This week you will notice a fresh header on my column.
I was excited when Castanet asked if I would consider revamping the column a little which allowed me the freedom to talk about my other passion - charity!
As I discussed with a few people how I could title the column and create a new graphic, the thought came to mind it should be called The Accidental Journey. I find it a thought provoking title, not least because I don’t personally believe in accidental journeys, but more importantly it is hard to conceive of ourselves being in certain situations by desire. Today however, many of us are challenged with a set of circumstances we have very little control over.
As a REALTOR I will continue to update you on the real estate market from time to time, but in between that, I hope that I can entertain you and engage you in other discussions that I feel are important.
The past few weeks a very interesting video has been going viral. It is a TedX talk which is usually thought provoking... you can find the video here.
As a capitalist who has lived his life as a self employed entrepreneur, the topic of Dan Pallotta’s discussion resonates with me. However, when applying capitalist principles to charitable endeavours, I find myself struggling with the concept.
Perhaps it is the number of UN salaried workers with competitive compensation plans and large expense accounts who I have witnessed gathering in 5-star hotels in Nairobi burning through $450 per night rooms, while my wife and I stay at a perfectly comfortable 3-star flying club for 1/8 of the price because with the change we can save more lives.
The title is great and his topic is naturally very engaging and TedX is not designed for you to agree with the presenter but to debate the topic.
What I find interesting in his presentation is the presumption we attract a larger gene pool of talent with higher salaries. This is where, I feel, personally, the philosophy breaks down. Do I wish that as a CEO of a charity you could take home a decent pay cheque? Absolutely. Do we need to pay $500,000 per year so that we can attract a Harvard graduate? I don’t think so.
Dan suggests between the lines that putting somebody in the driver's seat who commands a $500,000 per year salary would solve our problems. Didn’t people making $500,000 per year just destroy a world economy? I don’t think the middle class carried enough decision making ability to package toxic assets and knowingly sell “sour” investments to any sucker that walked through the door. That plan was designed by a $500,000 per year genius. Is that the guy or girl we want running our charities?
The flaw in the philosophy I think is, what motivates a person to work? The good ‘ol US of A believes that money is the sole motivator. If that is the case then I can’t help but believe that the $500,000 a year executive is more interested in what street they live on and what car they drive and where they go to lunch than they are about how many lives they have effectively saved. The whole philosophy behind corporate social responsibility is something other than a fiscal bottom line, it is a “triple bottom line”. At CSR’s roots is a belief in the person, the social fabric of the world and the environment.
The big question is can somebody on a lower salary deliver the same results and my answer is resoundingly YES. It is because passion drives charity, not capitalism.
For sure, charities can learn to do business differently, but capitalising risky fund raising adventures with borrowed money is not on the cards for 99% of charities because they are too worried about sustaining the commitments they have made to help people in need.
The other side of the coin is would the public donate to a charity with a board of directors creaming off $500,000 each because they were highly intellectual capitalists and well educated? Well the proof is in the pudding, Dan Pallotta himself shut down his own fund raising company Pallotta Teamworks in 2002 because of a massive public outcry over the cost of his productions!
Therein lies the problem, the hand that feeds a charity, the public, demands more accountability than we get in the free enterprise world. In the free enterprise world, companies are able to collude and manipulate markets freely and if, combined, they have a monopoly, the free enterprise system breaks down, as it just has to a certain extent. The philosophy that free enterprise drives competition is fine until one percent of the worlds population owns most of the wealth, then the rest of us are just pawns on the chess board and we lost! That is not acceptable to charities.
My final thought was around one statement that Dan makes in the talk which is that a $500,000 a year executive is better off staying in the free enterprise market place and donating $100,000 a year to charity and benefiting from a tax receipt than he or she would be taking a pay cut and running a charity. Frankly, Amen to that! If executives bucked the average and donated that ratio of money to charities, then charities would not need to undertake risky and capitalist oriented fund raising programs. I hope that CEO’s can make as much money as they are able to in the private sector and make larger donations to charity, the public would love them!
More The Accidental Journey articles
The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet presents its columns "as is" and does not warrant the contents.
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- How low can you go? Oct 3
- Finding the smart money Sep 26
- Disruptive innovation Sep 19
- Brangelina and Celebrity vs Philanthropy Sep 12
- Managing your personality Sep 5
- New Real Estate Brokerage in town Aug 29
- What is a journey without a destination? Aug 22
- Going home to a bully! Aug 15