Who Owns The Red Cross?

Posted on | August 10, 2007 | 6 Comments

Same Old and Something New

In a past Health Politics program (The Red Cross: Then and Now) I recounted the history of this revered organization, as well as its trials and tribulations. Among these have been chronic quality management problems with its blood business, chronic governance turmoil, high senior leadership turnover, and criticism of its management of disasters and application of funds raised on the back-end of disasters. Over the past week, there has been more of the same and something new. First, the same: Today a report that the Red Cross is taking heat for problems in distributing a $39 million relief-fund to victims of Katrina. The Red Cross actually raised $2.1 billion on the back of Hurricane Katrina, with $1.9 billion reported distributed immediately in the aftermath of the storm. That left $175 million allocated to a variety of outlays, including the fund in question, new case workers, some mental health services, and two other programs "in development."

As for the $39 million fund, the complaintants say the existence of the fund was not advertised, the original application form for relief was 20 pages long ( it’s now 8 pages), only $12 million has been distributed in the last 12 months with an average payout of $8,700 and a processing time of 46 days. As for the new issue, a little history I was unaware of: The owner of the Red Cross brand insignia is none other than J&J, which originated it way back in 1887. In 1995 the company agreed to allow Clara Barton’s American Red Cross organization the right to use the insignia as part of its voluntary efforts consistent with a special Congressional Charter awarded in 1900. So what caused J&J to take The Red Cross to court? Well, it seems that the Red Cross decided to use the insignia for income generation (remember the stir over the AMA and Sunbeam.

Well, the Red Cross was generating about $10 million a year allowing the insignia to be used by way of endorsement on products like humidifiers, examination gloves, nail clippers, combs and toothbrushes. Red Cross President Mark Everson says, "The Red Cross products that J&J wants to take away from consumers and have destroyed are those that help Americans get prepared for life’s emergencies….People will buy disaster kits, sometimes on an impulse basis. That American Red Cross image on the there gives them confidence that there are the right things in the kit. We think they’re all done with that preparedness theme."

Really? Humidifiers for preparedness. I guess I just don’t get it. My advice to the Red Cross: focus on streamlining governance, management, consistent processes, direct disaster management, and financial transparency; move gently away from blood management (high liability); and say thanks to J&J (they’ve let you use their brand for more than a century and also have given you $5 million over the past 3 years).

Category: marketing, politics

Comments

6 Responses to “Who Owns The Red Cross?”

jeff pope
December 6th, 2012 @ 9:50 pm

My note is simple. Who actually owns the American Red Cross? Is it owned by a family, individual,or a business? It appears to me that the ARC hides its true ownership. Before including the ARC in my will I would like to know its owner and how to contact him/her/them.
Thank you,
Jeff Pope
Mike Magee
December 11th, 2012 @ 7:38 pm

It’s complicated. The nurse leader Clara Barton and 14 others first discussed their plan on May 12, 1881 to create an American branch of the Red Cross, first organized in Switzerland. Nine days later, 51 individuals signed the constitution of the American Red Cross, and 19 days after that, Barton was elected president. She would guide the organization for the next 23 years, while advancing the profession of nursing and moving for the ratification of the Geneva Conventions. It took another 20 years for the U.S. government to formally recognize the Red Cross, which received its first federal charter in 1900.
The Charter endorsed a non-governmental agency charged on behalf of its government to “furnish volunteer aid to the sick and wounded families in time of war”; “to act in matters of voluntary relief and as a medium of communication for our military”; to “carry on a system of national and international relief in time of peace”; and “to devise means of preventing disasters”. It’s performance has been as checkered as its brand has been iconic and strong. It’s greatest difficulty – managing the blood business. Part public, part private, distributive governance, and mixed missions all are part of this American movement.
mark diodati
December 14th, 2012 @ 11:51 am

seems like we cannot get a straight answer ,maybe I will donate elsehere. I have an idea. I will go to needy communities andd hand out the money myself to the needy
debby
November 3rd, 2016 @ 1:01 pm

who owns red cross today as in now please
Mike Magee
November 3rd, 2016 @ 2:03 pm

The Red Cross governmental organization that works under a Congressional charter.The most recent version of the charter, which was adopted in May 2007, restates the traditional purposes of the organization which include giving relief to and serving as a medium of communication between members of the American armed forces and their families and providing national and international disaster relief and mitigation.
Ra'mona
September 6th, 2017 @ 7:06 am

No way to know who is in control of all our DNA tissues and blood samples. And blood. The center for disease control is a private corporation. Notice it isn’t the Center for disease eradication. Only control. Spreading disease or not spreading disease.
Is our Red Cross owned by the same powers? Was the two agencies partners in spreading hiv?