‘Charities lose to business when it comes to change’ – Iqbal Wahhab

Kids Company protesting on Whitehall, one of many failed charities

Do businesses incite more change than charities? Director columnist Iqbal Wahhab considers what the public and voluntary sectors can learn from going commercial 

Do you remember CyberMentors? What a great idea – an online platform where kids could get instant advice and mentoring about the digital bullying they were experiencing.

In 2010, they had more than a million visitors and just under 300,000 mentoring interactions. Ministers hosted receptions for its parent charity BeatBullying, it was showered with prizes, plaudits and donations, and we assumed a very 21st-century problem that we didn’t really understand was in safe hands.

The money poured in and, in 2012, BeatBullying received £2.4m – but delivered a £280,865 loss, with no reserves. The following year, a third of the team lost their jobs; they were coalface workers, so that meant a reduction in impact of more than a third. As with Kids Company, no audit was ever made of the loss to kids who had come to rely on them as their go-to place for support.

The following year BeatBullying went bust. I’ve been privy to correspondence between the charity and civil servants asking how best they could justify to ministers how great the project was, more or less putting words into their mouths.

I imagine this happened with Batmanghelidjh, but because BeatBullying’s leader Emma-Jane Cross doesn’t wear big hats and have a long foreign surname, her activities, such as extending into cancer care, are less likely to whip the media into a frenzy of disdain.

Charities’ failure to do good with our money only underlines the unavoidable truth that, in the hands of business, social impacts are more sustainable and much larger. We assume that by paying taxes, governments will use our money to make society fairer, where they can’t and we can, we will top it up with charity.

But, as socio-economic disparities grow, we must see the model doesn’t work. Businesses, on the other hand, as they make a core value of providing remedies, deliver measurable and sustainable social impacts because it is good commercial practice.

Both public and voluntary sectors need to get commercial to deliver against ever-tightening purses. The NHS cuts and closes, rather than engaging in the sort of disruptive thinking businesses thrive on.

Recently the writer Paul Taylor published a post with the eye-catching headline “What if Uber did health, housing and social care”. Facebook creates no content, Airbnb, the biggest accommodation provider, owns no property, and of course the biggest taxi firm owns no fleet.

To those who say that couldn’t work in the health service, he cites Mercy, a hospital with no beds. Nurses work virtually across 33 hospitals and have now extended their reach into individual homes. By keeping tabs on people’s chronic conditions in their own homes they’re freeing up a hospital bed while maintaining the care the ill need.

The Uber approach can be applied far and wide. Local authorities employ thousands of people. But disruptive thinking provides alternatives. Northamptonshire County Council hopes to cut its staff of 4,000 down to 150 and turn into an online platform to service needs through outsourcing. These are sadly rare deviations from the norm.

Charities and public bodies tend to stick their heads in the sand hoping for a magic wand to solve their funding problems so they can carry on as before. Businesses innovate because if they don’t, they have no future. Charities expand by the amount of hope and faith they can convince uninformed if well-meaning donors to finance them with. Public bodies do so with our taxes. Businesses expand through success.

Success wins over hope. Businesses win over charities in their ability to change the world. I’ve been asked to write a book on the subject but you read it here first.

Iqbal Wahhab OBE is the founder of Roast. You can tweet him @IqbalWahhab


Read more on advice for charities

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Charitable trusts need to invest for income, not for a fashionable whim

About author

Iqbal Wahhab

Iqbal Wahhab

Iqbal Wahhab is a restaurateur who drives social impacts to the core of his businesses. The founder of The Cinnamon Club and Roast is chair or patron of a variety of social projects and is planning more restaurants this year.

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