Willful Blindness – What are We Overlooking When it comes to Charity Effectiveness?

I read a lot.  Not as much as some, but I think more than the average.  Some of the books that I have found most thought provoking or I have referenced in other blog posts can be found on the Dexterity Consulting Bookshelf.  You can even order them straight through the site!  Oh the power of Amazon.

But I digress...

I am currently in the midst of reading Willful Blindness by Margaret Heffernan.  The premise is that, just like in the movie Fog of War, we only see what we want to see and we justify overlooking the obvious when it flies in the face of ego and our ideology.  A few years ago, I read a similar book – Mistakes were Made but Not by Me.  Same idea, that government leadership will accept culpability but only to the point where the errors can be diffused amongst many.

We do the same thing with charities.  We assume from the outset, that because the organization is charitable in nature, they are operating at a higher standard.  Why is this?  Are the humans that run charities any more altruistic than the average human?  Is there a psyche that instills a greater sense of honesty and trust than someone who’s more inclined to run a business?  What is it that allows us to donate funds to organizations without asking questions? 

Each year the CRA de-lists over 2,000 charities.  The reasons for de-listing range from:

• Charities self-selecting to close
• Lack of filing their tax returns or
• Donation/Financial mismanagement 

This may seem like a lot, but if you think that there are ~85,000 charities in Canada and this number is growing, this doesn’t seem like a high number at all.

So, I want to explore this question.  What are the triggers that can indicate when a charity is at risk for losing their status? How do we find them? Who should be obligated to find them? Is it the role of the advisor? The charity? The Government? What happens when the regulator, is also the judge and jury? Who represents the interests of the client? The donor?

Each year $112B flows through Canada’s charitable sector by way of salaries, program related expenses, contracts with vendors (like Xerox, IBM and Grand & Toy, etc.), rental agreements and capital purchases, utilities, special events, marketing/PR/communications, web/internet... You can see where I am going with this.  The Charitable Sector is big business.

In addition to the money flowing into and out of the charitable sector, there is also the value of the volunteer time that is generated within the organizations.  According to one national survey, volunteering in Canada translates to 1.1Million full-time equivalent jobs (2009 Stats Can)! 

Who are these volunteers?

**Please note, the following does not speak to motivations**

Volunteers are found in three places – outside of the charity, mandated by their employer, and inside the charity.  Outside volunteers: people who do not work directly for the organization in which they are volunteering.  Mandated volunteers: Individuals and groups that are required, by their corporate employee, to “get involved” via corporate volunteering program or something similar.  Inside volunteers: people who work within the charity who, by the nature of the organization running a lean operation, are “required” to do some “volunteer” work for their employer. 

The latter example is one that I recently encountered with a client organization. An employee shared with me that she has over six weeks paid leave owed to her because of her “volunteer” time she has put into the charity that employs her.  The reason – they can’t afford to hire someone else, and they have not been able to successfully recruit a volunteer to take on some of the tasks.

When I worked for the Jewish community in Whippany, NJ, there was an expectation that we would not only put in our time managing the fundraising campaign that we were hired to do, but also to attend special events, support other departments and their events, attend community functions and otherwise be available for our donors and volunteers when they needed us available.  While the organization ran a multi-million dollar campaign, their staff hours did not adequately reflect the real costs of running the campaign because so much time was attributed to “volunteering.”

How should we go about looking at this very complex problem of charity information and donor willful blindness?

Over the next 12 months (or so) we will be exploring different ways that charities communicate and donors evaluate organizations.  The idea – shift the dialogue towards one of discovery and evaluation, and away from blind faith and social assumptions.  Our job is not to determine whether a charity is good or bad, rather it is to provide opportunities for donors and charities to have more meaningful conversations with each other about the work that is being done.

Contest #1 - the Dexterity Consulting marketing team (Arleigh, Meghan and Karine) in conjunction with Place2Give Project Manager, Rachael Parmar, came up with a contest working with Zinc Research.  Canadian charities are encouraged to upload their past two year’s annual reports into Place2Give.  The idea – do charities that have “fancy” annual reports raise more money than organizations that don’t.  In order to keep the playing field even, we will be comparing organizations by operating budget size and sub-sector (this way, as an example, medical research organizations won’t be compared with grass-roots medical support agencies).

In order to sweeten the pot, Dexterity Ventures Inc. will be awarding a charity that has uploaded their annual report (drawn at random), $500.  As with all of the P2G contests we have run, we will be Tweeting out the organizations that upload their information and linking to them from our Place2Give and Dexterity Consulting Facebook pages.

What are your ideas for contests that improve the dialogue between charities and donors?  Your suggestions are welcomed and we will try to integrate them.    Please share them on this blog, our Facebook pages or Tweet us.