It’s mid-May, students are graduating and many people are making plans for the summer. In fact, it’s a great time to start preparing your summer reading list and I’d like to recommend It Ain’t What You Give, It’s The Way That You Give It by Caroline Fiennes, a donor advisor and the Director of Giving Evidence, based in the U.K. The book, released in March 2012, is available from www.giving-evidence.com/book.
I’m also pleased to share my interview with the author, as she discusses issues in philanthropy such as why giving based on overhead/admin costs is “bollocks”, the value of systemic impact, and selection bias in evaluation—while also covering things such as her passion for medieval choral music, thoughts on gender imbalance at the World Economic Forum, and what economists can learn from high impact philanthropy.
Are you concerned that readers will read the book’s “10-Minute Guide to Supporting Charities” and assume they don’t need to read the rest of the book?
Fiennes: No. It’s rather the other way round: I know that lots of people only read the first few pages of a book (they’re waiting for somebody in a bookshop, they find it on a friend’s kitchen table etc.) and since I’m keen that even they get the key messages, I put them upfront in the 10-minute guide. There is of course loads more detail in the rest of the book, as well are more stories and jokes.
You make an important distinction between effectiveness (improving the world) and efficiency (lack of waste). Do you think these terms are overused or misused by both donors and organizations?
Fiennes: Yeah, I think that people focus too much on lack of waste (and they conflate “admin” or “overheads” with waste, when actually it’s often totally different), and not enough on what the charity actually achieves: its “effectiveness”, or what an economist might call its productivity.
I’m really angered when I see charities flaunting the low-ness of their admin costs (as WaterAid did) because it feeds the notion that admin = waste and should be minimised: and
- (a) that’s bollocks, and
- (b) it’s dangerous bollocks because converse is true, and
- (c) therefore most charities spend their lives trying to disabuse donors of this dangerous notion.
Of course, reducing waste is important. Of course. But it is impossible to see waste from outside an organisation, so we should never encourage donors to try, and it anyway doesn’t tell you much: a charity with a terrible theory of change, or doing something which doesn’t need to be done, but with no waste isn’t going to do a good job.
In reference to breadth vs. certainty, you encourage donors to support work that has a high risk of failure but has the greatest capacity for impact. Is there a certain donor profile you’re thinking of for this type of support? For example, a high net worth individual, giving circle, foundation, corporate philanthropy, large service organization, all of the above?
Fiennes: Not particularly. I’ve explained this to people who give £millions and people who give £10—companies and individuals—and they’ve all understood it and liked it. People giving at any scale can understand the value in systemic impact.
For instance, Obama’s Presidential campaign was financed in large part by regular “retail” donors giving a few dollars: without needing to take sides on his presidency, you can see that changing the president is quite a “bottom of the triangle” way to change a nation, and loads of regular people responded.
The triangle is relevant to any donor because they all need to be aware of their options, and the choices they’re making. Same reason I explain what theories of change are.
It also speaks to the point above about waste, actually. People sometimes think that spending on advertising is “waste”. But in the case of charities of charities advertising to get people to avoid getting skin cancer, or to be more aware of the needs of disabled people (or a million other virtuous examples), that isn’t waste at all. It’s an effective intervention.
What type of market (or other) research did you perform before or during the writing of this book? Did you learn anything particularly surprising or were certain long-held theories or beliefs merely confirmed?
Fiennes: Ha ha. Well, I have worked advising donors and funders for years, and been a charity CEO, so I started out thinking that I knew this stuff and would just write it down. Through my research—which comprised talking to lots of people, and reading quite a lot—I learnt absolutely masses.
Two of the three main influences on this book were people/disciplines I’d never encountered when I started writing: one is Professor Dean Karlan (Innovations for Poverty Action-IPA, MIT’s Poverty Action Lab J-PAL) the whole “movement” to bring scientific, randomised evaluations into development work; and the other was Dr. Ben Goldacre, through whose book about medicine I learnt masses about social science research and where data collection goes wrong (e.g., selection bias, confirmation bias, publication bias). Those areas are obviously related—in fact, Dean, Ben and I had dinner together. In terms of rigorous assessment of the effectiveness of various ways of “doing things to other people”, medicine is way out front, the international development are learning and doing a lot, but the domestic charity sector is at the back.
I’m now genuinely shocked that I thought I was an expert in this stuff and didn’t even know about selection bias—which renders many “evaluations” totally useless. But there are lots of other people in the charity world who also claim to be experts in evaluation/impact who don’t understand it—and that is shocking. Even Goldman Sachs doesn’t seem to understand it.
Completely unrelated to philanthropy: What kind of music are you into these days?
Fiennes: One of my big passions is medieval choral music(!) My husband went away for two months last year, and I bought the complete works of Thomas Tallis and sat down to write! Tallis is even thanked in the acknowledgements, and there’s a reference to cathedral music in the book somewhere.
And my weird attachment to (cheesy 1980s popband) Starship has recently been rekindled, courtesy of the Muppets movie!
There was an interesting Economist article, Mick Jagger’s Davos Top Ten, on last year’s World Economic Forum in Davos at which Mick Jagger was the hot celebrity guest. The article’s author, Matthew Bishop, plays on the Rolling Stones tune “Some Girls” as a commentary on the gender imbalance at the conference. Do you have plans to break into the World Economic Forum or have you already?
Fiennes: I have not been, though would be happy to. Gender is an issue: I remember the Chair of an endowed UK foundation noting that “the trustees are all men in their 50s onwards, but the staff are all women in their 20s and 30s.” Actually, that’s not so much gender itself as the fact that many boards want trustees with significant business experience, which is a skew against women. (See, that’s selection bias right there! It’s everywhere, honestly.)
What do you think is the most important thing that economists can learn from those of us working on the impact of philanthropy?
Fiennes: I’d like to see much more sophistication in the debate about impact, for which we clearly need people from many disciplines. The philanthro-sector can learn much from economists: it’s not by accident that the rigorous evaluations in development are done by people called “development economists”.
The challenge to economists obviously is that much of what the social sector does isn’t readily quantified / isn’t at all relevant to price / comes in non-interchangeable units (e.g., education advances & cultural deepening) / occurs over a range of timescales.
And we can learn much from medicine and the physical sciences as I’ve mentioned.
Anything you’d like to add?
Fiennes: As BBC Children in Need—a large & progressive UK grant-maker—were kind enough to write on the cover, this is “the book which charities want donors to read” because it explains the importance of all the things we always ask: unrestricted, long-term giving with help but not meddling etc. So many charities are recommending it to their donors.
I’ve had people question the book, disbelieving that donors will really do what I’m asking. To which I’d respond with two observations. One is that donors will do this: I was this morning with a donor I’m advising who, having read it, is doing only unrestricted grants of $00,000s for several years, has ceased looking at admin costs, and is now more than happy to pay for evaluations alongside. And the other is the stream of people who write to me saying things like “I had no idea that this was in the public domain”, or “I’m totally changing my giving now”.
Read more about It Ain’t What You Give, It’s the Way That You Give It at www.giving-evidence.com/book.