In the wake of the 2010 earthquake that hit the Caribbean nation of Haiti, $16bn was raised (including donations from half of all adult Americans) and yet the key objective of the relief work – rebuilding safer cities – was not achieved. On top of that, UN peacekeepers introduced cholera from which a further 10,000 Haitians died. And then there was Oxfam…
The sexual misconduct of Oxfam workers in Haiti was exposed and covered widely in the media. As a result Oxfam lost its £30m annual grant from the UK government, its goodwill ambassadors quit, and individual donations plummeted. Oxfam had a code of conduct in place, they just didn’t monitor it.
Assumptions always conceal potential risks. A lot of UK charities provide help to Bangladesh with quite a few concentrating on child nutrition as poor nutrition leads to poor health and also poor educational achievement. One of these charities spent a large amount of its funding on educating young mothers about feeding their children a healthy diet. However, the programme was not a success and donors requested an investigation. In a typical multi-generational Bangladeshi household it is the mother-in-law who decides what the family eats and so the charity’s effort was largely wasted. If they had bothered to ask the question of any Bangladeshi, they would have been told that they had made a wrong assumption in targeting young mothers.
Tourism is important to the Kenyan economy and wildlife is the draw for many foreign tourists. When news stories started to emerge about farmers shooting elephants that trampled their crops – elephants being no respecters of fences – the government started imprisoning farmers. This was not great for the country’s reputation either, nor for the welfare of poor farming families. A UK charity stepped in and offered to provide farmers with beehives so they could learn to keep bees, sell the honey and earn extra income. More importantly, elephants do not like bees and stay well away from them, keeping the farmers’ crops safe and the elephants alive.
There are over 300,000 charities in the UK and they employ more than 800,000 people (not including volunteers). They compete with each other for the charitable pound and they use the funds they receive to try and achieve their stated objectives, so managing risk should be important to them. Like businesses, government departments, universities, and even parish councils they are required to report on their risks in their annual reports, and they are advised to have a risk management policy and process in place; however, you get the feeling this might be just box-ticking in a lot of cases.
Charities have to understand the risks to the achievement of their objectives, to their income, and to their reputation just as every business has to. And fully understanding the risks can enable them to provide real value like the sweet solution that is Kenyan honey.
Data Sources: Financial Times, The Economist, The Guardian, Oxfam website, TED talks