countries, raise money from investors to fund delivery of preventative social services. If the social outcomes are achieved, the government pays back the money to the investors and adds a success payment. There is no reason why social enterprise needs to be driven by charities. From the other end of the spectrum, large companies are seeing benefits in applying some of their profits for philanthropic purposes under the banner of ‘Corporate Social Responsibility’. What a different world we would live in if this combination of enterprise and philanthropy became the norm for all businesses, charities and government.

Related Articles

Liz Koh

Budget Winners and Losers

The latest Government budget had something for everyone but while most households will be a few dollars a week better off, there are some clear winners and losers. In the winners’ corner are businesses, those on high incomes, and savers. The biggest losers are property investors who have built large portfolios financed partly by tax rebates.

Read More »

Top Up or Miss Out

The end of June is an important date for KiwiSaver members. The financial year for KiwiSaver runs from 1 July 2009 to 30 June 2010 and if you have contributed at least $1,040 to KiwiSaver during that time, you will be eligible for the full amount of Government tax credit to be paid into your KiwiSaver account in July.

Read More »

Responsible Investing

There is a worldwide trend for investors to want to make a positive contribution to the world by investing in companies that are socially and environmentally responsible. If you are passionate about the effects of climate change, the scarcity of food and water, and social or environmental policies in general, then you will no doubt wish to ensure that the companies in which you invest are going about their business in a manner that is consistent with your views.

Read More »

Helping You Live your retirement To the Max

Keep in touch

Fill in your details and we’ll get back to you in no time.