Researching, thinking, talking, building, and envisioning in this space is no esoteric investment, a quaint concession or a salve for the guilt of our overextension and collective greed. In this paper, we explore the deep renewal we need in our conceptions of the charitable sector—how we fund, empower, and even define our charities.
IN 2012 CARDUS CONVENED A CHARITABLE SECTOR ROUNDTABLE in Ottawa to examine three questions:
1. What is the state of Canada’s social infrastructure?
2. What role does taxation play in Canadian social infrastructure?
3. What if the charitable sector disappeared?
While aspects of these three questions are still important, other aspects seem prudent to attend to today. On April 28, 2016, Cardus convened another group of leaders deeply acquainted with the charitable landscape in Canada to engage in a structured conversation on the social capacity of the charitable sector. This was not intended to preclude exploration of taxation, legal, and organizational realities, but given the size and extent of the sector and limited time, the core theme of social capacity was the orientation that balanced our engagement and exploration.
The goals of the Charity and Social Capacity conversation were intended to both take stock of our current understanding of the charitable sector and to identify potential pathways for ongoing collaboration in research and policy development. The specific goals of the roundtable were as follows:
1. Move through a set of questions around four core themes over the course of a day.
2. Learn what we are doing, seeing, planning in relation to the charitable sector.
3. Make provisional judgements about the social capacity of the sector today.
4. Identify possible avenues for collaboration.
5. Consider where research, policy, and advocacy resources could best serve the sector.
The following white paper is an interpretive summary of the identified participants who were part of the daylong discussion. In each of the four core sections, a pre-selected participant prepared remarks in advance which were designed to catalyze the discussion for the given section. This is the only direct attribution as the working agreement of the group was to observe non-attribution toward candid and open exploration of ideas.
Each of the following four sections reflect the roundtable discussion framework over the course of the day. The orienting questions for each section further refined our focus on what it means to consider the social capacity and effectiveness of Canada’s charitable sector. In each section a content catalyst brought opening remarks that aligned with the three questions designed for each session and set up the discussion that followed. The structure of this whitepaper reflects that organization.
In the description section we discover that the size and importance of charitable work across the country does not mean we have a clear or complete picture of the basic elements of that sector. Descriptive data about the sector is available but is not always as useful as it could be or as widely used as it should be. The terms and definition we use to define the sector (if calling it a sector is even suitable) will have a significant impact on what we say about it.
Attempts to describe the sector begin to reveal how charity in Canada is structured from a legal, governmental and social vantage point. Some charities are large, pervasive, and almost entirely government funded. The vast majority of charities, however, are neither large nor government funded, and more than half of the charities in Canada don’t have a single employee. Structural demands and needs thus vary widely.
These kinds of variances inevitably lead to distinct differences in power across the registered charitable landscape. Small, local charities tend to be independent so that their high collective numbers do not translate into coordinated action. One result is that large, organized, and publicly funded charities may end up shifting the legal and policy landscape to suit their needs at the expense of the balance of charities.
Finally, the very diverse and even fragmented Canadian social landscape means that a coherent philosophy of charitable activity has been difficult to identify and even more difficult to achieve. Legal definitions provide some common ground, but there are significant differences about what charity is, what it should be, and what role (if any) governments should have in charitable activity.
CHARITABLE INVESTMENTS OF TIME, MONEY, AND THOUGHT across the Canadian landscape are diverse, complex, and substantial. The absence of this network would dramatically reduce our quality of life in Canada and fundamentally change our common notion of civil society.
“Charity,” however, is not well-suited to the limelight. Although common-good activities are essential to civil society, they are seldom sensational. There are no Trudeaus, Trumps, or Putins that engage the volatile interests of spectacle media and novelty sensation. Supporters don’t clash in public rallies; there are no hairstyle cameos, staged boxing matches, or endless exchanges of mutual admiration or vitriol.
Many of these contributions are understood directly and self-consciously as charitable activities. By extension, the organizations that carry out this common good work are called “charities,” and they are given special status in Canada, which allows them to issue tax receipts for contributions made to them.
Despite their unsensational character, the activities of charitable organizations provide meaning, purpose, and belonging amid the dark labyrinths of alienation that characterize our time. We will doubtless continue to fuel our cultural passion for distraction, but the digital bonds that constitute the fuel of distraction are readily dissolved, carry precious little social freight, and are more likely to result in alienation than provide any sort of lasting community. Charities may well be the vital organizing forces that counteract this tendency. Simply observe the office, home, classroom, or trendy café chair if cell signal or Internet connection fails. The resulting paralysis, rage, fear, and dislocation is immediate and substantial. Witness the effect of losing a phone or having it stolen—there is much at stake. The existential crisis effected by such dislocation reflects a challenge for enriched notions of charity—or care for the common good.
In the charitable sector we labour for what we seem to increasingly forget—in a worst-case scenario, our children’s children may come to see civil society as a fully alien social form. To pick up on Alan Weisman’s fascinating concept of a world without humanity (Weisman 2008), we might imagine what our society would be like if charities disappeared, if we suddenly found ourselves in a time when the institutions of thick social experience oriented to the service of a good other than our own were gone, suddenly placed among the archaic social oddities such as duelling and patronage (Allen 2011). Are the socially generative functions of charities essential to the long future of Canada?
In answering the proposed series of questions about the state of charitable function in Canadian society, we are facing an elevated climb daunting in its scale. The enrichment of culture requires that the past and the future are held in a creative, generative tension. When we forget the past or cease to care about the future, dismal social effects follow. It is critical that we take hold of the future without letting go of the past.
The charitable work in our communities is the core arena where our future is being written. Researching, thinking, talking, building, and envisioning in this space is no esoteric investment, a quaint concession or a salve for the guilt of our overextension and collective greed. The few dollars we give to a shattered man sitting outside the local Tim Horton’s makes us forget that as Canadians, 18 percent of us give 80 percent of the common good resources (and it isn’t the top 18 percent that give—the upper-income individuals in Canada provide vanishingly small common good investments, though they speak loudest when they do).
We need deep renewal in our conceptions of the charitable sector. The challenge is how this might be done and the nature of the resources that we have to confront those challenges. While Canada may have a relatively strong legal and formal framework for charitable giving, that framework could be used far more fully and effectively. What’s more, the mechanisms and strategies that would lead to more effective use are unclear and underdeveloped. Translating potential to action remains a significant difficulty.
MILTON FRIESEN Hamilton, Cardus
Milton Friesen is the Program Director of Social Cities at Cardus. He has served a three-year term as an elected municipal councillor and is completing a Ph.D. at the University of Waterloo School of Planning that is focused on new ways to measure the social fabric of neighbourhoods, as well as participating in the Waterloo Institute on Complexity and Innovation (WICI).
MICHAEL HALL Toronto , YMCA Toronto
Michael Hall is Vice President of Program Research and Development for YMCA Toronto. He has an extensive background in research, consulting and nonprofit leadership with expertise in strategy development and collaborative knowledge-building initiatives. He is experienced at establishing and leading national research, evaluation and funding programs and the author of more than 50 publications on nonprofit sector related topics.
RICH JANZEN Waterloo, Centre for Community Based Research
Rich Janzen is co-director of the Centre for Community Based Research (a non-profit, charitable organization) and adjunct faculty at Renison University College at the University of Waterloo. He has been involved in 120-plus community-based research projects on a diverse range of topics.
CARL JUNEAU Ottawa, CRA Charities Directorate (Retired)
Carl Juneau has more than 28 years' experience in the regulation of charities through the Canadian Income Tax Act. This includes experience both in the Agency's Charities Directorate and in the Tax Policy Branch of the Department of Finance, in the areas of policy development, registration and revocation of charities, forms and publications, legislative amendments, and appeals to the courts. Mr. Juneau has also acted as Director of the charities program in the Canada Revenue Agency for several years.
BRIAN EMMETT Toronto, Imagine Canada
Brian Emmett has enjoyed a long and distinguished public service career. He was Canada’s first Commissioner of the Environment and Sustainable Development in the late 1990s and worked extensively on Canada’s Green Plan. He also served as Vice-President of the Canadian International Development Agency (CIDA) in the early 2000s and has been an Assistant Deputy Minister in a number of federal government departments.
MARK BLUMBERG Toronto, Lawyer (Partner)
Mark Blumberg is a charity lawyer based in Toronto with Blumberg Segal LLP and has worked for over 20 years on issues relating to non-profits, registered charities and philanthropy, in Canada and abroad. Mark has written and lectured extensively on these topics. He is the editor of two blogs, namely CanadianCharityLaw. ca and GlobalPhilanthropy.ca™ and he manages charitydata.ca and smartgiving.ca.
ABIGAIL PAYNE Hamilton, McMaster University
Abigail Payne is Professor, Director of the Public Economics Data Analysis Laboratory, and Director of the MacDATA Institute at McMaster University.
DAVID PFRIMMER Waterloo, Waterloo Lutheran Seminary
David Pfrimmer served as Waterloo Lutheran Seminary’s principal-dean for ten years. After stepping down as principal-dean in 2005, he continues to serve as professor of public ethics and co-director of the seminary’s Centre for Public Ethics.
BETH GREEN Hamilton, Program Director, Cardus Education
Beth Green is Program Director of Cardus Education and was previously part of the international research team that developed What If Learning in partnership with Transforming Lives UK/The Stapleford Centre, the Anglican Education Commission Sydney, and the Kuyers Institute for Christian Teaching and Learning at Calvin College in Grand Rapids, Michigan.
GORD TULLOCH Vancouver, Director of Innovation at posAbilities
Gord Tulloch, BA Hons, MA, is the Director of Innovation at posAbilities, a BC-based non-profit that provides a broad spectrum of services to persons with disabilities and their families. His focus is on developing solutions to social challenges that involve businesses and community, and that lead to greater social connection and resiliency.
LIZ WEAVER Kitchener, VP—Tamarack Institute
Liz is the Director of the Tamarack Learning Centre, providing strategic direction for the design and development of learning activities. The Tamarack Learning Centre strategically invests in community leaders to co-generate knowledge and become a collective force for social change.
LYNNE GOLDING Toronto, Fasken—Lawyer (Partner)
Lynne Golding leads the national Health Law Group at the law firm of Fasken Martineau DuMoulin LLP. She has an active corporate-commercial practice principally in the health industry, which involves transactions dealing with public and private corporations in both regulated and unregulated industries.
BRIAN ILER Toronto, CSI Board Secretary and Iler Campbell law firm
Brian Iler is a lawyer, and a partner in the eight-lawyer law firm Iler Campbell, in Toronto. He’s advised and encouraged many of Ontario’s charities, non-profits and co-operatives, and acts as counsel to numerous innovative social enterprises including Options for Homes, SolarShare, Artscape, and Centre for Social Innovation. He’s a founding director of TREC Renewable Co-operative, and SolarShare Co-operative, and director and treasurer of Centre for Social Innovation.
The Canadian Charitable Sector in 2016
- What is the state of the charitable sector?
- How are we measuring the sector, and who is doing this work?
- How should we be measuring it?
WHILE WE HAVE MADE ADVANCES in gathering social and organizational data of all kinds, we still lack a rich and nuanced description of the state of the charitable landscape in Canada. It is a landscape, perhaps more than a sector, because it encompasses informal, non-legally organized, or noted forms of collective action aimed at addressing the challenges we face individually and collectively. However, there is value in using the charitable sector to indicate an organizational space where formally registered charitable organizations are highly represented (Emmett and Emmett 2015).
The not-for-profit sector in Canada is nearly as unmeasured as the charitable sub-sector with which this working paper is concerned. There are approximately 850,000 not-for-profits in Canada, and about 85,000 of those are registered charities. Many of these are not functional entities, though we don’t know how many. Not-for-profits fill out a T1044 form for the Canada Revenue Agency (CRA). This consists of a two-sided document that asks for identification information, revenues, remuneration, activities, and location of organizational documents. A registered charity is required to fill out a T3010 form, which is ten pages long and includes requests for far more detailed information on all aspects of finances, compensation, in-kind donations, along with detailed listings of activities, countries of operation, and a checklist of additional supporting documents that must be provided. Estimates vary widely, but perhaps less than half of not-for-profits and charitable entities are active beyond maintaining their registration status.
Each of these respective document streams is a key source of data on what is happening across the charitable and not-for-profit landscape. The data is often irregular given dependence on the individual(s) filling out the forms and the nature of data collected by the organization. In addition, using the word “charity” obscures the orders of difference between the few very, very large entities (hospitals, educational institutions) and the much more numerous single or no-employee charities. Describing this landscape is hampered by such dramatic variances, and the need for better descriptions, including language sufficient for today’s cultural realities, is well overdue. Description of and language for are aspects of the same challenge. If we cannot define, describe, or explain what is happening in our common-good endeavours, we stand little chance of coming to terms with the value it provides. What do the ten pages of the T3010 and additional pages of documentation fail to include in their reporting requirements? What aspects of the common good are not measureable by these means? This is seldom reflected on in a systematic way.
For example, it has been observed that if governments fund charities directly, those charities are really extensions of the government—it is government pursued by different means, a charitable legal status. When we attempt to describe the sector, we will need to be more clear about this internal dynamic. Budgets or programs based on government funding are often consolidated for reporting convenience, which signals that the entities in question have become direct extensions of government policy. This is most clearly seen in health and education but can also occur in other sectors such as public policy research, where organizations such as the Canadian Urban Institute are fully funded by the public purse while other public policy organizations such as Cardus are fully funded by private donations.
The important commonality is that charitable entities are deemed to be unique in that their direct and specific function is the benefit they provide to the public good. In some cases this linkage is clear—for example, providing housing to people whose life challenges have made it difficult or impossible for them to work to pay for their needs. Establishing just what these public goods are and how many have been generated in each case has been the core preoccupation of people measuring social impact. This is a subset of the descriptive challenges facing charitable organizations in Canada.