The One Thing You Need to Know Before You Donate to Charity this Holiday Season

The holiday season is one of the busiest times of year when it comes to donating to nonprofits and causes. Every organization and their mother has some sort of matching offer or competition they're promoting, and it seems like every one of them knows how to get to you. Even for the involved giver, it makes it hard to figure out what to spend your limited resources on. One solution long-proffered is to focus on organizations that have low overhead, but as even the former leading proponent of this line of thinking, Charity Navigator, announces that its moving to expand its assessment metrics, the question is what does someone really need to consider to make their holiday giving decisions?

I've invited some of the top philanthropy and social change bloggers to answer just that question. Over the next few days I'll be linking to their posts explaining what they think is the one thing you need to know before you donate to charity this holiday season, and updating this starter post to include some of their most insightful wisdom nuggets. At the end of it all, we'll have a great resource for you to think about as you make your own donations, both this holiday season and year round.

To kick things off, I think the one thing you need to know is who plans the programs you intend to support? More specifically, how are the people who are the supposed beneficiaries involved in that process? Most organizations talk a lot about "empowerment," and "engagement," and I think they do it with the best of intentions. But its a lot harder to really engage communities from the very beginning of the development process than it is to give them leadership roles once things are planned. In my (to be fair, limited) experience, it sometimes doesn't matter how "well-thought-through" a program is if the people who are supposed to benefit from it weren't doing some of the thinking.

So if everyone organization says this, how do you find out who is legit? Do your homework! It's hard but you can use charity review sites to get some information. If its a big organization, Google it and see what people have written about it in the past. If its a small organization, email the founder or the staff and ask them. Remember, you're not just donating to make yourself feel good - you're making an investment in hope and an investment in someone else's future.

Who's got something else?

Update #1: Beth Kanter
Nonprofit social media guru Beth Kanter just posted her response to this conversation. She writes that "...most of the donations I tend to make have been requests from friends or colleagues to support their charity.  My giving is usually in very small gifts - $10 here and there, sometimes $20.   So, I make decisions based on the friend's credibility and judgment and if I'm not sure, I ask the friend."

I think it's a great suggestion, in one way because it "doubles" your impact in the sense of your both investing in a cause as well as the people behind it which I think is important to growing a healthy nonprofit sector.

Update #2: Amy Benziger - Social Capital Media
One of the awesome people behind the Social Capital Markets conference this fall, Amy Benziger, blogs about how investing in microcredit programs means the opportunity to use the same dollars over and over:

"I think that the greatest way to give a gift this holiday season is to visit websites like Kiva.org and Microplace.com and start an investment portfolio. You’ll not only be giving individual entrepreneurs around the world the gift of a micro-loan to start their business, you’ll also be giving the gift of dignity and empowerment that the responsibility of an investment brings. The money that they will pay back will later go to fund another entrepreneur to get off his or her feet"

Update #3: Paul Brest - President, William and Flora Hewlett Foundation
Paul Brest, President of the William and Flora Hewlett Foundation and Co-author of Money Well Spent: A Strategic Plan for Smart Philanthropy, asks whether your donation actually makes a difference. In this post he suggests that the key information about any nonprofit is not "what it aspires to do, but how much of a difference it is actually making."

Still, and I think importantly, he allows for the fact that this is an emergent process:

"If an organization doesn't yet have the means to collect data on actual outcomes, a reasonable proxy, at least for the time being, is to clearly describes its goals, its strategies for achieving the goals, and why it believe the strategies will work. On the flip side, an organization's inability to provide this information should be a warning sign to donors."

Update #4: Holden Karnofsky - GiveWell
In the last year or two, one of the strongest and smartest voices for a serious reevaluation of the way we give has come from Holden Karnofsky and the folks at GiveWell. GiveWell's premise - that not all, and maybe not even many, charities are doing great work and that we should say "no" to those that aren't - may seem harsh to some, but they're backing it up with serious qualitative research about which organizations are creating real change.

Given all that, it might be no surprise that Holden's advice to holiday givers is that "you need to know that your favorite social program might just not work."

"The first $17,000 I ever donated (personally) was to programs that I now believe don’t work. During my years in the finance industry, I gave to the best organizations I could find for improving education (jr. high and high school) in NYC.

I considered education my favorite cause. I assumed that equality of schooling was the key to equality of opportunity. I didn’t have the time or the energy to question this assumption. I now believe this assumption is badly wrong, for reasons that are outlined here.

I wish I could take that money back: de-fund the “small schools” and extracurricular activities I supported (both of these are programs I now know to have very questionable, if not negative, track records) and instead fund programs for early childhood (where I believe inequality of opportunity really begins) or international aid (where it’s far more drastic).

I wish that money had gone to organizations that I really believe are changing lives in a significant and lasting way, but it didn’t. Please don’t make my mistake."

Update #5: Britt Bravo

Nonprofit tech consultant extraordinaire Britt Bravo uses an incredibly effective analogy to share her advice to holiday donors. She suggests that our holiday giving is like buying gum at the store:

Do you know why they put gum, keychains and other small, low-cost items at the checkout counter? So that you'll throw them in your cart at the last minute as an impulse buy. Even though you didn't go into the store planning on buying a 3-pack of ChapStick, it seems like a good idea in the moment, so you do.

Holiday giving can be like that. You receive dozens of letters and emails asking you to support all kinds of causes, and the folks sending out the letters and email are hoping that when you open their message, even though you weren't planning on it, something will tug at your heartstrings in that moment, and you will write a check, or click a PayPal button.

Instead, she suggests people create a plan and follow it through. Check out the full post for more specific advice on how to do just that.

Update #6: Sharon Schneider - The Philanthropic Family
My friend Sharon writes an incredible post about this year how you evaluated yourself and follow through on your philanthropic commitment. I could not agree with her more that people are increasingly finding joy in building an "integrated life" where their buying habits, careers, and charitable activities are all aligned with their values.  "The new philanthropist is anyone who strives to live all aspects of his or her life informed by the same values that inform that person’s charitable giving." Read the full post here.

Update #7: Sean Stannard-Stockton - Tactical Philanthropy
Veteran philanthropy blogger rockstar Sean Stannard-Stockton suggests some really important common sense questions for any one's personal due diligence. Importantly, he suggests that people figure out which other nonprofits are working on the same issues, and ask why their intended recipient is the best to invest in.

"All good nonprofits should be able to offer a good pitch for why they have an attractive strategy for affecting their cause. So the second question you need to ask focuses on what makes this nonprofit different. For instance, both the Greenpeace and the Environmental Defense Fund focus on the cause of protecting the environment. But while the Environmental Defense Fund seeks market-based solutions and partners with corporations, Greenpeace works towards “exposing the dirty secrets of corporate polluters like Exxon” and organizes protests. By asking a couple of nonprofits working on a given cause how they are different from each other, you will begin to figure out which nonprofit you want to support."