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What are the ‘dos’ and ‘don’ts’ of international donation?

The Nepal earthquake. The conflict in Syria. Malaria. More than two billion people in or near “multi-dimensional” poverty (Human Development Report 2014). While the world is getting better in some respects, massive needs and injustices remain. Many of us want to do something to help. For individuals in rich countries who lack personal ties to individuals or organizations in poor or disaster-affected countries, “doing something” often means donating to an international non-governmental organization (INGO). But how should we (for I count myself in this group) choose which INGO(s) to fund? While this is a difficult question, and one for which I can’t offer a complete answer, my research on humanitarian INGOs suggests some tentative conclusions.

First, figure out why you are donating. Many of us feel we are donating because we want to “do good,” but this is rather vague. Is your aim to do as much good as possible? Are you trying to compensate for harms to which you have contributed, directly or indirectly? Do you want to honor a friend or family member by contributing to a cause they support? Are you in search of the “warm glow” feeling that comes from joining a collective effort to address a high-profile emotive issue, like the recent earthquake in Nepal? Answering this question is crucial, because pursuing these different aims often leads to supporting different organizations or causes. In particular, donations that honor friends and family or cultivate a “warm glow” feeling often do not do as much good as possible. The suggestions that follow are primarily for individuals who wish to do as much good as possible.

“Haitian Child Collects Water in Camp for Displaced” by United Nations Photo. CC BY-NC-ND 2.0 via Flickr.

If that is your aim, a good first step is to identify and resist the psychological pull of morally irrelevant factors. For example, research on the “identifiable victim effect” supports what INGOs have known for decades: individuals in wealthy countries donate more in response to a close-up photograph of a single child’s face than they do in response to other kinds of text and images. In laboratory experiments, a photograph of two or more people and a photograph with accompanying statistical information raised less money than a photograph of an individual child with no background information. (This helps explain why “child sponsorship” programs raise so much money.) Yet while they tug at our heartstrings, these sorts of images convey virtually no helpful information. They can even be misleading, insofar as they imply that aid recipients are helpless victims. Donors who want to do as much good as possible should ignore these sorts of images.

There are other emotionally compelling features of INGOs or the situations they address that, upon scrutiny, appear morally irrelevant. One is the visual drama. For example, while the presence of large amounts of rubble is visually gripping, many kinds of very serious suffering and harm, such as early death from diarrhea or measles, lack a visually gripping element but are no less important—or addressable—for this fact. Furthermore, many INGOs seek to attract donors by pointing out that they work in a large number of countries. But while it is morally important that an INGO assists a wide range of individuals and does not make invidious distinctions, where those individuals happen to live does not seem to matter.

After excluding morally irrelevant factors, your next step is to identify factors that are morally relevant. One of these is where other people are donating. Some high-profile emergencies, such as the 2005 Indian Ocean tsunami, are “over-funded,” with more money available than organizations on the ground can use effectively. Donating more to these situations is unlikely to do much good. Another morally relevant consideration is cost-effectiveness: how much does an INGO accomplish with every dollar it spends? Cost-effectiveness can be difficult to measure, but it appears that some interventions are vastly more cost-effective than others, at least when outcomes are measured in “Quality-Adjusted Life Years” or QUALYs. For example, Toby Ord argues that providing anti-retroviral therapy to people with HIV/AIDS in developing countries generates 1-2 QUALYs/$1000, while educating prostitutes generates 26 QUALYs/$1000. By taking cost-effectiveness into account, you can avoid funding dramatic projects that tug at your heartstrings but in reality provide little benefit.

“Woman dairy farmer in Bangladesh” by IFPRI-IMAGES. CC BY-NC-ND 2.0 via Flickr

Cost-effectiveness is not the same as the amount of money an INGO spends on administrative costs. Some charity evaluation websites, such as Guidestar, suggest that the less money an INGO spends on administrative (versus program) costs, the more effective it is. But “administrative costs” typically include preliminary research to decide which projects to undertake in addition to after-the-fact program evaluations, both of which are important for ensuring that aid is cost-effective and has minimal negative effects. So while very high administrative costs are a red flag, INGOs with very low administrative costs are not necessarily better than those with moderate administrative costs.

While cost-effectiveness is important, a narrow focus on maximizing cost-effectiveness can, in practice, require ignoring numerous outcomes, processes, and relationships that many people value but are difficult to measure, such as social justice and empowerment of the poor and marginalized. For this reason, incorporating these values probably requires accepting less rigorous empirical evidence that a project is doing the most good.

To summarize—ask yourself why you are donating. If your aim is to do as much good as possible, don’t fall prey to the identifiable victim effect, visual drama, or other compelling but morally irrelevant aspects of INGOs or the situations they address. Do put significant weight on cost-effectiveness, but also incorporate other important values, such as social justice. On a more practical level, remember that larger INGOs often have more capacity than smaller INGOs to do rigorous research and project evaluation, and that INGOs that receive more of their funding from governments are often more constrained by those governments’ agendas than INGOs that are funded largely by individual contributions.

These are general suggestions for how individuals who want to do as much good as possible might proceed in deciding where to donate; they do not lead to the doorstep of one INGO. Insofar as taking the steps outlined above requires information that is not readily available, would-be donors have good reason to ask INGOs to provide it. Donors might also consider funding other types of actors, such as social justice organizations based in the global South.

Once would-be donors have decided which INGO(s) or other organization(s) to support, another question arises: What does it mean to be a responsible donor?  Part II of this post will address this question.

Image Credit: “A child walks on top of a tent in a refugee camp” by FreedomHouse. CC BY 2.0 via Flickr.

Recent Comments

  1. […] Part one of this post addressed a familiar question: how should individuals concerned about international issues decide where to donate money? Here I turn to a second, less familiar question that follows from the first: what is entailed in being a responsible donor after the question of where to donate has been settled? While this latter question cannot be sharply distinguished from the former, my main focus here will be: what are individuals’ responsibilities after they click on the “donate now” button? […]

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