Where To Philanthropy?

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When thinking about charity and philanthropy, there is a growing assumption in our community that giving is an unalloyed good. All that is required to address our social conscience and the social need of the communities that matter to us is to increase the amount of money that is given to well articulated causes and charities. And the results will follow. Very few financial arrangements that we undertake in the rest of our lives either as investors or consumers are afforded such an assumption, or such an easy passage to further investment. In the spending in our other lives, whether it be making a new share investment or buying a new dress, there is a level at which we monitor the spending decision, much like we might do with a donation.

But in our other lives, such purchases or investments usually also involve a lot of learning, a few mistakes, and a long term process of accumulating wisdom, so we do it better next time. Hence the concern about this assumption of unalloyed good when it comes to giving. It was one of the less good side effects of the Giving Pledge (undertaken by billionaires who pledge to gift half their wealth in their lifetimes). The pledge made it sound as though philanthropy was about how much was given rather than the difference that was made with each gift.

This seems an appropriate subject for a first blog on this recently launched website for PSI Managers. I think it is worth restating that philanthropy is different to charity. Charity is about ameliorating the lives of the disadvantaged. But philanthropy can be about a lot more. It can be about solving social problems, or at least trying to, and should be about a legacy of supporting social progress. But such objects are for the most part very hard to achieve. Most of all they require patience and cumulative wisdom, and almost always require connections and partnerships with others, which is not always easy. Social progress is rarely achieved by merely spending more money on perceived problems.

Philanthropists are in a unique, unfettered, unbiased space from which they can view the whole system and the players within it, and can be highly selective and even adventurous in how they contribute. There are very few easy wins, however. To do philanthropy well, you have no choice but to be constantly sceptical. When someone gives you an evaluation of a social program that shows outstanding results, be sceptical. When someone gives you data and says I’ve measured it, it works, be sceptical.

The American social scientist James Q. Wilson said in the end all social problems boiled down to culture and ways of thinking, but to shed light on that the data is ungathered and ungatherable. For a scientist such an insight is very hard to work with, as it is for most business professionals who are used to making logical connections between objectives, inputs and outputs.

Science is unquestionably helping philanthropists spend their money more wisely. We are learning more and more about the human brain and how it operates, for example. We are learning more about complexity and how to address it. We are learning new things about network effects. We continue to learn a lot about what interventions don’t work with certain groups of people in certain settings. It is slow but it is exciting – there are certainly calculated ways of trying new things and making a contribution. There is room to be both sceptical and optimistic. In the long run, if we choose, we accumulate wisdom and do have an impact. Ultimately philanthropy will be very rewarding, but lets not confuse the journey with simplistic assumptions.

For further reading on this idea see Stanford Social Innovation Review, Winter 2015, “Known Quantity” by Achilles Kallergis and Alexandre Lambelet.