Tim Ogden of Philanthropy Action weighs in on the recent debate:
“Jacob has already pointed to the Hope Consulting study that Hewlett partly-funded. I encourage everyone to read it (it’s available at www.hopeconsulting.us) because it offers another important piece of the puzzle in this regard (note that, like Jacob, I have a connection to Hope Consulting–they are a client of my firm).
The Hope data shows that while 85% of donors say they care about nonprofit performance only 35% ever do any research. Another set of questions hints at why. Donors say they are actually quite satisfied with the performance of the charities they give to, and think those charities have excellent leadership.
When you combine this finding with the fact that overall confidence in the nonprofit sector has been steadily falling, it becomes clear (to me at least) that we are confronting the Lake Wobegon problem.
Donors believe that all the charities that they support are above average. While there are problems in the charitable sector and ineffective charities–those are the charities that other people give to. Why would a donor convinced that their charities are effective have need of a rating system or external validation? Why should they waste any time on researching performance even though they care about performance? These donors already know the answer to the question. Similarly few parents spend much time doing independent research about whether their child is lovable and cute or above average.
So a big portion of the challenge is one of helping more donors understand that not all charities are above average. And some of the ones below average may in fact be charities that they give to. But right now not very many donors are willing to give up their a priori beliefs that their charities are good charities (cognitive dissonance is a powerful force). And often when they come across a rating system that grades their charities poorly they conclude the fault is with the rating system not the charity.
I would add to Jacob’s list (perhaps a sub-point) that another piece of the puzzle to changing behavior is convincing people that the outcomes directly related to their actions are suboptimal. I suspect that to do this we need to engage the elephant more than the rider in the Heath’s rubric.”
5 Comments
So how do we help the average donor to become enlightened? How do we help them to understand that it’s possible that they are making the wrong choices?
To start with, I think the average donor needs to be made aware that there are serious consequences to funding the wrong organization. At a min you may be wasting your money with an ineffective org when instead you could be supporting an effective one. But the worst case is that you end up funding a harmful program. I’ll bet that this notion never enters the mind of most individual donors. If it did, then maybe they would be more interested in research before investing.
We’ve debated the idea of trying to insert the concept of harm into the individual donor’s mind here before. But the concern is that this would hurt total funding in general. I’m afraid if we’re really interested in some significant change in donor behavior that a little shock therapy might be needed. We need something equivalent to an anti-smoking campaign.
I totally disagree Jeff. Smoking is unequivocally bad for you. Getting people to stop is a good goal. Giving to charity is a very, very good thing. We’re looking to help people give better/more, not stop. Yes, I agree that some charities actually do harm (from misguided programs, not malice), but that’s not typical.
We need ways to better engage donors in ways of doing great philanthropy. Not make them feel bad about themselves.
I think talking about how some charities do harm can be a useful hook to start a conversation, but it cannot be a major messaging point.
Sean,
All charity isn’t a good thing. It’s just not. If you give to a program that increases the chance that a child will end up in jail or the program increases the violent tenancies of men involved with domestic violence, or the program results in another broken relationship that a child needs to deal with how is this good? And please don’t say it’s good because the donor feels some kind of pleasure or a sense of belonging. That’s not what this is supposed to be about.
Today millions go to orgs with no effect (wasted money) and those that have been shown to be harmful. This information is widely available – if you choose to read it. We need to dig our heads out of the sand.
This sector is responsible for addressing some of the most pressing issues that face mankind and yet MOST don’t have the high-performing characteristics that you have laid out previously. As a result most orgs have no clue whether or not their work is having any positive effect. They work blind, simply hoping that their good intentions will save the day.
When you say that it’s not typical that orgs do harm, how do you know?
It is clear that not all nonprofit do good work. There is evidence that some nonprofits do harm. But I think it is a huge reach to suggest that this is a significant issue. I am far more receptive to the idea that many, many nonprofits have no impact. But simply by virtue that 10% of the US workforce is using $1.5 trillion a year in revenue to try to effect impact suggests to me that it is highly unlikely that they are have no impact on a net basis.
The problem we are facing is one of optimizing philanthropy from having some impact to having a ton of impact. The problem of orgs that do harm is real, but not the large issue.
I of course can’t prove that the average org is having an impact just as you can’t prove the opposite. That’s the crux of many of our problems.
Sean, without a doubt some are causing harm. Some of these programs are also large and widespread with millions going to them. This is a fact. The reason for pointing this out is that if a donor isn’t careful about where they choose to give then they may unintentionally fund harmful activities.
I don’t believe that most donors, especially individual donors, realize that it is possible that their money could be supporting a harmful program. I believe that if donors were aware of the potential consequences of uninformed or ill-informed giving that they would be more diligent.
If donors understand that there are orgs that are capable of generating social value AND there are orgs with no impact, AND there are also those who are doing more harm than good than they will strive to fund the effective orgs.