The Giving Conundrum

Over the last week, I’ve received snail mail solicitations from 5 charity organizations. This is about typical. I have given to some of these in the past, so I’ve been on their list.

In looking at the 5, I can recall a specific point in which I felt compelled to donate.

  • MD Anderson Cancer Center
    • Around 2005, a family member had cancer
  • Wounded Warrior Project
    • One of my neighborhood friends is a veteran who shared some stories of his tours.
  • World Wildlife Fund
    • The week before giving to this charity, I heard that giraffes were on the endangered species list.
  • American Red Cross
    • News reports of Hurricane Sandy, Irma, Harvey and Katrina — so many people need quick help after a huge storm like that.
  • The ALS Association
    • I really wanted to film my kid doing the ice-bucket challenge.

ice-bucket

These charities have common names I’ve heard of before I donated, and I had a high-level of trust with them. I wasn’t naive enough to believe that 100% of my donations would go to those in need – there was overhead costs of course. At least 90% though, right?

Wrong.

In 2016, the CEO and COO of the Wounded Warrior Project were fired by the organizations’ board of directors. 40-50% of contributions was spent on overhead, including lavish employee parties.

During Hurricane Sandy, the American Red Cross response was slow & disorganized. Funds were diverted away from programs and toward their image & brand… with a report that 40% of the organization’s emergency vehicles were assigned for public relations purposes.

I didn’t know it at the time, but I gave to both charities at a time when their misuse of the donations was likely. I helped fund the Wounded Warrior CEO’s segway. I helped pay for the glossy photos of the parked American Red Cross emergency vehicles during a hurricane.

The problem is that with some charities, our donations are being poorly spent and we have no idea until after the fact. Our altruistic intentions are not being fulfilled. This is different from volunteering – where your productivity at a given task is directly proportional to the value received by those in need. Donations involve a level of trust in a third party entity (the non profit) residing between you and those in need.

Thankfully, there are some tools out there that help us make well-informed decisions on which non-profits we should trust:

 

In researching these sites, I stumbled upon a statement that got right to the point:

 

With no SEC or federal government watchdog, no investors who will sue if given false information, and loose reporting rules, the nonprofit sector has little oversight and much room for financial manipulation.

From: CharityWatch 

There is homework we must perform before placing our trust in a non-profit. The sites do make it easier – but hands-on volunteering and direct donations to people provide more impact.

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