Making Your Donations Matter

Susan Ostrander has written extensively about philanthropy, and helps steer us in the right direction for charitable giving
hands holding pennies
“Your giving should be grounded in some understanding of where the greatest needs are, and which organizations are doing the best job,” says Susan Ostrander. Photo: iStock
December 13, 2011

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The holiday onslaught has begun. No, not the gift buying, but the envelopes piling up on your kitchen table with pleas to help save this animal, that child or even the planet. Beyond the heart-tugging photos and stories, most of us truly want our donations to have a real impact. Yet most of us know precious little about how best to invest our charitable dollars.

Susan Ostrander, a professor of sociology in the School of Arts and Sciences who has written extensively about philanthropy, nonprofit social organizations, volunteerism and civic engagement, points us in some helpful directions.

Tufts Now: How can you know if charitable giving makes a difference?

Susan Ostrander: Total giving to charitable organizations was $290.89 billion in 2010, or about 2 percent of GDP. The majority of that came from individuals, who gave $211.77 billion. That’s a lot of money, but philanthropy actually makes up a relatively small portion of nonprofit revenue. Cutbacks in government spending have really hurt nonprofits. Real support for the important work of nonprofits means supporting both private and public funding working together.

Does it matter that I can afford only small donations?

Wealth has become increasingly concentrated in the United States since the 1990s with the top 1 percent of the population now owning nearly 40 percent of the wealth. In income terms, this top 1 percent contributes one-third of all charitable dollars. Smaller donations account for two-thirds of the much-needed funds, so small donations are very important.

“Smaller donations account for two-thirds of the much-needed funds,” says Susan Ostrander.What should I think about when choosing a charity to support?

The choice should include not just your personal reasons and goals for giving to a particular cause. Your giving should be grounded in some understanding of where the greatest needs are, and which organizations are doing the best job. Most charitable gifts go to organizations that are already wealthy. Much less goes to organizations struggling to address issues like poverty. I’d encourage donors to give not only to the big, well-known charities but also to the smaller community-based organizations that are closest to the people most in need, and also to advocacy organizations that address the root causes of why so many people are in need in the first place.

Going to an organization’s website can provide important information, but may not give the kind of data that donors need most. I give money almost exclusively to organizations with which I have established some connection. This can be as simple as attending events to learn firsthand what their work is about, getting to know the staff doing the work or volunteering. Research shows that when we volunteer for an organization we’re more likely to also give money to that organization—and to do so in a more informed way.

Is there a way to determine which charities are doing the best job?

Donors should look for clear evidence that the organizations are assessing the impact of their programs or activities, and that they are having the results they claim. Unfortunately, few nonprofits evaluate their impact. Assessing results is complicated and costly, and nonprofits are afraid that if findings are not completely positive donors will turn away. So donors should allow charitable organizations to take some risks and be innovative, even if results are not positive all the time. That’s how organizations learn and get better.  

Around the winter holidays especially, the news media typically provide links to Better Business Bureau-like sources, such as Charity Navigator, so donors can check out nonprofit charities. The problem with these sources is that they almost always focus on the organization’s financial situation, and not on what the charity does and how well it does it. This focus on finances often translates into the already-affluent charities getting the highest ratings, while those that need the money most—and are doing good work—are left in the dust.

Can I rely on the veracity of the photos and stories the organizations provide?

Nonprofits like to present compelling stories about how particular individuals were helped by their programs. These stories, while usually true, are often not the best indicators of the overall impact of the organization’s work. Most fundraisers believe that donors like these stories and that they are effective in bringing in money. Donors need to ask deeper questions.

Why do you think that nonprofits engaged in work to help the poor and combat poverty are especially worthy of support now?

I think the data shows clearly—and has for the past two decades or so—that the growing income-wealth gap in the U.S., plus the consistently high child poverty rate, are among our most pressing national problems. This is partly because poverty connects to a wide range of other issues, such as inequitable funding of public schools, the out-of-reach cost of higher education, the low pay many workers receive for very hard work and the high cost of health care.

These problems have been around for a long time, and are exacerbated by the current economic crisis. According to the US Census Bureau, more than 46 million Americans now live in poverty, about one in seven of all Americans, and nearly half of all African-American and Latino children.  Many organizations address these needs through hunger relief and community support services, but I would strongly urge donors to focus at least some of their giving on those charitable organizations that advocate for the larger social changes we need as a nation to address growing inequality.

Gail Bambrick can be reached at gail.bambrick@tufts.edu.

 

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