Help me help people with the least waste.

November 13, 2013 9:40 PM

How much does giving a lot to one charity vs giving a bit to a few smaller charities help a relief effort?

I’d like to donate to help with the recent typhoon and in the US it seems every major source I could donate through is giving to the Red Cross. I know the Red Cross is a respectable charity and they can probably be trusted, but in any disaster there are always several other groups helping out as well. I wouldn’t want to give to the big one to help out a bit more when the same amount could help out a lot more by focusing on another area. I’ve checked various charity rating services but I don’t know how best to judge.

As a bit of background, I donated to a relatively highly rated charity (AmeriCares) for a similar situation several years back and based on their weekly mailings I expect they’ve spent the same on postage to me as I donated initially. It got to the point that I would never donate to them again based on how they seem to spend their money. I’d rather focus on putting the money to good use vs maintaining a donation fund for another time.

posted by fishmasta to Work & Money (9 answers total)

CharityNavigator.org
posted by blob at 9:42 PM on November 13, 2013 [1 favorite]

Could you clarify your question? You've answered the question above the fold yourself by noting that each charity that receives a donation spends a certain amount of time and money recording, processing, and following up on that donation - making multiple small donations to different charities less efficient.

It seems that below the fold you're asking specifically whether the Red Cross would be the best charity to give a single donation for typhoon relief.

But your question could also be interpreted to be "I'm considering giving to the Red Cross but had a bad experience with Americares. Is the Red Cross better or worse than Americares in terms of how funds are spent?" Based on review of the stats from CharityNavigator: 91% of funds donated to the Red Cross are spent on programs and ~5% on fundraising. In comparison, 97.7% of funds donates to Americares are spent on programs, and 1.5% on fundraising - despite their weekly mailings to you. You're really unlikely to do much better than that in terms of percentage of funds donated that go directly to programs, at least if you want to give to a large "respected" charity like the ones you're talking about.
posted by treehorn+bunny at 10:02 PM on November 13, 2013

Response by poster: Sorry. I'm specifically wondering whether donating to a big charity with lots of publicity/etc. will lead to more of the actual money being put to good use as opposed to a smaller charity which may need to spend more money on publicity and future funds outreach. The statistics on CharityNavigator lead to my previous donations, but I don't know if program statistics on the percentage used towards programs might be drowned out by the greater/more effective reach of a bigger charity.
posted by fishmasta at 10:19 PM on November 13, 2013

I would caution against using efficiency ratings as the end-all be-all of effectiveness. The Red Cross may be good at immediate post-disaster relief, but a smaller group that has deep roots in the community may be more effective at longer term rebuilding efforts. Or maybe you are more interested in giving to groups that were underresourced even before the typhoon, like indigenous communities in the Philippines.

Partners in Health has a clear statement on the two general types (emphases added):

We encourage international donors to support disaster relief organizations that are highly coordinated with the government of the Philippines and grassroots organizations that can provide local aid to relieve the emergency needs of the population— medical assistance, food, water, and shelter.

Filipino American activist and artist Kiwi has suggested NAFCON as a beneficiary org.

“Here’s why I highly recommend donating to www.nafconusa.org for Philippine disaster relief: NAFCON work with grassroots organizations in the Philippines that organize among the most impoverished and vulnerable communities all over the archipelago, including those impacted by the recent events. They don’t just show up when there is a disaster. They are there year-round, working to empower and mobilize these communities to address the root causes of poverty and exploitation. While there are villages that the Red Cross will never see, while the Philippine government hoards much-needed resources, our folks will be there at ground level. This is a holistic effort, to not just address the immediate need but also the rebuilding, sustenance, and improvement of these communities.

In general, established Filipino groups (I'm assuming North America as your location, where there are big communities with strong ties to the Philippines, whether first generation or second generation) will have more specific "on the ground" groups.
posted by spamandkimchi at 11:02 PM on November 13, 2013 [3 favorites]

I did Doctors Without Borders for a typhoon-donation, but marked it as general/unrestricted because that's way more efficient. I tried to donate directly to the Philippines Red Cross, but their donation system gave me error messages, so I switched to DWB. I chose DWB based from a shortlist of solid charities, and them in particular because the few people I've met from there were really really ethical and smart, and I like their approach to disaster relief.

You can write to a charity and tell them to switch you to email contact only, or no contact. I know what you mean about wastage - I donated to a small American charity for a friend's charity run several years ago, and still get stuffed envelopes posted internationally. I've said stop, and they haven't and I can't be bothered to contact them again. However, I have written to charities I cared more about to ask for different contact methods and if you can get an actual person, e.g. Sharon Tan in the marketing department, vs a general contact, they will help because they want to keep you on as a supporter. If they don't, then I would switch charities.

The unrestricted donation part is the biggest factor in effectiveness for disaster relief. No-one knows just how much will be raised and where it will be needed because the damage is still being assessed. You don't want to have your donation stuck in an overflowing account when it could be helping people somewhere else.
posted by viggorlijah at 1:22 AM on November 14, 2013

If I can find a small, local, extremely reputable charity I like to give it to them as opposed to a giant charity because i figure small and local has the best internal network and the best sense of where that money is most needed. They're also immediately accountable and likely more transparent (you'll know if a bunch of BMWs appear in their parking lot.)

The reality though is that I'm not in a position to vet small, local charities around the world on a regular basis so if I wanted money to go to a relief effort I would give it to a big organization who would certainly be skilled at judging where that money should go.

With regard to the general question of is it better to give ten dollars to ten parties or a hundred dollars to one party, I think the latter is most efficient and provides opportunities that one doesn't have if one only has ten dollars. They can take care of needs that cost ten, twenty, thirty...or a hundred dollars. The ten parties with ten dollars can all only take care of items that are less than ten dollars--so they all can buy toilet paper but only one can pay to have a toilet fixed.
posted by A Terrible Llama at 2:39 AM on November 14, 2013

Perhaps what A Terrible Llama was trying to say was that larger charities can take advantage of economies of scale with their purchases, which could result in incrementally improved efficiency of funds usage. Because of course, even if you give a charity $10, that's not all the money they have to spend - your donation is combined with all the other donations received and then the projects are budgeted accordingly.

Unfortunately, I'd say that small and local charities are not necessarily more trustworthy and transparent - the fact is that large charities have to file all kinds of paperwork and generally have all their accounting/budget info available readily online, while small charities may not even have a website and their actions and budget may not be publicized or available at all to international donors.

To respond directly to your update, there are pros and cons to either one. A large charity may have the benefit of name recognition (i.e. everyone has heard of the Red Cross), but they still spend tons of money on marketing to keep it that way. Small charities don't take out full page ads in TIME magazine - the Red Cross does. So you really do need to look at percentages here - the Red Cross may only have spent 5% on fundraising in their last annual budget, but that still translates to $174 million spent on fundraising because they have such a huge budget. So when you say that a smaller charity "may need to spend more on publicity and future funds outreach" (i.e. fundraising), it's highly doubtful that the actual amount of money spent is going to be anywhere near what the Red Cross is spending.

You also suggest that a large charity may have a "greater/more effective reach" - again, not necessarily true. Yes, a large charity will serve a larger number of people, generally speaking. But if by a "greater reach" you mean that a large charity will have a relatively greater impact proportional to the funds spent, I think that is very questionable. There is no easy answer to that question.

Let's say a larger charity can get a better deal on blankets for disaster relief victims, because not only can they purchase blankets at a lower price per blanket when they buy in bulk, they're also getting donations of blankets pouring in from concerned citizens who want to help in the relief effort. The problem is that the donated blankets are mixed in with a mountain of other items like used toothbrushes, old sneakers, and expired food items, and so the large charity has to spend a lot of money and energy dealing with sorting and disposing of the useless items, and sorting the good donated blankets from the moldering and mildewed blankets that were donated. However, the larger charity is still able to swoop in and provide 10,000 blankets in the end, and splashes that fact all over their marketing materials in the relief effort follow up and the next year's annual report.

The donors who supported the purchase of those blankets may never know that in fact, the temperatures in the post-disaster area were balmy and no one actually needed blankets. The local community-based organizations knew that the people were actually clamoring for safe drinking water and dying of cholera. The blankets were all distributed in the most populous areas of the cities, and the people in the more rural and remote areas, who were most in need, never saw a shred of the aid provided.

This is just a silly example, but what I'm trying to tell you is - "waste" is relative. Being able to take advantage of a cheaper bulk price doesn't matter if what you're buying is not what's needed. In order to judge the impact of a charity, you need to know much more than how much of something they're providing - you need to know how they assess needs, how they monitor and evaluate their programs for effectiveness in addressing those needs. You need to know if they care whether they're providing the right things to the right people in the right ways. You need to know whether what they do is ethical and culturally appropriate. You won't find this information in a charity evaluator database. You would need to really read through whatever materials the charity makes public to judge these things, to look at what experts are saying about their work, and ideally to witness their programs in action yourself. Most people don't have the time or energy to do this kind of research, so sites like Charity Navigator at least give a basic level of assurance that money isn't being squandered wholesale. I fear that many people who begin to look into nonprofit effectiveness get easily discouraged and just throw up their hands and feel like they'd rather not give to charity at all. There are so many charities doing amazing things out there. Don't let the perfect be the enemy of the good. I applaud you for caring about how charities spend their funds and for wanting to give.

Bias: I founded and run a very small charity.
posted by treehorn+bunny at 6:13 AM on November 14, 2013 [3 favorites]

"...based on their weekly mailings I expect they’ve spent the same on postage to me as I donated initially."

Whenever I donate, I request that they send me no paper mailings. (I accept email, but you don't have to.) Those requests are honored about 90 percent of the time. If I do get a paper mailing, I email the fundraising department and ask to be removed; it's their job to keep donors happy, so that works almost all the time.
posted by Mr.Know-it-some at 6:52 AM on November 14, 2013

I do want to caution donors that a charity with low overhead doesn't mean that charity is more efficient than one with higher overhead. Overhead is, for most charities, part of what they do. It's essential for providing services, so it really isn't that different from the services themselves. (This is not to say that there are no inefficient charities, only that measuring overhead is so crude as to be largely worthless.)

For a disaster relief agency, direct services include food, water, transportation. But the administration is just as necessary: obtaining the food, arranging to transport it, cataloging it so that the organization knows what it has and where it is and when it expires. In the absence of these administrative tasks, food piles up, goes no where or goes to the wrong place, and ultimately goes to waste.

Also, seeking donations is as essential a function as any for a charity. A charity that doesn't actively seek donations will cease to exist, and therefore will cease to provide services. You can certainly help them reduce their donation-seeking costs by telling them explicitly what sorts of solicitations you will and will not respond to. But assuming that the very fact that they seek donations is a problem is to deny them the ability to get funds that they can use to provide services.

In summary, to answer your question, your money will be well spent if sent to the Red Cross for something like the typhoon (because the Red Cross has masses of experience, economies of scale, and the political connections to get in there and help). And for disasters closer to home, where you're capable of doing the research to find a good local group, that's a good way to donate, too. All these groups fill different niches, and you do well giving to any of them.

Giving at all is more important than finding just the right way to give. Thank you for caring and for giving.
posted by Capri at 10:36 AM on November 14, 2013 [1 favorite]