Dear Reader,
I sit here at my laptop
semi-heartbroken writing this. So forgive me now for a few tangents that we
might go on together on this edition of Fat
Guys’ Rants. I am venturing into two areas that are so profound to me that when
they merge I see it as a glorious event… for the most part. Those issues are
Public Non-Profit and Veterans’ Rights/Care.
I am a HUGE proponent of
Veterans’ Rights/Care. Today, we see a lot of media coverage (not near enough
for my tastes) about Vets who need help, not getting enough help, or getting
help. Houses, jobs, counseling, prosthetic limbs, cars, and a laundry list of
other things. When I see something in the media surrounding these issues, I
read it and do my best to share it, good or bad! For every positive article
about a Veteran getting help there are two stories about Vets who are in dire
need of something. EITHER WAY, there is press coverage that I feel we all need
to be aware of.
A vast majority of the
negative stories we hear about are centered on the Veterans Administration and
their downfalls and issues. A vast majority of positive stories are focused on
non-profit causes and organizations that have stepped up to fill the gaps that
are being caused by governmental and societal breakdowns. I work in the
non-profit world, so I am pretty aware of the ins and outs of how these
organizations operate and report their successes.
So today a reader of our
blog sent me an article and asked my opinion on it. The article was published
by The New York Times and written by
Dave Phillips. Here is a link to it: http://tinyurl.com/jdowxch (I created a tiny URL
for it). The title of the article is “Wounded Warrior Program Spends Lavishly on Itself,
Insiders Say.” I actually hesitated opening the article because I
didn’t want to see what Mr. Phillips wrote and when I finally did click on it,
I was dead set to disagree with what he wrote before I read one word. I read
it… a couple of times…and now I am the definition of “torn.”
The article highlights
some of the perceived crazy spending that this organization (WWP) does; $7,000
on last minute flights to Germany, 500 employees staying in a 5-star hotel for
a corporate retreat, business class flights for minor meetings, and $500 per
night hotel rooms just to name a few. Mr. Phillips also disclosed that the CEO
made $473,000 in 2014. Another part of the article was focused on the employees
who were dismissed for what the employees said were less than fair reasons or
for minor issues.
What strikes me to the
core is that WWP spends 40% of their income on overhead/administrative costs.
In 2011 Charity Watch gave WWP a rating of D and has not given them a rating of
C or higher. That is an issue that bothers me, and I want more information on. Anyone
can look up the financials of WWP or any 501c3 for that matter. For WWP go to http://www.woundedwarriorproject.org/media/879225/2014_form-990_wwp.pdf and it is all right
there, but it doesn’t tell the whole story.
I am not bothered by the
$400,000+ salary of the CEO. I would think we would be hard pressed to find a
CEO in the private sector that has the budget volume ($342mil in 2013),
employees and responsibilities that WWP has under $500,000. I am worried about
two issues that the article brings up… the 40% overhead and that the CEO wants
this non-profit to “run like Starbucks. It is NOT Starbucks, and please do not lose sight of the mission and
focus more on the fundraising. The article suggests that WWP is greatly out of
balance in this area.
I have always been wary
of any 501c3 non-profit who has admin costs more than 20%. I just do not see
the justification of it. I can now see that some part of the 40% is being spent
on defending that they spend 40% on admin/overhead on PR and lobbyists! This seems
like a “rabbit hole” that should be an issue to anyone who gives to WWP.
Now with all of that, I
have to think of the mission. “To Honor
and Empower Wounded Veterans” That seems simple enough. WWP does a LOT of
amazing things. They have programs that never existed 10 years ago and help
fund hundreds of other organizations and endeavors that have the same mission.
Would the world be better off without WWP? Absolutely NOT. Could they “honor”
the men and women that they help every day by being far more judicious of their
spending? Absolutely YES.
What is “Good’Nuff” when
it comes to the dollars we give to non-profits to help with causes that we are
passionate about? Is it ok to know that they spend 40 cents of every dollar on
what seems to be lavish perks when we all know that there is FAR more that is
needed in this segment of our community? I do not think it is. “Good’Nuff” is
NOT what needs to happen with the dollars that we give. “Good’Nuff” is NOT what
we expect.
I have given to WWP in
the past. I have given my time and money to WWP. I still want to, but I need
you guys to be dedicated to honoring us as well. Honor us by giving us the
peace of mind that the monies that we give to are used the right way. Be
ethical, diligent and disciplined. Do not be “Good”Nuff” with your mission. Keep
doing what you are doing… only better. Please.
Couldn't agree more with your post. What I struggle with, though, is the amount of focus people give to the percentage of a charity's budget spent on overhead. Numbers aren't that simple. I've seen small charities with large percentages spent on "overhead" (if we want to make that term simplistic) and large charities with small percentages spent on "overhead." Just the simple size of an organization can skew the numbers for or against them. What's worse, though is that the media and public have put a ton of fear in charities about their numbers and percentages, to the point that some charities feel a need to bake the books, stretch the figures or re-classify them to be more attractive to the general public who doesn't understand the bigger picture. Just yesterday I had one of my charity clients say, "We can make the numbers say what we want." Some charities brag about having only 10% of the funding go toward admin and fundraising with 90% going to programs. What I want to know is whether those programs are well run, what the short-term and long-term impact is, and what type of leadership runs that organization and keeps its very own nonprofit employees out of the starvation cycle. Are its own employees making a living wage, or are they dependent on other social services because their nonprofit won't pay them what they're worth out of fear it will "skew" the numbers? Granted, I don't condone lavish expenditures. I also think we as a society need to ask the hard questions, not the surface ones like, "How much of your money goes to overhead?" I want to know what that overhead consists of and if there might be a reason for expenditures that appear lavish but perhaps made sense for whatever reason. I want to know the true cost of doing critically important work for the betterment of society. Maybe then all of us can have a real conversation.
ReplyDeleteWow! Your reply was almost as long as my Rant!! :o) Impact is the part that has me torn about this specific organization. I know that their impact is amazing, but is there line that excuses them from over spending on stuff based on their impact? I worry that could end up being a good hiding hole that they can use and actually it seems as if that is what they are doing right now.
DeleteAny more, if the 'government' is involved in a project, as this one certainly is, then there will be big trouble, lies, fraud, murder, deceit, you name it you got it/! As simplistic as it sounds anymore, I do not trust anything that the gov is involved! My story is short but it tells how I feel but not what to do about it as I DO NOT KNOW!
ReplyDeleteMy reply was a rant :-)...perhaps this can become the "Fat Guys' and One Short Girl's Rant."
ReplyDeleteThanks for addressing a sensitive subject. Dialog is where it beginsays with this stuff, so if there is anything positive to come from this, I hope it's some reflection and change at WWP, some candid dialog about The Overhead Myth, and a more informed public about how to conduct meaningful due diligence before making a charitable investment.
Impact doesn't excuse bad decisions, lavish spending, or poor HR decisions.
Here's a video I love that touches on these issues in a provocative way: https://www.ted.com/talks/dan_pallotta_the_way_we_think_about_charity_is_dead_wrong?language=en