RESEARCH ON THE POSSIBILITIES OF IMPLEMENTING THE SMALL CHANGES MONEY COLLECTION PROGRAMME OF HOGAR DE CRISTO INTO FINLAND The legal point of view

Mirke Turunen RESEARCH ON THE POSSIBILITIES OF IMPLEMENTING THE SMALL CHANGES MONEY COLLECTION PROGRAMME OF HOGAR DE CRISTO INTO FINLAND The legal point of view Bachelor s Thesis Business Management December 2006

KUVAILULEHTI Opinnäytetyön päivämäärä Tekijä(t) Mirke Turunen Koulutusohjelma ja suuntautuminen Business Management Nimeke Research on the possibilities of implementing the Small Changes money collection programme of Hogar de Cristo into Finland The legal point of view Tiivistelmä Tämän opinnäytetyön tarkoituksena oli tutkia millä edellytyksin Chileläisen Hogar de Cristo järjestön käyttämä Small Changes -niminen rahankeräys voitaisiin toteuttaa Suomessa. Kyseinen rahankeräys metodi yhdistää toiminnallaan suuren Chileläisen hyväntekeväisyysjärjestön sekä yhden suurimmista vähittäistavarakaupan yrityksistä. Opinnäytetyön teoriaosuus esittelee ensin Suomen ja Chilen ja erityisesti näiden kahden valtioiden erot jonka jälkeen työssä esitellään muutama suomalainen hyväntekeväisyys järjestö ja heidän tällä hetkellä käytössä olevat rahankeruumetodit. Teoriaosuus esittelee lukijalle myös Hogar de Cristo järjestön ja D&S organisaation sekä heidän yhteistyönä toimivan Small Changes -varainkeruumallin. Teoriaosuuden viimeinen osuus käsittelee Suomen rahankeruulakia ja sen aiheuttamia esteitä Small Changes - ohjelmalle. Opinnäytetyön empiirinen osuus tutkii onko mahdollista toteuttaa Small Changes - ohjelman tapainen rahankeruu Suomessa laista esiin nousseista esteistä huolimatta. Tutkimus oli kvalitatiivinen ja se toteutettiin haastattelemalla Suomessa rahankeräys lupia myöntävän Etelä-Suomen Lääninhallituksen oikeushallinto-osaston ylijohtajaa, lokakuussa 2006 sähköpostin ja puhelimen välityksellä. Haastattelusta ilmeni että vastaavia rahankeräyksiä ei ole vielä toteutettu Suomessa. Vastaavan mallin toteutus vaatisi muutamia erityistoimenpiteitä, mutta lupa olisi kuitenkin keräykselle mahdollista saada. Opinnäytetyön loppuosa esittelee toimeenpanosuunnitelman Small Changes -mallin toteuttamisesta Suomen Punaiselle Ristille ja Osuus-kauppa Suur Savolle, joista kumpikin voisi hyötyä mallin toteuttamisesta. Asiasanat (avainsanat) rahankeruu, hyväntekeväisyys, yhteisövastuu Sivumäärä Kieli URN 48+liitteet 18 Englanti URN:NBN:fi:mamkopinn200681472 Huomautus (huomautukset liitteistä) Ohjaavan opettajan nimi Opinnäytetyön toimeksiantaja Eila Jussila

DESCRIPTION Date of the bachelor's thesis Author(s) Mirke Turunen Degree programme and option Business Management Name of the bachelor's thesis Research on the possibilities of implementing the Small Changes money collection programme of Hogar de Cristo into Finland The legal point of view Abstract Today s world is full of people who live in inadequate conditions. There are also plenty of organisations which fund their operations through money collection and try to do their best to help these people. Businesses have also become more aware of and concerned about their operating environment and corporate social responsibility has increased among corporations in the recent years. This bachelor s thesis familiarises the reader with Small Changes money collection method which is used by Hogar de Cristo Foundation in Chile and it ties together a supermarket chain and a charity in the form of a joint money collection method. The main objective of this thesis was to investigate if it would be legally possible to introduce a similar money collection method into Finland. The theory part of the thesis starts by introducing Finland and Chile emphasising some of the differences between these two nations. Some Finnish charities and money collection methods currently in use in Finland is covered in the second part of the theory. The third part of the theory introduces Hogar de Cristo foundation, D&S corporation, and the Small Changes Programme they run jointly. The final part of the theoretical framework consists of the money collection law in Finland and obstacles that it raises. The empirical part of the thesis was to investigate if the legislative obstacles could be avoided. The research method used was qualitative. The Senior Inspector of the Judicial Administration Department of State Provincial Office of Southern Finland which is the authority who grants money collection permits in Finland was interviewed in October 2006 by email and telephone. The interview revealed that similar money collection was not in use in Finland and that it would be possible to implement into Finland. The legislation causes few obstacles which can be overcome. In the end of this thesis an implementation plan for the Finnish Red Cross and Suur-Savo Cooperative is introduced. Both of these organisations would benefit if this money collection method would become part of their operations. Subject headings, (keywords) money collection, charity, corporate social responsibility Pages Language URN 48+ appendices 18 English URN:NBN:fi:mamkopinn200681472 Remarks, notes on appendices Tutor Bachelor s thesis assigned by Eila Jussila

CONTENTS 1 INTRODUCTION... 1 2 LIVING CONDITIONS, WELFARE AND CULTURE IN FINLAND AND IN CHILE... 4 2.1 Facts about living conditions and welfare in Finland... 4 2.2 Facts about living conditions and welfare in Chile... 5 2.3 The cultural dimensions theory by Geert Hofstede... 7 2.3.1 Individualism and collectivism... 7 2.3.2 Power distance... 8 2.3.3 Uncertainty avoidance... 9 2.3.4 Masculinity and femininity... 10 2.4 Comparison of Finland and Chile... 11 3 FUNDRAISING METHODS IN FINLAND... 12 3.1 The Red Cross as a fundraiser in Finland... 12 3.2 Unicef as a fundraiser in Finland... 13 3.3 Kesko as a fundraiser in Finland... 15 4 HOGAR DE CRISTO AND D&S COMBINED BY SMALL CHANGES... 16 4.1 Operations and structure of Hogar de Cristo... 17 4.2 Financing the operations of Hogar de Cristo... 20 4.2.1 Self-financing methods and incomes... 20 4.2.2 Income from donations... 22 4.3 D&S s Operations and structure... 23 4.4 Small Changes programme... 24 5 FUNDRAISING LEGISLATION AND TAXATION IN FINLAND... 28 5.1 Law of money collection in Finland... 28 5.2 Permission for money collection... 29 5.3 The execution of money collection... 30 5.4 Taxation of companies involved with fundraising... 32 5.5 Discussion about the legislation... 33 6 IMPLEMENTING SMALL CHANGES PROGRAMME IN TO FINLAND... 34 6.1 Research methods... 34

6.2 Results of the research... 36 6.3 Implementing Small Changes from Chile to Savo... 38 7 CONCLUSION... 40 INDEX OF REFERENCES... 43

1 INTRODUCTION 1 Since the very early times people have in one form or another helped each other through difficult times. Especially in Finland it seems that the nation has somehow pulled together when there is a big emergency for example a war. Our nation has not been in wars for a few decades now and maybe somehow we have forgotten to take care of each other but every now and then the willingness to help others rises among our nation. There are two quite recent incidents that I recall: the sunk of the Estonia cruise ship in 1994 and the Tsunami in Asia in 2004. In both of these incidents many Finnish people were lost the rest of the nation felt the need to get involved to help those who had survived and the relatives of them who had lost a loved one. Most of us took part in several money collections organised by different types of charities and the results were good. Surprisingly large amounts of money were received. As a nation which has been economically stable for a long time and has never suffered from corrupted rulers we certainly should have more to offer for those who need it. Then again we do donate our funds to charities when the collections are visible enough. Does the problem lie with the way the collections are held? The idea for my bachelors thesis came to my attention in 2003 when I was travelling around South-America and came across this form of fundraising in a Chilean grocery store. The basic idea is very simple; grocery store cashiers collect funds for a charity from the spare change of their customers. I was surprised to see this form of fundraising in Chile and I immediately became curios, and started to wonder why we did not have this form of fundraising in Finland. Chile is considered a less developed country when it is compared to Finland, but yet they had a great way of collecting funds for the poor and needy. Is this just because they are more innovative? Is it the Catholic religion that makes them love their neighbour more than we do? Is the legislation in Finland against such a fundraising method? Why we do not have this in Finland? Later on that year I started my bachelors studies and ever since I have wanted to do my final theses dealing with this matter somehow. Throughout the years of my studies, my interest to investigate this matter has grown stronger. Ecological catastrophes, such as the Tsunami 2004 in Asia, Hurricane Katrina 2005 and the ongoing crisis in Darfur, made me want to investigate more this

2 matter. After for example the Tsunami people were very willing to donate their funds for those whom had suffered from these incidents and I started to think if there could be a new way to collect funds from the public for a charity in crisis situations and even on a regular basis. There is also a trend for companies and enterprises to become more interested in corporate social responsibility and I thought that through a new way of fundraising, organisations could proof their interest to the community. There are currently several different types of fundraising methods in use in Finland, but I want to examine if it would be possible to launch a new one here, one that has been successful in Chile and enables businesses to get more involved. The primary purpose of this bachelor s thesis was to examine from the legal point of view whether it would be possible to introduce a new fundraising method based on the Chilean Small Changes programme which is used by a organisation called Hogar de Cristo and a retail store chain D&S into Finland. This is done by introducing the Small Changes programme and investigating the Finnish legislation on money collection. The secondary objective in this thesis was to familiarise the reader with some of the charities currently operating in Finland and their existing money collection methods. The first part of the thesis introduces briefly the two nations which have a significant role in this thesis; Finland and Chile. I will present some facts in figures of both nations and the final part of this chapter focuses on cultural differences between Finland and Chile. The purpose of this chapter is to give the reader some idea and background information on these nations and perhaps explain why there are differences between these nations when it comes to fundraising. The second part of the thesis focuses on some of the current fundraising methods which are used in Finland. The operations of large scale charities such as Finnish Red Cross and Unicef are explained. I will also cover trade organisation Kesko s methods for fundraising currently in use. After reading the second chapter the reader will have a better understanding of the current methods used and results gained from them. The third part of the thesis focuses on introducing the two Chilean operators charity organisation Hogar de Cristo Foundation and D&R retail store chain that are behind the Small Changes programme. I will also introduce the concept of the Small Changes

programme thoroughly including the amounts of money collected through this method. This is done so that the reader will have a better understanding and knowledge about the Small Changes programme which is the base for the whole thesis. 3 The fourth part of the thesis focuses on the money collection law in Finland and the taxation system involved in fundraising and corporations. The thesis will explain the basics of the legislation, including matters such as money collection permits and execution of the collection. In this chapter some legal problems which this programme could face are pointed out and discussed. The sixth chapter of the thesis reveals the research methods used when data was collected for this research. The Small Changes programme is not a traditional method used in fundraising; therefore it is crucial to investigate if the Finnish legislation would approve this form of fundraising and what type of taxation it would have before going any further. What type of obstacles could it face in terms of legislation and taxation and could they be overcome? In the chapter six I present the results from the interviews with people from State Provincial Offices legal division. After the legality of this method and issues involving around it are solved, it is possible to consider introducing and using this method of fundraising in Finland. The last part of the sixth chapter introduces a model for a fundraising programme in Finland on the basis of my research and findings. My initial idea was to make this plan for Suur-Savo trade chain, which is a part of the S-Ryhmä Group in Finland and the biggest competitor for Kesko Group. I have worked for Suur-Savo myself and my travels to Chile were funded by my salaries from the company. Suur-Savo also has great interests towards corporate social responsibility. My idea is to give Suur-Savo a new method for fundraising that it could implement in its supermarkets. The new method would allow Suur-Savo to donate funds for the public good through a selected charity. This would add value to the operations of the organisation and help it to compete against Kesko Group with some new ideas which could also receive some public interest and make Suur-Savo a leader rather than a follower when the corporate social responsibility among trade corporations is considered.

2 LIVING CONDITIONS, WELFARE AND CULTURE IN FINLAND AND IN CHILE 4 Finland and Chile are different nations in several ways. In this chapter I will try to examine the basic factors of each country in context to my research. It is essential to do comparison into some extent in order to explain some of the differences between these two nations when it comes to fundraising. First I will concentrate on the statistical data of Finland and Chile information of this part is collected from the CIA Factbook and from the national statistic centres of each nation. The third part of this chapter concentrates on the cultural characteristics and differences between the two nations by using dimensions created by a Dutch researcher Geert Hofstede. In the fourth part of this chapter I will summarise the information presented in this chapter by comparing the two nations on each other. 2.1 Facts about living conditions and welfare in Finland Finland is located in Northern Europe and it borders the Baltic Sea, Gulf of Botnia, Gulf of Finland, Sweden, Norway and Russia. The area of Finland in total is 338 145 km 2. The population of Finland in July 2006 was estimated to be 5 231 372 people and life expectancy for males and females was 78,5 years. The main religion in Finland is Lutheran by 84,2%. The literacy rate in Finland among the people over 15 years is 100%. Finland is a republic and it has been independent since 1917, when it declared independence from Russia. Finland has enjoyed democracy for a long time; it has also been ranked as the world s least corrupt country several times. (CIA World Factbook Finland, 2-4, [referred 5.10.2006]) The economy of Finland has been fairly stable for a decade. The country is highly industrialised and largely a free market economy. The key economic sector of Finland is manufacturing for example wood, metals, engineering, telecommunications and electronic industries. Exports are two fifths of the GDP of the nation, thus it can be said that trade is important. Finland depends highly on imports such as raw materials, energy and components for manufactured goods. The Nordic climate restricts the agriculture of Finland to maintaining self-sufficiency in basic products. Finland has been

5 part of the European Union since 1995 and European Money Union since 1998. In general Finland in considered a wealthy and economically stable nation. Table 1 presents important numbers of Finland and Chile. (CIA World Factbook Finland, 6, [referred 5.10.2006]) 2.2 Facts about living conditions and welfare in Chile Chile is located in Latin-America; it has borders with Argentina, Peru and Bolivia. Chile also has the longest coastline to the South Pacific Ocean. The total area of Chile is 756 950 km 2 and the population was estimated to be 16 134 219 in July 2006. Life expectation for the total population was 76,77 years. Most of the Chilean people (89%) are Roman Catholic. The other main religion in the nation is Protestants by 11%. The literacy rate in Chile is 96,2%. Chile is also a republic and it declared its independency from Spain in 1810. (CIA World Fact Book Chile, 2-4, [referred 5.10.2006]) Chile was run by Augusto Pinochet the leader of a dictatorial military regime, until 1990 when the first freely elected president was chosen. During the 1980s the military regime had introduced solid economic policies which laid the foundation for the country s economic growth and commitment for democracy. Corruption is still quite common in Chile and it probably runs back to the times of Pinochet, but it is currently one of less corrupted nations in Latin-America. (CIA World Factbook Chile, 2, [referred 5.10.2006]) The real GDP of Chile grew during 1991-97 by average 8%. In 1998, due to the countries tight monetary policy and global financial crisis which resulted in lower export earnings in Chile, the growth of the nation in real GDP fell into half. In 1999 the nation struggled with extreme drought which resulted in reduced crop yields that caused hydroelectric shortfalls and rationing of electricity. Chile was experiencing negative economic growth and was in severe recession. By the help of its exports, global growth and the strengthening of Argentinean Peso Chile managed to start recovering from the recession. The country signed a free trade agreement with the US in 2004 and with China in 2005. It also has trade deals with the European Union, South Korea and Mexico. One of the most important exports for Chile is copper. Other sources of ex-

ports include forestry, fishing and mining which also bring foreign direct investment to Chile. There is more information about Chile in the table 1 below. (CIA World Factbook Chile, 6-7, [referred 5.10.2006]) 6 Table 1. Comparison of Finland and Chile Finland Chile Unit GDP(purchasing power parity 2005 est.) 161,5 187,1 billion USD GDP Real Growth Rate 2,2 6 % GDP Per Capita (2005 est) 30 900 11 300 USD Labour Force 2,61 6,3 million Unenployment Rate 8,4 8,1 % Exports 67,88 38,03 billion USD Imports 56,45 30,09 billion USD Inflation rate (2005 est) 0,9 3,1 % Population below poverty line 18,2 % Gini Index (2000) 26,9 57,1 *) Minimum Salary 1194 252 USD (CIA The World Factbook Finland [referred 5.10.2006], CIA The World Factbook Chile [referred 5.10.2006], Instituto Nacional de Estadisticas [referred 5.10.2006], Wikipedia [referred 5.10.2006]) *) Gini Index measures the degree of inequality in the distribution of family income in a country. If the income were distributed with perfect equality the index would be zero. The more equal the distribution of income the smaller the index and vice versa. (CIA World Factbook [referred 5.10.2006]) Even though it is not stated in the table 1, it is generally considered that there are people in Finland too who live below the poverty line. In Finland, poverty is relative and it is completely different from that in Chile. The poverty line of Finland is calculated from the income level of people and the people living below the poverty line are those whose income is less than 60% of the nation s median income. When calculated this way, the population below poverty line in Finland was 11% in 2004. As it can be seen from the minimum salary comparison compared to Chile Finland in reality does not have poverty. (Tilastokeskus [referred 5.10.2006])

2.3 The cultural dimensions theory by Geert Hofstede 7 Geert Hofstede, a former Dutch engineer who later became a psychologist, created in 1980 one of the best known and used cross-cultural studies which enables people to understand the differences between different cultures (Woods, 1995, 60). Hofstede was able to study the employees of a multinational company IBM in over fifty different countries in a survey which dealt with cultural differences (Hofstede, 1993, 32). According to Hofstede, a working definition of culture is a collective mental programme which makes people from certain countries to believe certain things, think in certain ways, and to behave in ways dependable on these thoughts and beliefs (Woods, 1995, 60). Hofstede s survey raised four different dimensions in terms of which the national cultures may be compared to. He created an indexing system for the dimensions, calculated each country an index according to their results from the survey, and put them on a scale in a descending order. This helps to compare different nations and their cultural dimensions with each other. The results of the research are relative, they are not meant to be considered absolute as they mainly measure the differences betweem the nations. (Hofstede, 1993, 44-46) 2.3.1 Individualism and collectivism One of the dimensions created by Hofstede is individualism and collectivism. Basically, by individualism Hofstede means the societies where the relationships and connections between different individuals are loose, everyone is expected to take care of themselves and their closest family members. The opposite of individualism is collectivism which is dominant in societies where people are born into strong and tight groups which will protect them throughout their lives in exchange of faithfulness. (Hofstede, 1993, 78-79) According to Hofstede s individualism index figures, Finland is ranked 17 th with the score of 63 and Chile is 38 th with the score of 23 (Hofstede, 1993, 81). This indicates that Finland is more an individualist country than a collective and Chile on the other hand is a collective country. From the table below, you can see the main differences between an individual and collective culture according to Geert Hofstede (1993, 100,

109). The table also demonstrates the differences between the Finnish and Chilean cultures. 8 Table 2. Characteristics of individual and collective cultures Individualism Collectivism Every member of the society is raised People are born to large families and to take care of them selves and their other close groups which will always nuclear family protect them and demand loyalty in exchange Individual is the basis for identity Identity is based on social network which the individual belongs to Children learn to think in "I" form Children learn to think in "we" form The meaning of education is to lear to The meaning of education is to learn learn to do The task goes over relationships The relationships go over the tasks Everyone is expected to have their The group decides the opinions of the own opinions individual The laws and rights are equal to all The laws and rights change according to the group The economy is based on individual The economy is based on collective priviledges priviledges Individual's benefits forsees the Collective benefits forsees the collective benefits individual's benefits (Hoffstede, 1993, 100, 109) 2.3.2 Power distance The second dimension used by Hofstede is the degree of tolerance for differences in power between different nations, power distance. It represents inequality in the nation and how well the less powerful members of the organisation, institution or even a family accept and in some degree expect that power is distributed unequally. Hofstede states that power is not only in the hands of those who are leaders, but that those with less power can be dependent on their leaders and accept the fact that they are subordinates. Thus the emotional distance between subordinates and their leaders can be large. In high power distance cultures, it is less likely for subordinates to directly approach their leaders or to question them. (Hofstede, 1993, 48)

9 According to the power distance index, Chile is ranked on 24/25 th place with Portugal and their index is 63. Finland is ranked at the 46 th place with the index of 33. Therefore Finland is a country with a small power distance whereas Chile is a nation with a big power distance. The following table presents some of the characteristics and differences between the nations which have a small power distance and big power distance. (Hofstede, 1993, 46) Table 3. Characteristics of a small and big power distance Small power distance index The unequality of people should be minimized People with no power and people who have power should have a relationship which to some extent is mutually dependent Parents treat children as their equals Children treat their parents as their equal Large middle class Everyone has equal rights Differences between income distribution are small (Hofstede, 1993, 61, 68) Big power distance index Unequality is expected and accepted People without power should be dependent on the people who use power Parents teach children abeyance Children treat their parents with respect Small middle class Those with power have privileges Differences between income distribution are large 2.3.3 Uncertainty avoidance Uncertainty avoidance is another cultural dimension. It focuses on the society s tolerance for uncertainty and it can particularly drive from the future which for all of us is uncertain. Certain cultures have higher tolerance for uncertainty and unstructured or controlled situations. People from certain cultures feel anxiety when the situation is uncertain and out of their control. (Hofstede, 1993, 160) Chile is ranked 10/15 th in the uncertainty avoidance list with an index of 86. Finland is in position 31/32 with an index of 59. In Finland, uncertainty avoidance is lower than in Chile. From the following table you can see what differences this may cause in the behaviour of people. (Hofstede, 1993, 164)

Table 4. Characteristics of weak and strong uncertainty avoidance 10 Weak uncertainty avoidance Strong uncertainty avoidance Uncertainty is a normal part of life The uncertainty of life is a constant and every day has to be taken as it threat and it has to be fought Only the necessary rules exist Emotional need for rules, even if they would not work Citizens have a positive attitude Citizens have a negative attitude towards institutions towards institutions The truth of an individual group There is only one truth which we should not be forced on others have Different things are fascinating Different is dangerous (Hofstede, 1993, 183, 196) 2.3.4 Masculinity and femininity The fourth dimension which can be found from the Hofstede s study is masculinity and femininity. According to Hofstede, masculine countries are those countries which have hard values such as achievement, making money, success, showing off and which maximise sex-role differences. Feminine countries are countries where dominant values are softer. They have the values which normally are associated with women and these include putting relationships first, care for the small and weak, concern with the quality of life, protection of the environment and the small is beautiful view. (Woods 1995, 62) In the masculinity index ranking list, Finland and Chile are on places 47 and 46. Chile has index of 28 and Finland 26. It can be said that both nations are feminine (Hofstede 1993, 1993). Some of the specific characteristics of the feminine culture are that the ideal society is a welfare society, which supports the weak and is more allowing than punishing. People and warm relationships are important in these cultures, and people are expected to be modest. Boys and girls study the same subjects at school, and equality, solidarity, and the quality of work life are emphasized. (Hofstede 1993, 142, 152)

2.4 Comparison of Finland and Chile 11 As a conclusion for this chapter, it is important to note that there are many differences between Chile and Finland. The differences can be cultural, economical or demographical, but they all will have an impact on the behaviour of people in these two nations. Thus these differences should be acknowledged while reading this thesis, even though the subject of the thesis focuses more on the legislation than behaviour. The very basic differences can be derived from the locations of these two nations: Finland is a Nordic country and Chile Latin-American. Behaviours, norms and morals between people from the Latin cultures and the Nordic cultures differ a lot. For example, Latinos are louder and have a strong temper; Nordic people can be seen as reserved and quiet. In Chile wealth is distributed very unevenly; the rich are extremely rich, the poor truly are poor, and the middle class is relatively small. A social welfare system does not really exist in Chile, not at least at the same way as it does in Finland. As stated in chapter 2.2, poverty in reality does not exist in Finland. Our taxation system is very effective in a way that it provides social security to all people in Finland. Education is free for all hence the high literacy rate. Most of the people in Finland can be considered to belong into the middle class; the distribution of wealth in Finland is quite equal. The power distance in Finland is low, in Chile it is higher. Also corruption in Finland is low whereas in Chile it is higher. Perhaps wealth distribution, power distance and corruption are related somehow to each other. Family is considered a larger unit in Chile and the ties within it are tight. In Finland family is normally the core family, extending only to perhaps to grandparents. Individualism is very important in Finland and we are raised into it from the time we are children. In Chile youth is more dependent on their families. Chile is a collective nation, Finland individualistic, but yet both nations seem to be more feminine than masculine. Religion is also a divider between these two nations. Finland is a Lutheran nation and we do not practise our religion a lot. Most of us are members of the church but for only few of us it gives the directions in life. In Chile the main religion is Catholic, a

12 religion that in most countries is strongly practiced and where most of the rules of life come from. For people in Chile religion means more than it does to Finnish people. Perhaps due to the lack of social welfare, collectivism and Catholic education people in Chile like to help those who need it even though their own income would not be sufficient. Are we in Finland too used to the government taking care of everyone with tax revenues? Or do both the Chilean and the Finnish people behave the same way when it comes to fundraising? Do the Finnish people donate more than the Chilean or vice versa? There are several similar questions that would need an answer and that could be the subject of a completely different thesis. 3 FUNDRAISING METHODS IN FINLAND The purpose of this chapter is to familiarise the reader with some of the fundraising methods used in Finland today by different charities and organisations. This is done by introducing some of the largest and best known charities in Finland, and around the world. The thesis explains the methods for fundraising in Finland for Finnish Red Cross and Unicef. Finally this chapter introduces information about a retail store chain Kesko and its fundraising methods. Kesko has recently introduced a new method of fundraising among its customers. 3.1 The Red Cross as a fundraiser in Finland Finnish Red Cross is one of the best known charity organisations operating in Finland. The organisation is recognised by the government of Finland and there is a separate legislation for the operations of Red Cross in Finland. (Suomen Punainen Risti (a) [referred 18.9.2006]) Finnish Red Cross has various different methods for fundraising. The organisation mainly uses different campaigns and money collections for the collection of funds. The biggest money collection organised in Finland so far has been the Tsunami collection the Red Cross organised. In total the Red Cross managed to collect 26,5 million euros between 2004 and 2005. Another large scale collection in 2005 was the Pakistani earth quake collection, which raised 940 000 euros. These collections were exe-

cuted by having collection boxes in shops and volunteer collectors on the streets. (Suomen Punaisen Ristin Toimintakertomus 2005, 21 [referred 18.9.2006]) 13 Another money collection which is popular and well known in the Finnish society is the Famine Day collection (in Finnish Nälkäpäivä keräys ). The Famine Day collection has been organised for the last 26 years every September nationwide. The target group of the collection changes according to the needs of different nations. During three days people can see the volunteer workers of Red Cross on the streets with their collection boxes and donate money to the organisation. Collections are also organised in schools. In 2005 this particular collection raised 2,6 million euros for the organisation. (Suomen Punaisen Ristin Toimintakertomus, 2005, 21-22 [referred 18.9.2006]) A good Christmas Spirit collection (Hyvä joulumieli) was organised for the ninth time in 2005. This is a collection for the help of the poor families in Finland and it raised 452 000 euros in 2005. The Finnish Red Cross also uses memberships as a source of funding. In 2005 the organisation started a direct debit membership programme where the minimum amount of 15 is debited from the donators account every month. This form of fundraising has just begun in the Finnish Red Cross; thus there were no figures available yet from its benefits. (Suomen Punaisen Ristin Toimintakertomus, 2005, 21-22 [referred 18.9.2006]) People can also donate money through the internet on Red Cross webpage or by telephone. Companies can donate money for the organisation there is also a special membership day programme, where people can ask for example that their birthday presents are given as a form of donation for the Red Cross. Donations from last wills and used clothing are also accepted. If the donator so chooses they can also donate their money for the work of Red Cross in Finland. You can see the total amount of donations which Finnish Red Cross collected in 2004 from table 5 below.(suomen Punainen Risti (b) [referred 18.09.2006]) 3.2 Unicef as a fundraiser in Finland Unicef is another worldwide charity organisation which operates in Finland. It operates for the good of children and youth around the world. In 2005 Unicef s largest col-

14 lections were the Tsunami and Pakistani earth quake collections which generated over 3 million euros for the organisation. These collections were executed by collecting money from people by bank drafts or phone call donations. (Unicefin Vuosikertomus 2005, 3 [referred 18.9.2006]) Another popular collection that Unicef organises is the Thirst Day collection ( Janopäivä keräys in Finnish) which was organised for the eighth time in Finland in 2005. The local affiliates of Unicef organised the collection together with parishes, scouts and schools. Together they managed to collect around 400 000 euros. The money from this collection was used for the improvement of water and sanitation conditions in Eritrea. (Unicefin Vuosikertomus 2005, 7[referred 18.9.2006]) Unicef also sells products which generate money for the organisation. These include Christmas cards and other products with the organisation s logo on them. The sales are executed by direct sales for either companies or individuals and it generated 1,6 million euros for the organisation. (Unicefin Vuosikertomus 2005, 3,16 [referred 18.9.2006]) Yet another large source of income for Unicef is the monthly donators that the organisation has. In 2005 these private donators donated 5,4 million euros for Unicef. Unicef has over 25 000 donators, who with a direct debit donate money for the organisation every month. (Unicefin Vuosikertomus 2005, 3 & 16 [referred 18.9.2006]) You can also donate funds for Unicef from the internet, or by requesting people to remember your birthday by donating to the Unicef s accounts. Unicef also has a donation programme for organisations and they accept wills of testament for funding as Red Cross does. The organisation also arranges raffles for different causes. The total amount of donations collected by Unicef in 2004 can be seen from table 5 below. (Unicef (a) [referred 18.09.2006]) For both Unicef and Red Cross, the participation of big enterprises in Finland and their donations are essential. For example retailers such as Kesko and S-Ryhmä are both in co-operation with these charities. Yle, the Finnish tv and radion broadcasting company, has also included both of these charities into its Ylen Hyvä fundraising

programme. (Unicef (b) [referred 18.9.2006], Suomen Punainen Risti (c) [referred 18.9.2006]) 15 Table 5. The largest money collections by gross revenue in Finland 2004 The organisation Collection Collection Gross Net started ended Revenue Revenue The Finnish Cultural Foundation 1.10.2003 30.9.2004 17 077 704 17 077 704 The Finnish Red Cross 1.1.2004 31.12.2004 11 539 288 10 746 283 Plan Finland Foundation 1.7.2003 30.6.2004 6 386 483 5 678 029 Unicef of Finland 1.1.2004 31.12.2004 6 113 891 5 254 609 Patmos Missionery Foundation 1.1.2004 31.12.2004 3 970 312 3 654 424 Church Services 1.9.2003 31.8.2004 3 172 510 2 646 808 Church Foreign Aid Foundation 1.1.2004 31.12.2004 3 002 689 2 759 333 The Finnish Evangelical Lutheran Mission 1.1.2004 31.12.2004 2 779 329 2 578 412 War Invalids Fraternaty 1.1.2004 31.12.2004 2 700 241 2 323 082 Medi-heli 27.11.2003 26.11.2004 2 167 084 1 515 152 Save the Children 1.1.2004 31.12.2004 1 915 486 1 478 292 The Finnish Salvation Army Foundation 17.2.2003 31.12.2004 1 318 383 1 271 562 (Vuorela, Kirsti 2006) 3.3 Kesko as a fundraiser in Finland Kesko is a trading company which operates in Finland, Sweden, Norway, the Baltic Countries and Russia. The company was originally established in 1941 and it has steadily produced profits ever since. Today it has around 2200 stores, engaged in chain operations. The net sales of Kesko in Finland were 6,657 million euros in 2005 and the company employed 14 600 employees. Kesko group includes shops as K-Market, City Market, Anttila, K-Rauta, Musta Pörssi, Asko, K-Kenkä, Kesko Agro and Intersport. Its operations vary; the company sells basically everything between food and agricultural equipment. (Kesko s Year 2005, 1-3 [referred 20.9.2006]) The Kesko group donates funds in different forms for the use of public good. In 2005 the total amount donated was 2,2 million euros. The Kesko Group sponsors carefully selected organisations and the objects of sponsorships have to support the values of the organisation and strategies in general. The different affiliates of Kesko Group have