Friday, April 09, 2004

Is the NKF going overboard in its fund-raising? 

The National Kidney Foundation (NKF) is one of the most successful fund-raising charity organisations in Singapore. That very success is now generating some controversy.

There are actually two complaints making the rounds in Singapore concerning the NKF. One is its tie-up with British insurer Aviva. The other is its accumulated reserves of $189 million.

NKF's deal with Aviva involves the former introducing potential clients from its database of donors to the latter. It will in turn receive $1 million each year over five years when these referrals result in sales. Donors have complained over the fact that they have no say over their participation in the scheme. The Consumers Association of Singapore has already indicated its unhappiness over the deal, suggesting that it should have been made an opt-in system instead.

With regards to the size of the NKF's reserves, the amount of $189 million is apparently enough to last the organisation three years. Most other charities surveyed by The Straits Times only have reserves that can last less than two years. Most people are already aware of the NKF's powerful marketing machine through its frequent fund-raising campaigns. The size of the reserves serves to confirm the perception.

The NKF chairman, Richard Yong, has already responded to the criticisms in a letter to The Straits Times. With regards to the deal with Aviva, he claims that donors particulars will not be disclosed to the insurer. And as for the reserves, the aim is to build up a sufficient buffer so that NKF's programmes are sustainable "for the unpredictable future", he wrote.

While I fully understand the public's criticisms of the NKF over both issues, I also sympathise with the NKF. As far as the Aviva deal is concerned, it happens to be an innovative way to generate additional funds without having to call for outright donations from the public. It is potentially a win-win deal for all parties. However, there is always a high potential for the implementation of such schemes to be imperfect and to leave a bad aftertaste in the public's mouth.

As for the reserves, the NKF is not wrong in wanting to build a substantial reserve. Public generosity cannot always be taken for granted, especially when times get tough. Again, though, the thought that one charity is hoarding most of the country's donated funds inevitably raises the question in the public's minds of whether other charities are being deprived of money.

The NKF's programmes provide important health and financial support for large numbers of Singaporeans. It definitely drives a worthwhile cause. It is unfortunate that its fund-raising activities have caused it to become embroiled in the current controversy.


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