Calgary Social Voice

Sharing ideas on social issues in and around Calgary.

The way we think about charity is dead wrong

March 14, 2013 · Posted In: Difference U Make
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Next month, Dan Pallotta is coming to Calgary. You’ve probably heard Pallotta’s name somewhere this past week — his provocative new TED Talk, “The way we think about charity is dead wrong,” is getting a lot of attention. Pallotta recently spoke with the Calgary Herald in advance of CCVO’s Connections conference in late April:

[Pallotta] says we too often look at the overhead involved in fundraising events such as races or dinners and say it’s too high, that we’d rather donate directly to the cause.

The problem, he explains, is we rarely do — without the event, we lose the incentive to donate.

“(We’ve) trained people to think that overhead is bad and is somehow not part of the cause, but it is, especially if it’s being used for growth,” he says.

He believes non-profits are often too small to effectively solve the social problems they’re dealing with, such as homelessness and poverty.

“The big picture is that these social problems are massive in scale and these organizations are tiny up against them,” Pallotta says.

See Pallotta make his argument in the TED Talk below. The talk is less than 20 minutes and worth the time:

What do you think? Do you think Pallotta makes a good point? Leave a comment and let us know!

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  • Kelcie

    Great message. By re-evaluating the questions we’re asking non-profits and thinking big picture about how contributions of time, effort and money are changing the social landscape instead of concerning ourselves with the minute details of how each of our personal contributions are being used, the impact that can be made in Calgary would grow exponentially. Just as we trust the products we purchase from corporations, we need to start trusting and valuing the social sector.

  • Jeremy K.

    Dan Pallotta is frustrated with a lot of the comments he’s seeing under the TED Talk video. Here’s what he wrote earlier this week:

    “If you look at the comments section, there are a lot of traditionalists who have simply ignored the talk and are preaching stale, cynical rhetoric about how nonprofits waste money, people in nonprofits shouldn’t make money, telling stories about charities they’ve heard of that are committing fraud, etc. And our voice is not there in near the strength it ought to be offering a rebuttal.

    “WE CAN NO LONGER CONTINUE TAKING PUNCHES TO THE FACE LIKE THIS.

    “We must defend ourselves and our work and offer the world a new vision of possibility.”

    His full post is here: http://blog.danpallotta.com/post/45183611212/call-to-action-please-add-your-comment-to-the-ted

  • Sam B.

    I think Dan Pallotta hits the mark with this speech. There is no room for innovation when non-profits are trying to keep “the demonic label of overhead” as low as possible to appear more efficient. We need better ways of defining efficiency and supporting non-profits to make their organizations successful. We’ll never be able to tackle the mammoth social issues that exist both locally and globally if we can’t, collectively, change how we think about charities.

  • Kate

    One of the many points I took away from this was that in order to engage and include people in your initiative you have to ask them to join, and how can you ask them if you don’t reach them. Marketing and advertising are very important, and an important place to spend money. This video is great! It’s worth watching several times!

  • thegoid

    These are all valid points, however can anyone sit with a straight face and say the CEO of a non-profit should receive a million dollar salary? it seems corporate greed has a face, no matter the industry. What I would like to see is some of these people who signed up for a good cause take a hit of their own. I don’t make millions a year, but I donate to charity each year. What I find frustrating is giving money to an organization that is undeserving because of their business practices. I have no problem giving money to the charity, but I do have a problem giving such top heavy compensation to the people who run the charity. My friend works for boys and girls club, makes $40K a year and loves her life. You should get enough gratitude out of doing the job that you don’t need a million a year. Seems just because you have a 3 letter title you deserve such huge salaries. Give the money back to the charity!!

  • 13Smith

    If it meant that a charity could bring in gross revenues over $100 Million a year, couldn’t that be worth $1 million salary? Good people are often asked to choose between living a comfortable lifestyle or risk coasting along the border of poverty themselves. At $40,000 a year, you cannot easily live in a city like Calgary. With housing costs for single family dwellings at $1,500 – $2000 per month (rent, utilities, etc.), you quickly burn through more than 30% of your income. Pay for food, transportation, clothing, grooming, school fees, and so on, and the rest depletes quickly without leaving much, if anything for savings. Given the choice of doing the same job in the For-Profit Sector at three or four times the salary…it’s not really a choice. I don’t think people running charities should profit off the misery of others, but they also shouldn’t be asked to put their finger in a dam that’s bursting with their hands cuffed behind their backs.

  • girlfriend yyc

    Made me think about the way I think, which I guess was the point.

    A few years ago I was “disgusted and shocked” by an email sent by a friend that shared some “facts” about charities that were giving their top brass exorbitant salaries and other fancy perks. Shaking my head, I forwarded it on to my network. Really felt like I was doing the “right” thing: “People need to know about this!”

    One person replied that the email was an urban myth. He worked at one of the
    charities mentioned so I was skeptical. Did a 5 second Google search. Turned
    out he was right.

    I still see that email now and then. And I still wonder why I was so quick to
    believe. Guess I was guilty of the same thought process this video is trying to
    change. I know, I know, one inflammatory email isn’t what Dan is talking about.
    That’s small potatoes when he is talking about large-scale impact. Or is it?

    In thinking about it, that ‘one’ email has probably been seen by millions of people, and will be seen by many more. That’s a lot of impact isn’t it? And what about cost? I wonder what the cost of that ‘one’ email has been, in terms of dollars and reduced (?) social impact, let alone in terms of reputation. After all, it would surely be challenging to have a bad reputation and be uber successful on the financial front, non?

    The difference is, the social sector relies on money to help people and improve lives. A loss of reputation and financial capital means far more than less profit and leaner times. And it probably costs us all in the end, but how to calculate the “actual”
    cost to society?

    My biggest takeaway from the vid? Profit isn’t a bad word. Nor is it uncharitable. It’s just good business. For all of us.
    Guess I better get on the email to the network train again. Once again I have that feeling: “People need to know about this!”….

  • Holly H.

    I work in the Not-For-Profit sector in Calgary. This video hit home for me, and the struggles our organization faces in overcoming stereotypes and an outdated school of thought around philanthropy.

    I showed up last fall to speak to a business in Calgary who was developing a young-professionals philanthropy network. I was fortunate to be asked to speak to the committee and brainstorm with them ways to get their young professionals involved in our important work in the community. I spoke to a small room of employees in their mid-twenties and early thirties about the importance on their involvement and buy-in to our cause. We afterwards spent time brainstorming and creating plans for larger involvement in their organization.

    What strikes me about the public speaking engagement that day was a woman who approached me after the talk. She inquired about my purse. I was carrying a white leather satchel that had been a gift from my parents at my recent birthday – a beautiful bag I felt fortunate to have. The woman told me that if I had a bag that nice, I must be making a big salary. She wasn’t going to donate to a company that paid their employees so much money that they could afford beautiful handbags. In the moment I was so shocked I had no rebuttal. I’ve played that moment over and over again in my mind. I wish I could have another chance to answer the misinformed woman, and educate her versus defend myself and my organization. What I would have said wouldn’t have been as eloquent or as well researched as Dan’s talk, but I would have attempted to hit on the same themes.

    I belong to the millennial generation hitting the work force in astounding numbers. We’re changing the way business works, influencing and driving new ways of thinking everywhere we go. We have the chance to change how people think about charity, starting with debunking the commonplace myths. We can make our lasting legacy “We changed the world”-but as Dan says, we first must change the way we think. That reminds me of artist Mary Engelbreit’s famous quote: “If you don’t like something change it; if you can’t change it, change the way you think about it.”

  • gmmj

    Yes, everyone should listen to this–funders too– who don’t like funding overhead.