Setting up a charitable foundation is an admirable goal but it’s not without its pitfalls, says Cause4’s Edward Harvey, who offers some survival strategies…
It sounds great in theory. A charity foundation in your name that goes on helping others long after you retire can be a lasting legacy beyond your achievements on the field. Over the years, there have been notable successes from the world of sport, including The Dame Kelly Holmes Trust, which provides opportunities for disadvantaged young people and has added almost £23 million in social value over the past four years. But there are also cautionary tales of financial mismanagement, rookie mistakes and over-reaching.
When it comes to sports personalities and fundraising foundations, you could be forgiven for thinking, as the saying goes, no good deed goes unpunished. The media love a juicy celebrity charity scandal. Mo Farah, Didier Drogba and Craig Bellamy all set out with the best of intentions to use their wealth and position as sporting heroes and role models to help make a difference in the world, but all ended up running into accounting nightmares and tabloid headlines. For Farah and Bellamy, despite huge investment, their ambitions were thwarted. Farah’s foundation - accused of overspending on “marketing and glitzy balls” by The Sun on Sunday - was in fact profitable, handing over more than £400,000 to a similar charity after folding last year. What brought it down, it seems from reports, was a steady decrease in income after the peak of the post-2012 Olympics, and being too broad in its mission for a relatively small charity – building wells in Africa, running sports sponsorships in the UK and trying to run health and medical programmes in Kenyan schools. Bellamy’s Foundation established a football academy in Sierra Leone in 2008. It provided education and football coaching but closed in September 2016 and is now being looked into by the Charity Commission over financial irregularities, despite Bellamy contributing £1.4m of his own money. Overdue accounts didn’t help either.
The Charity Commission also spent eight months last year looking into the Didier Drogba Foundation, after a Daily Mail piece claimed money raised in the UK was not making its way over to the Ivory Coast. The commission eventually released a statement to say “we found no evidence of fraud or corruption on behalf of the charity.” However, it continued: “We have issued the charity with an action plan to ensure that the outstanding concerns, particularly with regard to transparency to donors and the public, are addressed by the charity’s trustees.” Drogba released a statement to say he had instructed his lawyers to demand an apology from The Mail, but the damage has been done. Transparency and a more direct link between funds raised and deployed would have avoided the scandal.
So how do you avoid your foundation getting bogged down in controversy and mismanagement? From our experience at Cause4, advising individuals and organisations about philanthropy, there is a strong argument for focussing on communities that you already have connections with. LFC veteran Jamie Carragher’s 23 Foundation helps ‘give local kids a chance’ in Merseyside. Part of the Foundation’s work is helping local children with serious illnesses, both with their recovery and to achieve their goals. Carragher’s foundation also helps children worldwide, raising money through the sale of memorabilia, fundraising events and donations. The Alan Shearer Foundation supports people with disabilities in the North East, raising over £2.75m since 2012. The Steven Gerrard Foundation provides additional funding for a range of children’s charitable organisations and projects in the UK and worldwide, but with a particular focus on Liverpool.
Recently, footballers have been getting involved in less traditional ways of giving back to the community. Ryan Giggs and Gary Neville’s donation of living space and food to a group of Manchester’s homeless over the winter in 2015 was one direct action to help with the UK’s housing problem that made the headlines. Bobby Zamora, Mark Noble and Rio Ferdinand are helping to alleviate the current housing crisis by investing in affordable, quality housing. They have presented an initiative called the Legacy Foundation – a project to build 1,300 homes near Luton in partnership with Central Bedfordshire council and funded by Aviva Investors, which includes a sporting academy and coaching for young people.
Going On Loan
Maybe the key to establishing a successful foundation is that old chestnut – training. If you’re going to put your name to something, maybe there are worse ideas than an alliance with an established charity organisation in a similar field first. There are 165,000 charities registered in England and Wales so it’s important to be clear about the value a new charity could add in terms of vision and mission before considering it. It might be better to partner with an existing charity and explore your ideas with them. Learning how the sector works by getting more deeply involved could be mutually beneficial for both parties.