Re Zane
Paul drew our attention to this charity a few weeks back.
Stay with me, this is a good story as far as Zane is concerned.
Also, all this is just my opinion based on my experience.
This might sound a bit preachy but as investors we can look at charities a bit differently and leverage the effect we can have. After all, we all believe in the efficient allocation of capital. If a charity’s capital isn’t used efficiently, then money is wasted.
About eleven years ago I became a trustee and honorary treasurer of a small charity. Before becoming involved in the charity, I knew nothing about the workings of charity finance. As I became educated I also became shocked at how in some cases only a small the proportion of monies raised can actually end up going to do the actual work of the charity. A pound in the bucket might only mean 30 pence for the front line of the work of the charity.
Charities spend money on all sorts of things. Salaries are an obvious one. Some of these wage levels are too high in my view. Some scandals have arisen as a result of excessive salaries and hidden expenses. (Remember Kidscape?). Some large charities have final salary pension schemes carrying large deficits. Such charities have to divert a chunk of their income into the final salary pension scheme. Whilst making a donation a relatively poor person with not much pension to speak of might actually be funding the pension scheme of some well off middle class people.
Then there is advertising. I had Sky News on the other afternoon and saw ads for 3 different animal charities all doing essentially the same thing. In effect, they were competing against each other for the same pound. TV advertising is one of the things that puts me off supporting a charity.
Some charities these days stray into politics and some of the senior people in some charities are politically motivated (in my opinion). You will all have seen or heard on the media such things as “a report commissioned by charity xxx has found that 99% of children” etc etc. These surveys and reports can cost a packet. You only ever hear of the surveys and reports that give the “right” answer. Money is spent on reports that never see the light of day.
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