339 Queen Street East
Toronto, ON M5A 1S9
Executive Director: Dalal Al-Waheidi
Board Chair: Greg Rogers

Charitable Reg. #:88657 8095 RR0001

STAR RATING

Ci's Star Rating is calculated based on the following independent metrics:

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FINANCIAL TRANSPARENCY

Audited financial statements available only through official request for information from Charities Directorate.

B

RESULTS REPORTING

Grade based on the charity's public reporting of the work it does and the results it achieves.

Low

DEMONSTRATED IMPACT

The demonstrated impact per dollar Ci calculates from available program information.

NEED FOR FUNDING

Charity's cash and investments (funding reserves) relative to how much it spends on programs in most recent year.

93%

CENTS TO THE CAUSE

For a dollar donated, after overhead costs of fundraising and admin/management (excluding surplus) 93 cents are available for programs.



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OVERVIEW

About WE Charity:

WE Charity (formerly Free the Children) was founded in 1995 by Canadian teenagers, Craig and Marc Kielburger. Originally, WE Charity's focus was on international development. Today its North American and UK operations are its largest programs. WE Charity is a global children’s charity. Its mission is to empower students by giving them, and their teachers, the tools to create transformative social change.

Recent news: WE Charity states that it has been irreparably harmed by the fallout of what is called the WE Charity scandal.  On June 25, 2020, as part of the covid-19 pandemic response, the Canadian government awarded a $912m contract to WE Charity to recruit, manage, and fund student volunteers. On July 3, WE Charity withdrew from this contract. In the aftermath, new information came out about WE Charity. In September 2020, co-founders Craig and Marc Kielburger announced that WE Charity's Canadian operations will close down. Proceeds from selling its Toronto buildings will fund an endowment to support WE Charity's programs in Kenya, Ecuador, and China. At this time, this closure only applies to WE Charity's Canadian operations and does not affect WE Charity US, WE Charity UK, ME to WE social enterprise, or other WE entities. 

DONOR ADVISORY: Charity Intelligence issued a donor advisory on July 17, 2020 reflecting WE Charity Canada’s turnover in directors and new information about governance. WE Charity Canada had four new directors appointed in 2020. Three of these directors stepped down in March 2021. Greg Rogers remains as board chair.

WE Charity’s two main programs in F2020 are Canadian youth programs and international development projects. 

In F2020, WE Charity spent $28.1m on Canadian programs, excluding donated goods. This is 54% of WE Charity’s total program spending. Canadian programs include WE Days, WE School resources, WE Teachers, and WE Well-being, a mental health initiative. WE Days are youth rallies that celebrate social good. The 2019-2020 WE Days were held in 11 cities, including Toronto, Halifax, Edmonton, Winnipeg, Vancouver, and Ottawa in Canada, and New York City and London, UK. WE Days are funded by corporate sponsors and feature speakers, athletes, and celebrity performers. WE Days cost around $1 million to host, not including volunteers and donated support. WE Days are free to attend, with youth “earning tickets” by helping with local initiatives. Due to the covid-19 pandemic, WE Days for Baltimore, Chicago, and California were cancelled.

WE Charity reports that more than 200,000 youth attend WE Days each year. Attendance ranges from 3,000 youth in Winnipeg to 20,000 youth in Toronto and Vancouver. WE Charity reported in 2018 that 4.3 million youth and 37,359 teachers around the world engaged with more than 10,000 WE Schools programs. Former WE Charity staff have raised issue with how WE Charity calculates its reach. WE Charity denies it manipulates or fabricates results data.

In F2020, WE Charity spent $23.9m on international programs, representing 46% of total program spending. Donations go to WE Villages, which are communities supported through WE Charity’s five pillars of Education, Water, Health, Food, and Opportunity. WE Charity states that targeting these five areas helps to address the root causes of poverty and achieve holistic development. WE Charity’s largest international region is Africa (Kenya, Ethiopia, Sierra Leone, and Tanzania) where it spent $16.8m, followed by Latin America (Ecuador, Haiti, and Nicaragua) at $4.7m, and Asia (China and India) at $1.1m. WE Charity’s Ethiopian programs are run through Imagine 1 Day. WE Charity spent $1.9m in F2020 and $860k in F2019 for these programs in Ethiopia, such as building schools and latrines to give children access to education. After the year end, Imagine 1 Day separated from WE Charity and became, again, an independent charity.

WE Charity funds its international programs in two ways: it directly spends $13.1m on supporting WE Villages, and gives $9.4m to local non-profits working in WE Villages. WE Charity supports 86 WE Villages in 9 countries. Since its founding, WE Charity reports it has provided more than 1 million people with clean water and sanitation and helped 200,000 children access education.

ME to WE: There is confusion among donors about the blurred lines between WE Charity and ME to WE. Collectively these two distinct organizations are referred to as “WE”, “WE organization”, or “WE movement”. ME to WE is an affiliated social enterprise. In other words, ME to WE is a private business controlled by Craig and Marc Kielburger, WE Charity's co-founders. While WE Charity was founded in 1995, ME to WE started up in 2004. ME to WE's CEO is Roxanne Joyal, Marc Kielburger's wife. WE Charity's CFO is also ME to WE's CFO.

WE Charity buys promotional goods and travel services from ME to WE.  ME to WE is also a corporate partner of WE Days.

Listen to Charity Intelligence's interview with CBC’s The Current on the relationship between WE Charity and ME to WE on July 13, 2020.

To learn more:

Charity Intelligence's Top 10 questions to ask Marc and Craig Kielburger

Charity Intelligence's statement on WE Charity's Next Steps

 

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Results and Impact

WE Charity has not posted an annual report for 2020 or 2019. These results refer to 2018.

In surveys with Canadian and US teachers in 2018, WE Charity found that 90% of students showed increased leadership among their peers after participating in WE Schools programs. In addition, 83% of teachers felt better equipped to teach about social justice issues.

WE Charity helped 44 high school students graduate from its Kisaruni Group of Schools in Kenya in 2018. During the year, it also reached more than 200 Kenyan women by opening a new Women’s Empowerment Centre. The centre includes a computer lab, banking facility, artisan production space, and daycare.

While Ci highlights these key results, they may not be a complete representation of WE Charity’s results and impact.

Charity Intelligence has given WE Charity a Low impact rating based on demonstrated impact per dollar spent.

Impact Rating: Low

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Finances

Note: WE Charity changed its fiscal year end to August. The 2018 figures are for only 8 months and are not comparable with 2019 figures for 12 months.

WE Charity received $20.1m in Canadian donations and corporate sponsorships in F2020. WE Charity received $27.5m in international donations, including $26.5m from WE US and $1.1m from WE UK in F2020. It also received $6.7m in government funding and $5.2m in donated goods and volunteer time.  

WE Charity’s administrative costs are 3% of revenues (less investment income) and fundraising costs are 3% of Canadian donations. This results in total overhead spending of 7%. For every dollar donated, 93 cents go to the cause. This is within Ci’s reasonable range for overhead spending.

WE Charity’s net funding reserves are shown as negative because its interest-bearing debts exceeded its liquid assets in F2020. At year end in August 2020, WE Charity had cash and investments of $11.4m, compared to $11.5m at year end in August 2019. WE Charity’s bank loans and lease agreements rose to $14.0m in F2020, compared to $13.7m in F2019. Its bank loans are secured against its properties valued at $38.2m. This creates negative funding reserves of ($2.6m).

WE Charity’s F2020 financials report that it will repay all of its bank debts by March 31, 2021. This resolves WE Charity’s lending situation. In F2019 and F2018, WE Charity was in breach of its bank loan covenants. Its bank waived these conditions in both F2019 and F2018.

WE Charity’s audited financial statements disclose related party transactions: WE Charity paid $1.2m to We365 Holdings Inc. for support for Canadian programs. We365 Holdings Inc. is entirely owned by WE Charity. In F2020, WE Charity paid ME to WE, the co-founders’ private business, $292k for promotional goods, while WE Charity received $1.9m in contributions from ME to WE.

There are many WE Charity related foundations. WE Charity’s audited financial statements are not consolidated. They only report on WE Charity Canada’s operations.

Charity Intelligence has sent this update to WE Charity for review. Changes and edits may be forthcoming.

Updated on June 7, 2021 by Eric Zhao.

Financial Review


Financial Ratios

Fiscal year ending August
202020192018
Administrative costs as % of revenues 3.3%6.1%6.9%
Fundraising costs as % of donations 3.4%7.7%6.1%
Total overhead spending 6.8%13.8%13.0%
Program cost coverage (%) (5.1%)(4.6%)9.5%

Summary Financial Statements

All figures in $000s
202020192018
Donations 20,06828,13819,054
International donations 27,53422,08813,647
Goods in kind 5,1948,4758,289
Government funding 6,6771,5801,594
Investment income (68)13529
Other income (68)(84)167
Total revenues 59,33760,21043,279
Program costs - International 23,86926,76119,646
Program costs - Canada 28,12123,72910,654
Grants 04000
Donated goods exp 5,1948,4758,289
Administrative costs 1,9833,6892,935
Fundraising costs 6922,1611,163
Other costs 602627337
Total spending 60,46065,84143,023
Cash flow from operations (1,124)(5,631)256
Capital spending 161(1,630)(372)
Funding reserves (2,643)(2,212)2,885

Note: Charity Intelligence presents figures on a cash basis to show actual amounts received and paid out during the year. This includes adjusting donations by changes in deferred contributions and capital contributions received in previous years but reported in the current year. This adjustment affected revenues by ($5.4m) in F2020, ($5.7m) in F2019, and ($514k) in F2018. In F2019, WE Charity received $150k in endowment contributions, which Ci included in donations. Ci included foreign exchange gains (losses) in other income and included interest income, realized and unrealized gains (losses) on marketable securities, and earnings from investments in We365 in investment income. This affected total revenues by ($156k) in F2020, ($113k) in F2019, and $684k in F2018. Ci included interest on long-term debts in other costs and excluded losses (gains) on the disposal of capital assets from expenses. This affected total expenses by ($927k) in F2020, $1.4m in F2019, and $909k in F2018. According to its financial notes, WE Charity received $4.9m in covid-19 assistance from the Canadian government in F2020, which it treated as a reduction of payroll expenses. Ci classified covid-19 assistance as government funding and added back the amounts of $3.3m to Canadian programs, $1.3m to international programs, and $299k to administrative costs.

Salary Information

Full-time staff: 487

Avg. compensation: $39,182

Top 10 staff salary range:

$350k +
0
$300k - $350k
0
$250k - $300k
0
$200k - $250k
0
$160k - $200k
0
$120k - $160k
1
$80k - $120k
3
$40k - $80k
6
< $40k
0

Information from most recent CRA Charities Directorate filings for F2020

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Comments & Contact

Comments added by the Charity:

WE Charity provided the following comment in September 2021: 

WE Charity official response to this posting and analysis from Charity Intelligence:

Over 25 years, WE Charity made “doing good, doable”. Over 100,000 educators were engaged in classrooms across Canada, the US and UK providing free resources to help students with service learning—integrating global issues, action and volunteerism into core curriculum. Over 1.5 million students earned their free ticket to WE Days celebrating service. In nine countries in Africa, South America and Asia, more than 1 million people gained access to clean water and sanitation, 200,000 students received an education in schools established by WE Charity, and over 30,000 women were provided with the tools and resources to achieve economic self-sufficiency.

Sadly, in the fall of 2020, WE Charity announced its closure as a non-profit in Canada. This was the result of a campaign of sustained attacks by some media and politicians, based almost entirely on misrepresentation and misinformation. Unfortunately, Charity Intelligence was one of the key sources of that misrepresentation and misinformation.

WE Charity had always respected the need for independent oversight of the charitable sector, and therefore had always supported and sought to cooperate with Charity Intelligence to the greatest degree possible. Indeed, prior to 2020, WE Charity had been given consistently high rankings from Charity Intelligence and even saw its grade increased in 2019. Nevertheless, the actions of Charity Intelligence, and particularly the behaviour of its key staff on social media, since 2020 were wholly lacking in respect, responsibility, accountability, professionalism and fairness.

In the wake of the controversy surrounding the Canada Student Service Grant program in the summer of 2020, WE Charity engaged a host of experts in finance, law and governance to conduct a full review of all allegations leveled by Charity Intelligence. These individuals, including forensic auditor Dr. Al Rosen, forensic auditor Ken Froese, and former Solicitor General of Ontario Matt Torigian, are highly respected in their fields. In contrast, none of CI’s are professional accountants —a fact made abundantly clear by the ongoing misrepresentation of aspects of WE Charity financial statements.

At this time, I would like to counter the key misrepresentations and false statements made by Charity Intelligence and its staff since 2020.

At no time prior to the pandemic or the CSSG program was WE Charity in significant financial difficulty. This is a critical point because Charity Intelligence’s false narrative became the foundation for the false allegation that WE Charity lobbied the federal government for the CSSG program in order to allay its financial difficulties. The so-called “breach of covenant” which Charity Intelligence Executive Director Kate Behan repeatedly referenced in the media (and note WE Charity’s financial statements never used the highly prejudicial word “breach”) was an accounting technicality resulting from a shift in WE’s fiscal year that impacted revenue reporting for two consecutive reporting years. Forensic auditor Dr. Al Rosen reviewed WE Charity’s finances and definitively concluded: “WE was financially viable at the time of the signing of the CSSG Funding Agreement with the Federal Government and was not in any financial peril.”

There were no “blurred lines” between WE Charity and ME to WE social enterprise that resulted in a “backwash” of funds from the charity to the social enterprise. Ms. Bahen repeatedly told media: “I think the lines between these organizations are blurred intentionally.” When ME to WE was established, its corporate structure and relationship to WE Charity was reviewed by a host of legal and governance experts including some of Canada’s most respected law firms and former Supreme Court Justice Peter Cory. Since its founding 100% of ME to WE profits have been donated to WE Charity or reinvested to grow its social mission. Over the years, ME to WE Social Enterprise has donated more than $20 million in cash and cost-offsetting in-kind services to the charity. WE Charity has paid for services provided by ME to WE, like the purchase of deeply discounted ME to WE Trips for donors or youth on scholarships. Again, forensic accountant Dr. Al Rosen investigated the relationship and transactions between the two entities and concluded: “Any assertion that the ‘lines are blurred intentionally’ between these ME to WE Social Enterprises and WE Charity have not been supported by evidence… The ‘backwash’ analogy is not explained or reasonably-based on the facts of the source of funds, use of funds and purpose of funds.”

There was never a governance crisis at WE Charity. Ms. Bahen is quoted in media saying: “Did WE Charity inform the government that its board had resigned or was replaced just weeks before, and that there was a gap in governance and oversight at the charity? … Oh and by the way — it has no board.” The WE Charity board did not resign en masse. Through the summer of 2020, an orderly and long-planned transition of Board members took place associated with the org 25th anniversary, with three previous and highly qualified members—a lawyer, a certified accountant, and the former CEO of the Toronto District School Board—staying on to provide continuity and several new and highly qualified individuals joining the board. There was never a point at which WE Charity was operating without Board oversight.

Further false allegations: In media and on social media, the staff of Charity Intelligence made numerous other false statements including repeatedly misstating the value of the CSSG program, implying WE Charity of influenced third party evaluators with gifts and free trips, and wrongly attributing the actions of other groups (such as an east coast charity with a similar name) to WE Charity. The staff of Charity Intelligence also engaged in vicious and unwarranted personal smears against a WE Charity staff member who was suffering a life-threatening health condition.

WE Charity twice wrote open letters correcting the record on these false allegations, which only received a non-substantive, cursory response. You can read those letters: HERE and HERE.

In the opinion of WE Charity, Charity Intelligence leveraged the CSSG controversy for its own self-promotional benefit, boosting its own profile by advancing false information to harm another charity. It should be noted that Charity Intelligence has acted similarly in the past, including the True North Youth Foundation.

It is unfortunate that there appears to be few checks and balances on such misconduct. While Charity Intelligence presents itself as an expert on non-profit governance, its board consisting of just three individuals, two of whom are also paid staff of the organization (including Ms. Behan). Despite that, Charity Intelligence awards itself the highest grades in its own evaluation.

In contrast to Charity Intelligence’s conclusions, WE Charity has received funding from the Skoll Foundation, the Bill and Melinda Gates Foundation, as well as global businesses such as KPMG, Microsoft, and Unilever. All performed due diligence on WE Charity and, based on their findings, chose to partner with and financially support WE Charity.  It should also be noted that Charity Navigator (the largest reviewer of charities in North America) in Fall 2020 provided WE Charity a perfect four-star rating.

 

 

Charity Contact

Website: www.wecharity.org
This email address is being protected from spambots. You need JavaScript enabled to view it.

Tel: 416.925.5894

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Sources:

Jason Miller, "Toronto-based charity WE planning major downtown expansion with enterpreneurship centre" Toronto Star, December 20, 2018 

Sarah Turnball, "Trudeau defends WE Charity contract amid concerns of conflict, lack of accountability", CTV News June 29, 2020

Tel: 416.925.5894

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