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Just For Nonprofits: Athletes’ Charitable Foundations
Recent news has shed bad light on some celebrities’ charitable foundations, the kind of bad press that often contributes to the unfair general distrust of charities. A look at some of the issues can give us all a better sense of the message our donors are receiving in the mass media about nonprofit organizations, while also reminding us of our due diligence in our work and in the work of our affiliates.
A 2013 investigation by ESPN’s Outside the Lines reported that nearly three quarters of the professional athletes’ foundations it looked at were not meeting standards set by watchdog organizations in transparency, governance, or efficiency. Many were up to five years behind on tax returns or had submitted incomplete or incorrectly completed returns. Often, high-salaried athletes set up charitable foundations as tax strategies, but their involvement in the work itself is negligible at best. In more egregious cases, foundations employ family members or friends of the athletes, paying them for work while the foundations themselves don’t appear to do any charitable work. In some cases, while the work itself is laudable, the percentage of donations that go directly to the work reveal inefficiencies, even with everything above board.
Yet many athletes’ foundations are among the highest rated. Watchdog agency Charity Navigator gives the Tiger Woods Foundation its highest four-star rating, evaluating the organization’s financial practices as well as its transparency and accountability. The foundation, which supports “college access for underserved youth,” has a higher rating than the Girl Scouts of the USA and the Boy Scouts of America, two of America’s highly esteemed nonprofit groups. Woods’ foundation is not alone: many online publications print annual “most charitable athletes” lists, celebrating the off-field work of Andre Agassi, Lance Armstrong, and Doug Flutie, whose foundations are rated three stars or better by Charity Navigator.
Foundations attached to celebrities have the benefit of high-visibility, a double-edged sword that raises awareness for important causes while also riding the volatility of public perception of these celebrities. A scandal completely unrelated to the charity itself can bring an unwanted affiliation when a celebrity’s behavior receives negative attention. Beyond this, there may be deeper issues when partnering with a celebrity-related nonprofit: a celebrity’s sterling reputation doesn’t mean the foundation itself is competently run. As an example, Charity Navigator has a list of 10 seemingly arbitrarily selected celebrity charities, with their ratings and links to more extensive reports. Some of these groups score highly, such as baseball executive Tony LaRussa’s Animal Rescue Foundation and the Christopher and Dana Reeve Foundation. Others don’t score quite as highly.
The pitfalls of living a public life are as well-known as the benefits. Similarly, there are pitfalls and benefits in affiliating with the charitable foundations of professional athletes. Because public awareness of some causes is related to the public’s perception of the athletes, it’s worth keeping an eye on the work of these athletes whose charitable reach extends into our realms. If it’s true that a rising tide lifts all boats, then the opposite would also be true.
Reference Links:
ESPN Outside the Lines report: http://www.espn.com/espn/otl/story/_/id/9109024/top-athletes-charities-often-measure-charity-experts-say-efficient-effective-use-money
Charity Navigator’s 10 Celebrity-Related Charities: http://www.charitynavigator.org/index.cfm?bay=topten.detail&listid=22
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