To Profit or Not to Profit?

I know, I know - I'm supposed to be writing about what I'm doing. Bear with me awhile longer - this one is about something that got me thinking.

This article in the New York Times has caused a bit of a stir in some corners of the development blogosphere (I stumbled upon it here and followed up with some additional interesting reading here).

The gist of the question floating around is this: should people/organizations/CEOs who do development work be able to make money "helping?" How about a lot of money?

I don't have an answer to either, but they are interesting questions.

In trying to come up with an answer, I've come across the following additional questions and observations.

-Most people don't like it when other people make more money than they do. This stigma needs to be avoided by NGOs (who rely on donations from 'most people' either directly or through taxes) to function. It also needs to be ignored entirely when discussing whether or not it's ethical for NGO CEOs to make big salaries.

-The discussion on whether or not NGOs and the people who work for them tends conflate the question of whether or not aid staff should make a living wage with the question of whether or not they should be allowed or encouraged to make A LOT of money. They're two different questions. The answer to the first one is a resounding YES as far as I'm concerned. People who aren't making a living wage doing development work aren't maximizing their impact: they're learning a lot about the conditions they're trying to change via first-hand experience, but at the expense of being able to focus on and innovate in the work of changing them. I am fortunate enough to work/volunteer with an organization that provides me a stipend that I count as a living wage. While I can't live forever/start an RRSP with the stipend I get for being an EWB Canada volunteer, I can live comfortably in Malawi, and that helps me do (or at least try to do) better development work.

-The question of whether or not development professionals should make A LOT of money is trickier. One school of thought holds that a good way to improve development work is to reward good work and/or to use material incentives to attract talented people (aka pay people more) while another camp firmly holds that development work should be a reward in and of itself and that people who are attracted to such work for the money are simply the wrong sort of people to be doing it. I don't know enough about what "talented people" in development look like to declare whether or not money is the answer to unlocking their true potential, and I'm 100% convinced that, either way, the definition of "good work" needs a pretty serious overhaul before we can say that more money in the form of salaries will encourage it.

-On the "good work" point: an argument in favour of higher salaries is the meritocracy effect. Reward people for good work and the good work being done experiences a net increase. Kristof highlights the point in the example of Dan Pallotta, businessman-turned-pariah. I don't disagree with the logic: it seems to work in sales. I worry though about whether or not the targeted outputs of development work
a) exist in any sort of useful, form; and
b) lend themselves to the creation of salary brackets.
Outside of fundraising, how do you quantify whether an organization or a CEO or an individual field-level staffer is doing "good work"? By number of beneficiaries reached? Number of committees trained? Money spent on projects? Community members who feel they were "helped" by the organization when asked on a survey?

-I get the feeling that this discussion is about expats who are based in developed countries and go do development work in developing countries and largely being conducted by those expats and the people living in the developed countries that they're based out of.Do the terms of the discussion change when we're talking about local NGO staff? Should the Malawian Head of Malawi Fresh Water (this guy's partner organization) be subject to whatever moral consensus we reach? How do we involve such people in the discussion? (I'm going to ask around at my office next time I have the chance - knowing what Malawian development workers collecting pretty decent salaries think about this whole mess would, I think, be rather interesting).

-I have serious reservations about the implications of thinking about aid as an industry. These reservations need some more thinking (they're even more half-formed than my thoughts about NGO salaries), but I raise them because the question of whether or not aid is and should be an industry, with experts, careers, pensions and bottom lines is a thorny one that directly relates to how the sector's employees should think of themselves and be treated. My knee-jerk reaction is to rail against industrializing aid - I am motivated to be here by the (vain, perhaps) hope that I can work myself out of a job, and anything that lends more permanence to development infrastructure than is minimally necessary makes me nervous. On the other hand, 'industry' and the private sector more broadly have pretty good track records in solving some of the problems that hamper the work of development agencies. Areas of best practice like staff retention, professional development, organizational efficiency and output quality control might benefit from a more 'industrial' touch than the one currently being administered by us starry-eyed idealists.

-In case you're a data type, the Canadian government graciously hosts a database detailing the tax documentation filed by registered charities. The salaries of EWB's CEOs are quite modest, by the way.

That's all the food for thought I have for now.