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Saturday, 27 December 2008
How Efficient is your favourite Charity?
An interesting article that points out the relatively high salaries paid to executives at some not-for-profit charitable organisations, the under-reporting of how much of the money raised by charities is consumed by fund-raising and administration costs, and how some charities have large pools of donated funds sitting in investments (that have done poorly this year). It appears that some charities are mostly concerned with justifying their continued existence, gaining "market share", and "empire building". While investing a small percentage of the funds raised makes sense in order to be able to maintain a consistent level of expenditure when income fluctuates from year to year, accumulating a large investment portfolio should not be the main aim of any charitable organisation.