Our thinking

Core costs, big gains

29 November, 2024

Recent reports have linked Captain Tom Moore and Naomi Campbell in an unexpected and unfortunate way. The Charity Commission found that the Ingram-Moores exploited their father’s charity for personal financial gain, while Naomi Campbell has been banned from being a charity trustee due to misuse of charity funds.  

These are isolated instances, and examples of obvious mismanagement. In light of these events, charity management more broadly has come under scrutiny. Various opinion pieces, including one in The Times, have criticised the sector’s growth as a profession, noting the influx of executives from the private sector into charity leadership roles. 

We believe a more balanced view is needed. First, fairly compensated and motivated employees are much more likely to deliver better outcomes for the communities they serve. Second, charities are under immense pressure, facing the same National Insurance hikes as other employers, which will cost the sector £1.4 billion. Despite this, funding for core costs (management salaries, premises costs, IT) is hard to find with donors understandably wanting their money to go on supporting direct impact. It’s understandable, but these core costs aren’t frivolous – they are what is needed to ensure that the charity can deliver impact.  

Perhaps this is a moment for businesses to reflect on how they can best direct their charitable donations. By supporting core costs and salaries, they can free up charities to seek direct funding for projects from other donors, including the public. Businesses can break the cycle by thinking strategically about where their money is used, recognising that core costs are not frivolous add-ons but essential components of effective charity operations. 

While the misuse of funds by a few individuals is deeply troubling, it should not overshadow the broader need for sustainable charity management. By supporting core costs and fair salaries, businesses and the public can help build a more resilient and effective charitable sector. 

By Alice Railton