Not all charities are equal
While some charities have an enormously positive impact, many others make no difference at all. This might sound surprising and that’s because charities work hard to develop fundraising pitches at the core of which are detailed descriptions of how your donation does good. But have you ever examined these claims and asked for the evidence of their impact? If you answered no, you’re not alone. Charities are rarely expected to demonstrate that their actions (or interventions as we refer to them) are actually saving lives, reducing suffering, or improving wellbeing.
Let’s consider, for example, PlayPumps. PlayPumps are water pumps that look like children’s roundabouts. Their goal was to provide rural communities and villages in Africa with a better mechanism to draw clean, fresh water while children play. Seen as an exciting new innovation and an opportunity to help those living in extreme poverty, PlayPumps drew the attention of celebrities and multinational corporations who raised huge sums in donations. Intuitively, the PlayPump sounded like a great idea. It was only when UNICEF performed a thorough evaluation of their program, that many issues were uncovered. The PlayPumps not only failed to have a positive impact, they actually made lives more difficult for the people they were trying to help. The PlayPumps turned out to be more work than fun for children which meant women were left to the task; and they proved to be more expensive, less functional and more maintenance than the hand pumps they had replaced. In hindsight it became clear that a mechanism requiring positive displacement such as a pump would function differently to a roundabout where kinetic energy keeps the play equipment spinning. It might also seem obvious to conduct trials to test interventions for their efficacy before implementing them on a large scale. Despite the evidence that PlayPumps are harmful, the organization still exists and you can still donate to it today. What this example shows us is that if we don’t ask for and consider evidence of impact we could be wasting our time and money.
The absence of evidence
In large part, the reason charities can’t or don’t provide high-quality evidence to demonstrate their impact is because we (as donors) have rarely asked it of them. We might donate when asked, donate to support a friend or family member, or donate to support a cause that has impacted our lives. By studying our giving habits, charities focus their efforts and limited resources on strategies that bring in the most funding. So instead of spending resources gathering data on impact (which their supporters won’t request to see), charities might opt to use those resources on highly effective marketing material which promotes their work. GiveWell, one of the most rigorous charity evaluators, writes that “[b]ecause charities aren’t being held accountable based on impact, there are probably a lot of charities that continue to raise and spend money but don’t make any difference at all.” Upon realising that not all charities actually make a difference you might be wondering: well how much does effective giving really matter?
Effectiveness matters, a lot
We happen to live in wealthy, scientifically advanced, and politically stable societies where our basic needs are met and we have access to sanitation, education, and healthcare. Even if you don’t personally consider yourself wealthy, even if you earn less than $11,000 USD per year (below the US poverty line) you’re still wealthier than 85% of the world’s population. It doesn’t cost much to make a real difference in the lives of those less fortunate and that’s because the best interventions are many times more effective than others. Consider, for example, health interventions. GiveWell estimates it costs $7500 through the Against Malaria Foundation (AMF) to prevent one malaria-related death. This figure may seem high, but based on existing evidence is actually one of the most cost-effective ways to save a life in the developing world. We can compare this to wealthy countries like the US where, depending on age, it could cost between $790,000 – $13,100,000 to save a life. If we believe that regardless of where someone is born, one human life holds the same moral value as another, then it seems clear that we should save more lives by donating to AMF. AMF is also an excellent example of the huge amount of good we can do when we request evidence and hold charities accountable for their impact. You have the opportunity to literally save lives and reduce suffering. But as we’ve seen simply giving isn’t enough, you have to give effectively.
To give effectively, we need to understand the problem we are helping to solve, how our donations are being used, and compare the costs and effects of a range of interventions. This isn’t easy, but thankfully, a number of charity evaluators and research institutes (such as GiveWell, Animal Charity Evaluators, the Open Philanthropy Project, and the Foundational Research Institute) are working hard to make this information available. At REG, we use this information to learn:
- Which problems we should focus on; and
- How to evaluate charities to identify which ones are doing the best work.
Part Two will explore the first of these: the problems on which we should focus. We’ll also discuss frameworks to help you select a cause.
If you’d like to delve a little deeper into the concept of “effective giving”, below are some excellent resources.