[00:00:00] Odeya: My time in the third sector definitely wasn't perfect, but man, I loved it. Have you ever had a job that you woke up early for, before the alarm went off because you were just so motivated to get the day going? I know most of you haven't had the privilege, and I'm sorry if it feels like I'm rubbing it in your face, I promise you that's not my intention here.
[00:00:19] This was in relation to what was my first real job. It was with animals, so maybe that's it. Animals are always better to work with than people, and seeing an improvement in their wellbeing certainly made the early starts worth it. And also unknown to most, it's also a great way to exploit those who value passion over income, who are blinded by clever slogans, the sweet soft approach and cute social media posts.
[00:00:44] And for a time that was me. I was pacified until I wasn't. I saw some things that didn't look quite right and I began to question to the wrong people.
[00:00:54] I was young thinking I was doing the right thing. Thinking it would right the wrongs of the world.[00:01:00]
[00:01:00] Tale as old as time, I know. No need for the lecture mother.
[00:01:04] Which is why this podcast exists. And I'm not bitter, I promise. I'm just awake. Anyway, turns out corruption within the sector was more common than I first thought. I would see the media publish about it, and then it's soon forgotten because the very thought of this sort of thing unbalances the way we expect some things to go.
[00:01:22] If we can't trust the charities, and those who represent them, who can we trust? So it's better to just pretend it didn't happen, right?
[00:01:30] No, That's not going to happen here. This is Season 1, Episode 1 of Uncharitable. I'm your host, Odeya.
[00:01:43] Fun fact, investment portfolios are not only acquired by individuals, businesses, and the entitled upper class. Charities and not for profits can hold and manage stocks to obtain more boodle too. In fact, a blog post by Intelligent Partnership suggests that charities are reconsidering their investment strategies [00:02:00] to provide additional income as public donations dwindle.
[00:02:03] In the UK, registered charities have a combined amount of roughly 64. 6 billion in investment assets, arguing that these strategies are paramount for their survival. Government funding has been cut and the cost of living is limiting Generosity from supporters, from the public's point of view. Many are uneducated about these strategies and are misled to believe funding automatically goes directly to the appeal they donated to.
[00:02:28] And let's not forget about which stocks they pick. The charity commission in the UK supplies a 43 page guide organizations must follow before investing in the stock market. I won't subject you to this wealth of fun suckery, but I'll highlight what's important here.
[00:02:42] One, the charity commission advises you not to allow your personal motives, opinions, or interests to affect the decisions you make.
[00:02:49] Two, act in compliance with your trustees duties.
[00:02:53] Three, act only in the good faith and interest of your charity.
[00:02:57] Four, only aim for the best [00:03:00] financial return.
[00:03:01] And five, manage conflicts of interest.
[00:03:04] Let me just bring that last one to your attention for a second and provide some millennial wisdom onto you young listeners.
[00:03:10] It is paramount that you avoid throwing caution to the wind when making a choice with investments ethically speaking. If you show interest in a company that may have a negative impact towards what your organisation tackles, that's not a great look.
[00:03:23] A rather ironic example of this would be the Church of England, who in 2013 was revealed by the Guardian to hold an investment with Accel Partners, an American venture capital firm who financially supported Wonga, A payday loan company.
[00:03:38] These loan companies have been criticized for preying on the vulnerable facing tough times. A typical short term loan offered by these companies would usually amount up to the value of 1, 500 to be repaid normally within a three to nine month period. However, these lenders also often charge extortionate interest rates, putting the consumer at risk of long term debt.
[00:03:59] And the [00:04:00] Church of England was rather a vocal critic about this. In fact, they had spent several years campaigning for the reforms to the payday loan market. Previous threats made by the Church's Archbishop included his wishes of establishing a rival network of credit unions to compete them out of existence, only for the Church to be left embarrassed and irritated by the revelation.
[00:04:20] In response to the criticisms it received from supporters and the media, the church withdrew the indirect link to the company soon after. The hypocrisy scandal certainly rattled the cages of the clergy, and quite deservingly so. When leading others, it's important to remember who you represent.
[00:04:37] But unfortunately, It appears something was in the water that year, as a similar story hit the headlines.
[00:04:42] A charity with the vision of a just world free from poverty finds themselves at the centre of a scandal exposing their poor choices when it comes to their investment portfolios, and the name of this charity is Comic Relief.[00:05:00]
[00:05:11] Ethiopia from 1983 to 1985 was not a place you would wish to find yourself in. A country stricken with drought, civil war and military policies saw communities submit to their knees in desperation. Famine took little consideration towards those it consumed as it ravaged through villages and towns.
[00:05:29] Those subjected to malnutrition would experience their skin simply dropping from their bones, fat and muscle would waste away, and their bellies would swell and bloat.
[00:05:38] Villagers would fear venturing outside of their homes knowing their neighbours had perished. Nobody was there to bury them, so it's there that they remained.
[00:05:48] Medical attention became limited due to poor transportation networks and even if you somehow found your way to a hospital, chances were you would be sent away, they simply could not accommodate the communities they were placed [00:06:00] within.
[00:06:01] Horror, exhaustion and neglect spread through the country at a rapid pace.
[00:06:04] Various sources say. Up to a total of 1. 2 million people were lost, leaving behind near
[00:06:10] 200, 000 children. Children innocent and alone, were left to fight the elements, disease and conflict. Their childhood snatched away and replaced with a brutal form of reality.
[00:06:22] A reality. Many of us have thankfully never had to experience
[00:06:26] with the Ethiopian government's lack of compassion towards their own people. Other countries began to take notice. Eyebrows were raised. by The country's alliances, and in the wake of this disapproval, the West began to document the events for the rest of the world to see.
[00:06:42] On the 23rd October in 1984, a BBC news crew broadcasted what they described as a quote " biblical famine of the 20th century and the closest thing to hell on earth" end quote.
[00:06:54] What was shot, shocked the citizens of the UK, motivating them to inundate relief agencies with [00:07:00] donations,
[00:07:01] The attention continued to widespread, influencing celebrities such as Bob Geldof to rally together a supergroup named Band Aid to release the single "Do They Know It's Christmas", released on the 3rd of December in 1984.
[00:07:15] Taking the number one spot for 5 weeks, selling 3. 69 million copies, generating 8 million in donations and polluting my Christmas playlist even still in 2023. The success of the single was soon followed in 1985 with a multi venue benefit concert called Live Aid.
[00:07:32] Broadcasted in 150 nations with nearly 40 percent of the world's population tuned in, it was a revolutionary concept, a true eye opener, and caught the attention of many more who wished to contribute to the cause.
[00:07:49] That same year, shortly after his own experience in Ethiopia, with friend and charity worker Jane Tewson, a British screenwriter named Richard Curtis declared to Jane they could not forget [00:08:00] what they had seen, and returned to life as they had left it. Curtis, best known for his work on films such as Notting Hill and Bridget Jones's Diary, and also fuelling a female's perception of unachievable relationship standards, described the moment he felt compelled to do something in an interview with the Daily Mirror.
[00:08:18] He recalls seeing a tiny child being weighed a sling in one camp, quote, "She was so thin she fell to the hole to the floor and to my surprise all the other children fell about laughing. I thought it was extraordinary that they still had the capacity to find something funny in such terrible circumstances. When we got back, we knew we had to raise money, but I also knew that it was fine to be as funny as we could while we were doing it" end quote.
[00:08:43] The pair agreed, and Comic Relief was born, with the aim of the charity to use humour to raise funds for those in need, primarily in Africa and the UK at the time.
[00:08:54] In 1985 on Christmas Day, the Noel Edmonds Late Late Breakfast show launched Comic Relief live [00:09:00] from a refugee camp in Sudan. Success from the campaign was soon followed shortly after by Utterly Utterly Live, a three night sellout all star comedy show staged at the Shaftley Theatre in London.
[00:09:12] Legend Cliff Richard performed alongside the Young Ones the hit charity single Living Doll, whilst comedians such as Rowan Atkinson performed comedy sketches. After the show, Curtis found himself at friend and on screen comedian Lenny Henry's house, hosting post show drinks, Lenny began to submit ideas to Curtis about how the charity can move forward.
[00:09:34] Speaking to Virgin Radio UK in March 2022, Henry recalls the night the plan came into formation.
[00:09:41] Quote, "One night after Richard's show at the Strasbourg Theatre, we ended up back at my house. I think alcohol may have been taken. Henry said, And I said it should be a night on the telly and we should all be there and we can raise money", end quote.
[00:09:54] In sober words, I think he meant he wanted to host a telethon, partnering with celebrities and [00:10:00] comedians to perform sketches, film inserts and clips.
[00:10:03] He follows on. and recalls the struggles of proposing the idea to those in his address book, explaining that many saw getting involved as a political statement, in which he states, quote, "Of course, everything you do is political, so it doesn't matter, if you want to help, help. If you don't, don't". End quote.
[00:10:22] And it's on this night alone he recruited national treasures such as Julie Walters, Dawn French, Jennifer Saunders, Victoria Wood and Jonathan Ross.
[00:10:31] Red Nose Day became the flagship event for Comic Relief. With the first Telefon, launching in February 8th, 1988, Henry travelled to Ethiopia, equipped with plastic red noses and his signature smile, standing alongside Ethiopian children, he hosted the show with the support of over 150 celebrities.
[00:10:51] The event attracted 13 million viewers, raising 15 million in its first year of broadcast. In the years that followed, the Telefon became the charity's [00:11:00] largest source of biannual income. Broadcasted in the adoptive month of March, Iconic moments became documented and a part of British pop culture.
[00:11:09] Moments such as the infamous kiss between comedian Don French and actor Hugh Grant in 1995.
[00:11:16] Curtis recalls being thankful to the BBC for not cutting to the evening news.
[00:11:20] Quote, "a heroic director stepped in and told them if they cut us off, they would literally be killing people". End quote.
[00:11:28] The Kiss went ahead and contributed towards raising a further 1 million that night.
[00:11:33] At the time of this podcast, both Henry and Curtis remain active within the organisation, with Richard continuing to co produce Red Nose Day, launching the charity in the US in 2015 and helping the non profit reach 1 billion in donations.
[00:11:48] Lenny, although resigned as a trustee in 2017, was appointed as an Honorary Life President for Comic Relief, and can still be seen participating in the odd comedy sketch or ad.[00:12:00]
[00:12:00] In 2002, the charity alongside BBC Sport partnered up to create a second telephone event called Sport Relief. The brainchild of Kevin Carhill, who joined the organisation in 1991 to establish a new department, worked in several job roles before settling on top as Chief Executive in 1997.
[00:12:19] Sports Relief Focus was all about harnessing the power of sport to change lives, getting the great British public to get active, have fun and help raise money that will support people living incredibly tough lives both in the UK and around the world.
[00:12:34] Following a similar program to Red Nose Day, it featured celebrity hosts, guest appearances and special editions of TV shows with an active twist.
[00:12:40] In its first season, Red Nose Day featured a special edition of TV shows
[00:12:42] In The first year, 10 million was raised. Fast forward to 2007 and Kevin Cahill was seen recognition for his efforts by being awarded a CBE.
[00:12:55] It was a good year. The charity set a new record on Red Nose Day for 67 [00:13:00]million, with the next few years continuously outranking the last despite economic downfall. The non profit was on solid ground, in its prime, maintained its major UK charity status, but was also performing questionable practices behind closed doors.
[00:13:15] On
[00:13:24] December 10th, 2013, BBC Panorama, a British current affairs programme, released a documentary titled All in a Good Cause, after a stand off with BBC executives who had ruled themselves out of taking any decisions about the programme due to the long standing ties it had hosting an annual programme slot for the charity.
[00:13:43] The program focused on UK major charities and questioned how well the public knew about those they supported. Writer and host of the program, Declan Lawn, shared what he had learned from supporters and workers, who believed the quest for money was undermining the overall mission.
[00:13:59] At [00:14:00] 10. 35pm, airing just out of primetime, the British public were given an insight into the accounts of Comic Relief and their questionable choices.
[00:14:08] The accusations that arose claimed that between 2007 and 2009, money was put towards investments that appeared to contradict several of its core aims.
[00:14:18] It's important to highlight here that Comic Relief operates as a partner to thousands of charities, it doesn't run its own projects. Instead, it pays out grants to approve projects after a vigorous application process.
[00:14:31] And it's money is usually drip fed, over time, once approval has taken place, to ensure long term support, so this means that at any given time, Comic Relief can hold tens of millions of pounds, and to ensure long term survival, it seeks options to financially stabilise their operations too.
[00:14:49] The charity began using several managed funds who invested the money on their behalf.
[00:14:54] However, poor decisions led to three main industries becoming a part of their portfolio. [00:15:00]
[00:15:02] BAE Systems is a British multinational arms, security and aerospace company based in London that plays a significant role in the production of military equipment. In a blog post by Campaign Against the Arms Trade, they inform that BAE provides defence solutions including combat aircraft, warships, tanks, armoured vehicles and nuclear missile submarines.
[00:15:25] Their sales dominate three particular markets,
[00:15:28] one being the US, accounting for 43 percent of sales between 2017 and 2021,
[00:15:35] two, the UK at an estimated 20%,
[00:15:38] and three, Saudi Arabia at 14%.
[00:15:42] Naturally selling weapons always comes at a cost of human life and accountability continuously falls upon those who provide it.
[00:15:49] The weapons giant came under fire in recent years for its part in the Saudi war in Yemen Where UK newspaper the Independent reported that a BAE supplied aircraft was used [00:16:00] to bomb a Red Cross and MSF hospital in Yemen.
[00:16:03] The chairman of BAE at the time, Sir Roger Carr, rejected the criticism, shooting back a statement, quote, "We will stop doing it when they tell us to stop doing it we maintain peace by having the ability to make war, and that has stood the test of time".
[00:16:19] It must have been these charming words that seduced Comic Relief to invest 630, 000 in shares despite proudly stating on their website of having a long history supporting refugees displaced by conflict, including when they made their first international grant in 2006, just three years before the BAE investment took place.
[00:16:40] And after a hard day's work of making money work for them for a change, nothing helps you wind down like your favourite tipple, right? If you agree, then maybe raise a glass to Diageo, the second company highlighted in the scandal.
[00:16:53] A British alcoholic beverage company founded in 1997, Diageo takes pride in its [00:17:00] ownership over their leading brands, including Guinness, Baileys, and Smirnoff
[00:17:02] accounting their global net sales to just over 17 billion in 2023 does not mean this boozy business conducts sober dealings.
[00:17:11] Tipsy decisions made by the company have led to continuous scandals over the years. My personal favorite includes how the company back in 2014 and 15, materially misled investors about the demand for its drinks By concealing sales of unwanted stock to distributors.
[00:17:28] At least C reliefs 300, 000 investment was safely pumped into the booze giant back between 07 and 09, right?
[00:17:34] And I don't know about you, but I tend to smoke when I drink. It's just a bad habit of mine. We all have them. So how about instead, I should consider spending that money on securing a healthy future for all those little lungs out there?
[00:17:48] That's what Comic Relief claimed to support anyway, only they appeared to be indecisive about which side they were on.
[00:17:55] When it surfaced that the Jesters had given just over 300, 000 to target tuberculosis, [00:18:00] a charity who, like the World Health Organization, recognizes the increased risk of contracting the disease in those who light up compared to those who don't, it was quickly confirmed by Panorama that the non profit ploughed even more into tobacco funds in 2009, an estimated 3 million to say the least.
[00:18:18] As the scandal broke, Comic Relief faced an immediate public relations crisis. The charity released a series of press statements attempted to address the concerns.
[00:18:27] A tough starting point would be admitting the charity still held those investments at the time the documentary broadcasted, but it's okay because it was less than 5 percent according to the CEO.
[00:18:38] On December 11th, Cahill sat down with the Evening Standard, voicing his concerns over the allegations, starting with how the charity holds donations. He said, quote, "We don't sit, such a pejorative term, on any money". End quote. He admitted that Comic Relief did currently have just under 240 million invested, But of that, [00:19:00] around 125 million is committed to long term projects to be released to them over time, while 90 million will be allocated before the next Red Nose Day in 2015.
[00:19:11] He carries on, quote, "We have to manage it professionally. That was easier when bank interest rates were higher, however, since the financial crisis, Comic Relief has been forced to look elsewhere for a decent return". End quote.
[00:19:25] He then refers to the Charity Commission's guide, that their legal obligation is to seek investments that provide the best financial return.
[00:19:32] When mentioning previous ethical investments he claims underperformed. It resulted in the decision to move back to blue chip funds.
[00:19:40] To those who haven't got around to seeing Wolf of Wall Street yet, basically a blue chip fund invests in shares and stocks of well established companies with credible track records of financial performance.
[00:19:51] They are considered the most stable and reliable investments in the stock market, if you can even use the word stable when associating anything stock related. [00:20:00]
[00:20:00] Anyway, He concludes with an announcement of a full review into their investment policy. However, when asked about the consideration of ethical funds, Carhill states, quote, "If ethical funds get bigger and perform better, then it's a no brainer for Comic Relief to put more money into those areas". End Quote.
[00:20:20] The official statement soon follows on for Comic Relief in a more sugar coated format. "Comic relief relies on the trust and support of the public to do its crucial work. We take seriously the concerns raised by the public about our investment policy. All of those decisions the trustees have made over the years, including those on investments, have been made entirely to make sure that we can do the most good to the thousands of vital projects we support. Our policy is in this area, is clearly within the charity's commission guidelines. That said, we should never take public trust for granted and because of some of the issues raised this week, we will look again at our investment policy and hold a full [00:21:00] review".
[00:21:00] Despite the explanation, the public was outraged.
[00:21:05] Many felt betrayed, questioning how a charity dedicated to helping people can invest in industries that in some cases directly contributed to the issues they were trying to solve.
[00:21:15] Soon after, despite initially defending their current policy, Carhill appeared to backtrack.
[00:21:21] The charity began to dispose of the holdings to calm the public outcry, along with a promise to disclose the findings from an independent review within eight weeks.
[00:21:30] At the same time, some of their own high profile supporters, including comedians Frankie Boyle and Al Murray, tweeted on the topic.
[00:21:38] Boyle tweeted, quote, "Will happily perform at this year's Comic Relief, if pained in guns", end quote. With a second tweet following on,
[00:21:46] quote, "Those fairy kates your kids baked for Comic Relief brought you gun and warlord, Joseph Kony, a rocket launcher", end quote.
[00:21:54] With Murray following on, referring to the 1991 charity single in aid of the [00:22:00]organisation, titled "The Stonk", he tweets, quote, "A stonk is a concentrated artillery barrage", end quote. End quote. Nicely put.
[00:22:08] Cahill continued to defend his trustees actions, stating they were acting in good faith in doing what they were doing, and stressing that it's really important that the public stuck with them and trust them to do the right thing.
[00:22:20] The following year in May, after an extensive review into their investment policy, the charity confirmed all investments within the arms tobacco and alcohol industry had ended.
[00:22:30] "Public trust is the cornerstone of the charity", said comic release chairman Tim Davey.
[00:22:35] However, a full ban of unethical companies would not go ahead over the concerns of reduced options available for investment.
[00:22:43] But as a gesture of goodwill and brown nosing, sorry, to demonstrate the organisation's commitment to using its money in support of its core values, the charity wanted to set aside a small proportion of money for social investment.
[00:22:56] After the shaky year, a bruised Carhill sat down with Third Sector [00:23:00] Publication to convince the nation that public trust is still alive and well within the organisation.
[00:23:05] Blaming his lack of knowledge on the matter, Carhill suggests that he simply did not know what was in the funds.
[00:23:10] "I wouldn't pretend to be an expert in this field, he confesses, but we employed brilliant people to say where this money should be placed".
[00:23:19] Typical. Blame the other guys.
[00:23:22] After the inquiry concluded, Cahill reveals the charity accepted all five recommendations which is as follows.
[00:23:29] 1. To no longer invest in companies associated with tobacco, arms or alcohol.
[00:23:33] 2. To continue to set aside a small proportion of capital for social movement.
[00:23:39] 3. Signing up for the UN Principles for Responsible Investment.
[00:23:44] 4. To build stronger links between its investment committee and the trustees to ensure policies are aligned.
[00:23:50] And 5. To be more transparent about its investments in published annual accounts.
[00:23:55] Whatever that means, I'm no expert either.
[00:23:59] In [00:24:00] 2015, the charity finance director Helen Wright poorly attempted to appear humble as she reflected on the scandal. She claimed the decision to divest may have been too hasty, with the concerns raised about the investments having little long term effect on the charity's reputation.
[00:24:15] Stating that the public are less sensitive to things like this said it is sometimes thought, quote,
[00:24:21] "We conducted research both before and after the documentary broadcasted, and in February 2014, public sentiment have rebounded to almost the original position. We also found that many had little or no awareness of the program and in the following month Sport Relief raised a record amount of money" end quote.
[00:24:40] Stepping down from our high horse, she signs off with the acknowledgement that the charity does have a responsibility not to tarnish the reputation of charities in general.
[00:24:49] Had any lessons been learnt here or am I missing something?
[00:24:57] The following year in September, Kevin [00:25:00] Cahill stood down after more than 26 years at the charity and was appointed as the Life President alongside Lenny Henry in 2017. In recent years, Red Nose Day appears to be continuously underperforming. Since 2015, no longer has the telephone smashed records, with 2023 raising just under 32 million, a similar amount not seen since 1997.
[00:25:24] Current CEO, Samwar Patel addressed the concerns for the media.
[00:25:28] Quote, "We're feeling incredibly proud of what the British public have been able to achieve together. There is no doubting that this is deeply a troubling time for millions of people across the nation, so we're truly humbled by the willingness to dig deep and donate" end quote.
[00:25:45] The charity announced it would move to running Red Nose Day every 12 months rather than every two years in rotation with Sport Relief, which would now become an all year round charity campaign. As of 2023, this is the organisation's current mission [00:26:00] statement. Quote, Our mission combines comic and relief.
[00:26:03] "Very clever"
[00:26:04] . We believe that helping others can be easy and fun. Even in the face of challenges we face every day, we believe this because we've seen the power of people coming together to create change over our 30 plus year history. When we come together to help others, we unleash the best in all of us.
[00:26:20] We fund and partner with organizations that support people in crisis, but are also building a better future for all. By focusing on prevention and the root causes.
[00:26:30] Pretty words. I hope they practice what they preach better these days. I'm sorry I'm just I just recall reading the articles in my head and I just, I can't believe, like how does this happen?
[00:26:54] Thanks for listening. It was exciting to finally get this project off the ground and I hope you enjoy what's to come. [00:27:00]
[00:27:00] I hope I didn't disappoint you. If I did, I'm sure you will let me know.
[00:27:04] Either way, consider contributing to the community by leaving a five star review or seek us on Instagram, Reddit or X.
[00:27:12] I've been your host Odeya and until next time.