Do Donors Care About Impact? Not Really.

One of the most fundamental yet usually-unspoken assumptions of the philanthropy world is that if we get better about measuring social impact, donors will all of a sudden start to prioritize impact metrics as a motivating factor for their donation decisions. This is an "If you build it, they will come" belief, and I just don't buy it.

Sean Stannard-Stockton brought this question up most recently with his post "Do Donors Care Whether Nonprofits Are Any Good?" His question was sparked by a recent UK survey that suggested, among other things, that only 40% of average donors would be interested in independent charity ratings, a full 68% do not think such a rating system would impact their decisions, and only 25% would be more likely to give.

Uh oh. That's some pretty damning evidence that donors don't care.

But at this point, it's useful to parse out classes of donors. There are fundamental differences among a private foundation with an endowment and a board of trustees, a family foundation or donor advised fund, and your average citizen philanthropist. The most important difference is not about magnitude but about motivation.

I believe that the further the apparatus of giving is from the person whose money is being used, the more likely to be interested in impact metrics a certain class of money will be. What I mean is that a group like the Ford Foundation has a mandate to address a particular set of issues. For them, their raison d'etre is their impact.

For your average personal donor, it's something much different. Most people give because they feel a longing to be a part of something bigger than themselves.

Churches receive (by far) the greatest percentage of annual American donations (about 35% of all giving in 2008, compared to the next highest, education, which received 13%) in large part because of the sense of community that they provide their congregations, and the connection to a human lineage that extends even beyond those on the earth today.

We're seeing online and in youth communities an extension of this phenomenon. Causes, Americas Giving Challenge, and all of these other competitions and giving platforms are fundamentally about making it easier for people to ask their friends to support things they already care about. Basically, they're community building platforms that happen to use donations as the bonding force.

The important thing to recognize here is not that people are un-interested in impact; it is to recognize that when people give with a desire to be part of a community, or reinforce their investment in friends, the emotional satisfaction they get from their gift -- their personal impact, you could say  -- is immediately gratified at the moment of giving.

Think about that for a second. To most givers, what is real and close-by is the feeling of being in fellowship with other givers or the person asking you to donate, and what is abstract is the theoretical impact that this will have on people you've likely never met. When you have a tangible emotion (the act of giving) competing for importance in motivation with an intangible abstraction (the knowledge of impact), it is real hard for even the most engaged of us to prioritize the intangible.

Put it another way. When you have thousands of young people getting passionately exited about the new cause du jour that their friends are pouring themselves into, whether it's Invisible Children or Charity:water, how do you think it's going to go over when you critique those organizations, or even question the idea that their approaches may not be the best to solving the problem at hand? Because of the emotional connection that drives the philanthropy and action in the first place, you're effectively criticizing not just the organization but the person whose supporting them. In the process, you're making the donor feel dumb and alienated. Bad plan.

Basically the point is that when people become emotional invested in a cause shared by a friend or a community, they take on faith that there is impact. This is why it doesn't surprise me to to see that 68% of people wouldn't really listen that much to independent assessments. Evolution has spent a million years helping us have good instincts about the people we let into our lives, but now we have to trust a report from people we've never met?

The point is, it's not that people are dumb, or ultimately only care about their warm fuzzy feelings. Most people that I've met genuinely believe in the causes they support, and believe they're helping achieve change. It's just that their "due diligence" is all about who brings them through the door and the community that surrounds them there, and they will trust that over more abstractions.

So what's to be done? The good news is that I think ultimately increasing donors is a shitty reason to care about impact metrics.

To the extent that there can be a culture shift to focus on impact among foundations and "professionalized" change makers, great. But I think the real culture shift is to get nonprofit leaders to recognize the intense responsibility they have for constantly improving impact.

To be a nonprofit leader means to be someone who is always focused first on the people ultimately being served, and to be a leader who acts as a shepherd for a community of donors who have faith in their contribution to that service. Being a good story teller is a fine skill, but ultimately the game is what happens on the ground, not what happens in the conference hall. If we got every nonprofit leader and social change architect to think like that, the donors would follow.

Photo credit: dbaron