What makes you say that? I can think of several examples of those kinds of situations in society at large, like climate change for example.

Asymmetry of reciprocity and adversarial selection mean those who can evoke empathy without reciprocating gain the most; those willing to engage in manipulation and parasitism find a soft target in institutionalized empathy, and any system that prioritizes empathy over truth or logical coherence struggles to remain functional.

Reciprocity and beneficial selection operate over longer cycles in a larger society than they do in smaller social units like families. Some altruistic efforts will be wasted, but every system has corruption: families can contain all the love and care you can imagine and still end up with abuse of trust.

The more help you contribute to the world, the more likely others' altruism will be able to flourish as well. Sub-society-scale groups can spontaneously form when people witness acts of altruism. Fighting corruption is a good thing, and one of the ways you can do that is to show there can be a better way, so that some of the people who would otherwise learn cycles of cynicism make better choices.

Do you have any evidence that the empathy free institutions you would implement would somehow be free of fraud and generate better outcomes?