Mo' Money, Mo'... Questions? How to Make Smart Choices With Charities
I had a really enlightening conversation recently about giving. It was just about the simple act of saying, “Here. Here’s a few bucks, it seems like you really need it.” After all, at last count, there’s roughly a kajillion charities in this town with arms wide open. Is there such a thing as giving right? Or (gasp) giving wrong? Will I get tarred and feathered for even asking that?
Charleston magazine’s Giving Back awards—an annual event held jointly with the Coastal Community Foundation (CCF) that honors the best and the brightest in local philanthropy—is Friday, but oddly, this topic didn't hit my radar as part of a plug for my employers’ event (though, really, you can get tickets here—the event's this Friday night, November 15 at Memminger Auditorium. Food by Cru, drinks, Shiny Disco Ball Band... it'll be the bomb. Hurry up and get your tickets before they're gone).
Back to it: This conversation about "wrong ways to give" came about surprisingly organically. I was at the home of local philanthropists Julie and Marty Klaper scouting their extensive art collection, and, well, it was happy hour. Bring on the lively discourse.
I sat down on their sofa with some wine, nibbled on some cheese, and listened to the pair tell their story. It wasn’t long before the conversation turned to Marty’s work as a board member of Social Venture Partners—an organization that, together with CCF, identifies promising not-for-profit organizations and helps shepherd them into better financial health and long-term viability. The board draws on the experience of its members—many of them accomplished former business execs—who’ve previously worked magic in the private sector.
Here’s what hit me: This was no Pollyanna conversation about how great it is to help those less fortunate. That was only the unspoken end game. Rather, Marty had some thought-provoking ideas about how we give, why we give, and how we could do it better.
There's a chance you'll think I’m trying to turn you into Ebenezer Scrooge just in time for the holidays—so be it, but I warn you, you'll miss the point.
« The idea is not to give less, says Marty. It’s to give in a way that makes a measurable difference.
I was drinking plenty as we spoke, so fortunately for you, I made a date with Marty and the delightful Edie Blakeslee of CCF to talk more about this when I could actually take notes (rather than just drinking all of Marty and Julie’s wine). Maybe you’ll find this topic as interesting as I did?
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« Let's start with Charleston’s philanthropic culture? What's it like, in your view?
Edie: Robust. If you’re simply looking at those the IRS views as benefiting the public, there are around 1,700 charities in the tricounty area, including church outreach organizations. And I’ve always thought of our nonprofit community in Charleston as the MacGyver of charitable activity—we make do with duct tape and pennies, trying to do a lot with very little. Most have shoestring budgets, and it’s difficult for many of them to think beyond the coming year.
« Generally speaking, why do people give?
Edie: Two reasons really stand out. One, people tend to give because they’re asked. A friend asked me just last week to donate to raise awareness for blood diseases—her daughter was running a race and needed supporters—so I did. Or very often, a friend is serving on a charitable board and asks you to give. In either case, our automatic human reaction is to support the person that you know.
Also, people give based on what makes them feel good. It feels good to help a friend who asks for a donation, it feels good to give to a charity that supports a cause you care about.
« Is that a bad thing?
Edie: Not necessarily. But what if you pushed your thinking past that? Think about why you give. And what its effect will likely be. Could your money go further?
Marty: Think of it the same way [SVP] does when we’re considering helping an organization. We’ll ask what they do, how they do it. We’ll make sure the people who are leading it are talented and passionate people, who we believe can drive them internally. But the real silver bullet for us is this: what are the outcomes they are delivering? A lot of organizations have very good outputs, which is different. In other words, they do a lot of wonderful things, but the question is whether those outputs translate into outcomes. It’s about creating a measurable benefit in the community, similar to putting your money toward a good business investment. The average giver could ask the same questions, and really hone in on the charities that have the resources and strategic planning in place to promise the best return in their communities.
Marty: You’ll find that many philanthropic organizations are in constant crisis mode—they spend so much of their resources surviving from year to year that their ability to make a real impact is limited. You simply can’t do good work if you’re spending most of your time surviving. That’s one of the ways SVP helps—we look for organizations that have a good long-term viability model in place, good people in place, and help them move forward to sustain themselves.
« You believe that same concept works for personal donations?
Marty: It does, and here was my turning point: one year, my wife and I were doing our taxes, filling out our charitable contributions, and we were able to see what we’d given across the previous year. We gave away thousands of dollars to organizations that bore no importance to us, and we had no idea what difference we’d made. We were simply asked to give—so we did. That was our turning point. It took a lot of discipline, but we began to give differently. We learned to be able to say to someone, “We can’t do that, but we can outline where we do give, so you understand that we’re charitable people.” Because the truth is, this is about real money. The idea is not to give less. It’s to give more strategically, in a way that makes a real impact and brings about change.
Edie: When my family and I sit down and talk about what we believe and what we have the resources to support, we want to be able to say that for the most part, our philanthropic checkbook reflects those same priorities. I’m a middle-of-the-road gal, so I may still make some spur-of-the-moment donations, but for the most part, you want your money to go towards great outcomes with thought to who they are and what they do.
Marty: If you begin asking the right questions of the charities—how do they measure success, what are the results thus far on a whole, rather than anecdotally—this can really shape your investments. You might hear some really good results, and say, “Wow, I was going to give you $1, now I’m going to give you $10. What a good investment.”
« My guess would be that the most common form/mode of giving in this town is through events. There’s a ticket to good food and good auction items around every corner—is this an effective way to give?
Marty: The trouble is, it shifts the focus to entertainment and away from that core goal: creating measurable outcomes. Only a percentage of your money will go toward the clients that charity serves—the rest will go to the event. These can often have enormous overhead, with the organization spending $10 just to raise $15.
Edie: I’d encourage any organization to consider all the expenses when considering an event. That includes staff time, which can be the real hidden cost of these undertakings. When they spend months working towards one event, what core efforts towards the people they help are being lost? Now if the event has a purpose like awareness building, often that’s worth it. But you can’t event your way out of a budget deficit.
« Additional takeaway advice?
Edie: The more that we understand the missions, the outputs, the outcomes of charities, the more we cultivate the long-term relationship between the organization and the giver. These conversations should be part of any thoughtful giving plan—create priorities, ask questions, and look for great outcomes.
Marty: Giving wisely isn't just about handing over money. Making a real difference isn't about giving a hand out, it's about giving a hand up. It's about deciding where to give and how best to help those organizations be able to focus their time and resources on helping their clients.
What do you think? Agree? Disagree? Let me know... Also, if you want to learn more, SVP recommends picking up the book Toxic Charity by Robert Lupton. They recently hosted Lupton at the Riviera Theater for a sold-out discussion on the unanticipated effects that charity can have on the people meant to benefit from it. From the excerpt on Amazon: "Toxic Charity shows us how to start serving needy and impoverished members of our communities in a way that will lead to lasting, real-world change."