Kevin Cahill of Comic Relief: 'There is still public trust in us as an organisation'

The chief executive of the red nose charity talks to Tim Smedley about its history, its methods and getting through a recent scandal

Cahill believes the charity sector is enriched by Comic Relief's existence
Cahill believes the charity sector is enriched by Comic Relief's existence

Kevin Cahill admits that when he joined Comic Relief in 1990 they were still making it up as they went along. He arrived from the National Theatre, where as head of education he persuaded stars such as Anthony Hopkins to speak to groups of school children about the theatre world. Glad-handing stars and entertaining the public proved a useful training ground. He joined a team of 20, licking envelopes alongside the founder Richard Curtis, and riding the wave of goodwill for celebrities trying to change the world that had begun with Live Aid just five years before.

Fast-forward to 2014 and Comic Relief is no longer making it up as it goes along. The full-time team is 277 strong. The grants it has distributed total more than £900m; the hope is to break £1bn next year, coinciding with the charity's 30th anniversary.

Its practices are now scrutinised much more seriously too. A BBC Panorama investigation in December 2013 found that some of Comic Relief's investment capital – the interest from which is central to the "Comic Relief promise" that no money from donations is ever spent on running costs – could be found in some unsavoury places. In 2009, Comic Relief invested £310,000 of public donations in shares in the alcohol industry, £2.7m in tobacco and £631,000 in arms (in the guise of BAE Systems).

These investments were in pooled funds, where the precise stocks involved are not always clear to the investor. But Comic Relief was left more red-faced than red-nosed. The joke of "being funny for money" suddenly fell a bit flat.

With one hand, Comic Relief was giving grants to charities dealing with smoking-related diseases in Africa or helping British teenage alcoholics; with the other, it was injecting money into the very companies that provided the killer products.

The fall-out from the programme "shook the organisation and shook me", says Cahill. Yet Comic Relief's initial response struck many as unapologetic. Peter Bennett-Jones, chair of the charity, publicly defended the investments, claiming it was a fiduciary duty to "invest for the best possible financial returns". Cahill told the BBC's World at One that "trustees had acted in good faith" and within the Charity Commission's guidelines.

But had he or the trustees ever looked at the investment funds, seen the likes of BAE Systems and Imperial Tobacco and questioned how that aligned with the charity's mission? Cahill suggests he simply didn't know what was in the funds.

"I wouldn't pretend to be an expert at all in this field," he says. "We employed brilliant people in this field to say where this money should be placed. Our view was that being in managed funds, where any level of investment in any particular issue or area is always going to be small because it is spread across a wide range of investments, was an appropriate place to be."

'Working harder at transparency'

Despite having now had plenty of time to reflect, his stance seems little changed. "When you are custodians of a large amount of money, and that money is pretty much all pre-allocated, you have a responsibility, first of all, not to lose any of it," he says. "You also have to try to get a good return for that money. The thing we learned from this was, like everyone, we could probably work harder at signposting and being more transparent.

Comic Relief has since accepted all the recommendations of an independent investment review, announced by Cahill directly after the Panorama programme.

These include signing up to the UN Principles for Responsible Investment, screening out funds to avoid reputational risk and investing more capital for social investment. The review pointed out in passing that "press coverage of this programme changed the landscape of reputational risk for Comic Relief". The charity is now in the process of appointing external asset managers and says it will make sure that the processes for screening that are put in place are clear, robust and in line with the trustees' mandate and instructions, although exactly what those processes will be and how they will address the key question of monitoring pooled funds remain unspecified. Cahill's view is simply that lessons have been learned and "it's time to move on".

Arguably, the British public has already moved on. Sport Relief – the more athletic brand of fun, first launched by Comic Relief in 2002 – had its most successful year this year, raising more than £70m. "There's no sense of complacency," says Cahill. "But what cheered us up is that the first time we'd gone back to the public since it all happened, they remained very supportive of us. That tells us that there is still public trust in us as an organisation and the changes we've made, which we were very public about, have had a uniformly positive response."

Comic Relief's relationship with the public is the envy of many. Although it is a huge grant-giver (£33m and £75m in 2013 for the UK and internationally respectively), a question that does nag the wider sector is whether the money it raises comes as well as or instead of the public's other charitable donations.

Cahill argues that Comic Relief acts as an entry point for many people into supporting or working with charitable causes and fundraising. "We do one big thing a year, so we hope that the people who work with us or support us will support other charities and become committed charity supporters at other times of the year," he says. "One of the things that has characterised Comic Relief over the years is that young people have got involved. If One Direction do your single, there are going to be lots of eight to 13-year-old girls who are suddenly interested in what we do. When One Direction visited Ghana, the amount of tweeting going on from that demographic was incredible – it would be the first time many of them had typed the words Ghana or Africa or Education 4 All."

Framed photos of celebrities loom large in Cahill's office, but "we can't just turn on a tap and suddenly celebrities come pouring out", he says. "They have only a small amount of time they can give. But in our experience they often do something big, like Comic Relief, and then a few smaller things, for a single cause or in the local community."

Cahill believes the wider sector is enriched by Comic Relief's existence. In 2012, it tried to prove as much by commissioning a survey of the public and wider stakeholders, finding that 77 per cent of respondents agreed that Comic Relief brought "additionality" to the sector and that "Comic Relief expands the UK charity pot".

This was the original intent of its founders. Blackadder writer Richard Curtis and rights campaigner Jane Tewson were "really interested in helping smaller charities", says Cahill. "Charities that didn't necessarily have the capacity to do big fundraising themselves but whose work was important. Jane's equation was 'we'll attract the celebrities and high-profile supporters in order to raise some money; you get on with your crucial work and we will fund you'."

The process by which Comic Relief distributes that funding, says Cahill, is almost mechanical in its efficiency. As money comes in, it is split between international or domestic grants: for Comic Relief this is 60:40; for Sport Relief 50:50. This is then further divided into broad spending themes: better futures, healthier finances, safer lives, stronger communities and a fairer society. Criteria for each are then published and made available to the sector.

A 56-person grants team at Comic Relief then helps to advise those seeking grants. Since September 2013, 950 applications for UK funding and 450 for international projects have been received; a total of 278 grants have been awarded, with 100 still undergoing assessment.

"By the time applications reach us there has been some sort of dialogue," says Cahill. "Then it goes to a group of issues-based experts. If you take our HIV/Aids programme in Africa, we have people who are very knowledgeable about HIV who will do the first cut of the first set of applications. It then goes to the grants committee. It scrutinises and approves the grants, which then go to our trustee board, which has the ultimate sign-off. That process is very thorough, very thoughtful and with years of experience built into it."

That experience has taught the organisation to move towards supporting sustainable long-term change and away from short-term relief. "You can't allocate nearly £900m of grants without having developed an attitude to the world and the understanding that some things work and some things don't," says Cahill. "We've got better at saying: 'From what we know about things we've done in the past, what's the likelihood of this?', 'Would you consider this?' or 'We would be more interested in this dimension.'

"We also look at some things that make a small but vital difference – through the community foundations we gave a thousand grants of £1,000 pounds last year. It could be an older people's group booking a village hall every Saturday, or an Asian women's group booking a slot in the swimming baths. At the other end of the scale, we fund Time For Change, which helps to tackle the social stigma around mental health. It's a different challenge from booking a village hall – it takes more money and the measurements of change are longer, so we give longer-term grants in order to ensure continuity of support."

More partnership working

Working with partners has also become more important, says Cahill. Its partnership with the community foundations, for example, effectively outsources a proportion of grant-giving to third parties. "They are set up right across the country and are very knowledgeable about their own local communities, so it would be impossible for us to replicate that knowledge and understanding," he says.

Cahill describes himself as a generalist. He knows a little about a lot of things, and is affable and wary in equal measure. His initial response to criticisms in the Panorama programme was, he says, "well, Comic Relief is just a great thing; we're trying to make the world a better place". The idea that someone could attack such well-meaning idealism apparently came as an affront. But any organisation that has handled close to £1bn of public money must expect to come under close scrutiny and ought to develop an acute understanding of the purpose and power of investment.

The charity simply acted naively, insists Cahill. In any case, it has emerged from the affair pretty much unscathed. Fundraising and fanfare continue unabated; monetary records tumble year after year. Yet it would surely be vulnerable should another scandal arise soon. Putting the fun into fundraising has become harder in an age more cynical than the 1980s. Perhaps that's why student pranks and baths of baked beans have been replaced by ever more punishing physical challenges.

"When David Walliams swam the English Channel, it began with me asking him whether he'd ever like to do anything sporty, and him saying he's rubbish at sport but he did like swimming," reminisces Cahill. "He thought that maybe one day he'd like to swim the channel. Well, I said, you've just told the wrong person."

Gaining the ears and bending the arms of celebrities like this is part of what Comic Relief does, he says.

"We hope that the sector would be broadly supportive of that because we are able to raise a lot of money for it."

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