After the suicide of 92-year-old Olive Cooke, a poppy-seller who had been pursued by a staggering 99 different charities in the last year of her life, the Charity Commission undertook a sample survey of the direct-marketing activities of a number of charities.
The investigation found that an average of 61% of the money these campaigns raised went into the administration of them.
That means into the hands of direct-marketing firms, no doubt making a tidy profit along the way.
If you’ve ever felt faintly saintly for sending back an envelope with a cheque to the Mother Teresa Children’s Foundation, I’m afraid any sheen of sanctimony you may have experienced will now evaporate when you learn that 81% of the value of your cheque went into the administration of the process.
So those are the unpleasant truths about aid and charity. How does that make business the solution?
I started visiting prisons about eight years ago, and wondering why the rates of reoffending on release were so high.
I found the main reason was that prisoners didn’t have a job to go into at the end of their sentence, and so reluctantly fell back into their previous behaviour.
As a restaurateur, when Gordon Ramsay was filming his TV series teaching Brixton prisoners how to cook, I was invited to a lunch they had cooked.
I was particularly impressed by one guy, and told him he could come to my Borough Market restaurant Roast and do some work experience on release if he wished.
He did, and then applied for a permanent position (without my knowledge or interference), and was successful.
The Evening Standard ran an article about this, and we were deluged with letters, emails and calls from people saying they had never been to Roast but now they knew we did things like this, they would start coming.
So the business case for social intervention was verified, giving it legs.
Now you may think that’s a nice little anecdote and no more. But we have inadvertently found we are part of a movement where businesses that are driven by profit through purpose in turn become commercially more successful.
Communications giant Havas has developed one such movement through the creation of its Meaningful Brands programme.
A study of 1000 companies shows that businesses which have social and environmental concerns at their core have a 46% a greater “return on wallet” than companies that don’t.
Largely driven by the millennial generation who will only want to buy from brands that share their values, this is a movement that is only going to grow.
So you need to wake up and smell the flat white coffee if your business is to flourish in this final phase of capitalism.
Iqbal Wahhab OBE is the founder of London restaurants The Cinnamon Club and Roast. His book, Charity Sucks, is being launched by Biteback on October 20
