Restoring trust

Charity must adapt to the marketplace.

By Todd Cohen

[06.30.04] – Charity needs to accept the hand that feeds it.

Despite their good deeds and fierce independence, charities depend on special breaks they get for taking on jobs no one else wants.

But some charities see their special status as an entitlement, confusing it with the right to do as they please.

Some cut sweet deals for boards, kin and cronies. Others throw their weight around. And many whine at the slightest whiff that government might tighten their leash.

Now, fed up with charities’ bad behavior, the IRS, Congress and a growing number of states are cracking down.

A few groups, like the National Committee for Responsive Philanthropy, recognize government needs a bigger stick.

But too many groups, like Independent Sector, the Council on Foundations and United Way of America, fantasize that charity can heal itself, and they downplay greed, arrogance and the fiercely competitive charitable marketplace.

Charity needs leaders who can shed illusions, push for better government policing, and spur public-private investment to boost charities’ accountability and internal operations.

The productive exchange of charitable supply and demand depends on trust.

Only brutal honesty, stronger rules, tougher cops, greater self-scrutiny and better partnerships can restore trust in charity.

Todd Cohen is the Editor and Publisher of the Philanthropy Journal.

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