Posted by Eileen Ellsworth
This is the fourth post in a series reviewing the book “Giving 2.0” by Laura Arrillaga-Andreessen (Great Giving LLC, 2012)
A 2010 Hope Consulting study shows that while 85% of American donors say that nonprofit performance is “very important” in their giving decisions, only 35% actually conduct research before writing the check. And of the donors who say they conduct research, only 5% actually use it to assess the quality of the nonprofit they’ve chosen to support.
Why do reason and logic play such small roles in the process of philanthropic giving? According to Laura Arrillaga-Andreessen, the author of “Giving 2.0: Transform Your Giving and Our World”, it is because too much of our charitable giving is emotionally driven. Indeed, a primary goal of Giving 2.0 is to help donors become aware of this phenomenon and therefore balance their heart-driven philanthropic impulses with information and data.
Assessing the performance of nonprofits is difficult, especially for individual donors, because they try to measure something that doesn’t readily lend itself to measurement, like the long term effectiveness of job training services for economically disadvantaged populations. While evaluating the outcomes of a nonprofit service is difficult, good feedback from the nonprofit on the impact of your gift does help. Anecdotes and stories, when combined with data and metrics, can be very useful.
If you are particularly sold on a nonprofit – their mission and strategy to achieve it – then by all means support their operations. When a nonprofit has enough revenue to fund its operating expenses, nonprofit leaders can focus on what they do best – deliver services, improve their models, connect with service recipients, and have an ever improving and impressive impact on the need they have chosen to tackle. These “capacity building” gifts hold up the sky for a nonprofit, which in turn holds up the sky for its service recipients.
It’s a question of whether to support immediate needs or long term change – two interdependent targets of philanthropy. As a donor, take a moment to pause and consider both before you give.