NFPs Should Merge To Survive: Costello

One of Australia’s most recognised and respected Not For Profit leaders has warned that the sector may become unsustainable unless similar charities consider merging.

Chief Executive Officer of World Vision Australia Tim Costello told Pro Bono Australia News as part of the Philanthropy Australia Conference that too many organisations were competing with each other.

“I do have a question about whether the size of the sector is sustainable,” Costello said.

“We do have so many charities competing for the charitable dollar who could be working together and sharing back offices and maybe even merging.

“I do think that’s a real challenge in the sector.” Costello said that World Vision however was unlikely to merge with other charities because of its size.

“World Vision collaborates extensively in the field already and because we’re an international partnership, you know we’ve got 100 offices around the world, it’s a tricky enterprise,” he said.

“I suspect that we’ll see in the domestic sector that merging happening first.

“When you’ve got 10 child leukemia organisations that might be a simpler step. Merging World Vision is like merging the United Nations.”

Costello was a speaker at the second day of the Philanthropy Australia 2014 Conference where he talked about the need to ‘disturb power that is held by men in order to improve the rights of women’, even when it is seen as encroaching on a community’s cultural beliefs.

Costello also said that after 10 years at the helm of World Vision Australia he had thought about retiring.

“I’m getting older, I’m 59 now. I’ve loved it but it does get harder,” he said.

“You fly economy class to Africa and you jump in a jeep and drive on roads that have potholes big enough to swallow a jeep for four hours. So it gets harder when you get older, there’s no doubt about that.

“I’m good for a couple of years but I’m realising that there will be an end.

“As you get older you need to have a succession plan. I’ve got some very good people both internally, and I could think of people externally, who could succeed me.

“We do have a succession plan.”

He also told Pro Bono Australia News that philanthropy was becoming more important in the wake of budget cuts.

“Philanthropy at the high end, I think, really needs encouraging and assistance to flourish.

“I think Australians have been turning inwards. There are job losses and budget emergencies and that evaporates the will to give, particularly overseas.

“You hear a lot more people saying ‘well let’s just look after our own’ and they pull up the drawbridge, and that’s a challenge.

“So right at the moment I think we need to remind ourselves, which is what perspective is, perspective is saying we’re still rich, we’re still blessed.

“Yes we’ve got some troubles and we need to respond to them, but we shouldn’t be cutting aid. Aid’s taken the biggest cut, $7.5 billion of Joe’s (Treasurer Joe Hockey) $35 billion.

“It’s not smart in terms of investment because Asia’s our future and when you cut aid countries remember that.

“From a humanitarian point of view we’re second only to Switzerland in median per capita wealth, so we’re rich.

“So we can say that we are wealthy, we are healthy, but are we wise? Are we wise when you start to cut aid and see people turning inwards and not giving.

“I think philanthropy in this time is incredibly important because governments are cutting aid budgets when we’ve made huge advances.

“When I started at World Vision 10 years ago 30,000 kids would die each day. Today that figure is 17,000.

“We’re making huge progress and now’s not the time to actually close our hearts.”

More than 700 people from the Not For Profit sector attended the two-day Philanthropy Australia Conference where 50 philanthropists discussed the future of charitable donations in Australia.