In our very last Copper post we explored the potential implications of ever-changing direct donation models in building donor accountability.
But that’s just the start of this little thought experiment…
Having imagined the diffusion of power away from the intelligent, purposeful agent (the Charity) towards the real protagonists – the donors and beneficiaries – we can see that power might then flow one of two ways.
Either power flows towards the beneficiary – to hold donors to account and help them find the best possible service provider. Or it flows to the donor, to enable them to donate in the most personally rewarding way.
The first is ideal(istic), but terribly difficult to accomplish. It takes us into complex social journeys, and innovative collaboration models (we’ll come back to it in another blog!). But the second is simpler in principle. It’s just about providing informed, personalised decision-support for donors.
Three approaches to the problem have been repeatedly tried.
The efficiency play
First, is the personal ‘efficiency’ play, delivered by simplifying donors’ financial management.
In the UK, this is symbolised by the ability to set up a dedicated, pre-paid Charity Account which you can top up and use to simplify and anonymise your philanthropy. The Charities Aid Foundation provides this sort of service. It enables regular charity givers to automatically donate their giftaid; and then automatically verify the legitimate charitable status of those that ask for money. The service remains a very niche product and has remained static at around £70m in contributions since 2008.
The pick and commit approach
The second approach has been to attempt ethical or engagement play, delivered by enabling people to ‘pick and commit to a cause’.
In the UK, Givey, for example, offers donors secure and trusted way to donate funds. But most importantly it also aspires to become a portal for donors to find causes and campaigners they may want to support through donations or fundraising. Its relatively low take-up to date is suggestive. Simultaneously, it’s also interesting to note that the best known UK brands in ‘peer-to-peer fundraising’ – VirginGiving and Justgiving – make negligible effort to actually engage, empower, influence and motivate the donor. They simply assume the donor has a charity already in mind and leave it at that.
Arguably the most ambitious ‘take’ on making the fundraising experience donor-centric is through the Blackbaud-owned offering – Everyday Hero. This service does substantially the same thing as Just Giving but is much, much more immersive.
It allows users to set goals; it simplifies their communication; and it envalues all their charitable engagements i.e. time, and communication as well as donated money. Crucially, it also integrates simply with CRM with other charity systems. Hence it’s not actually truly donor-centric. But it certainly feels that way. The US culture of philanthropy from which it originates is very different to our own rather apologetic and self-effacing UK version.
Another strong US variant, Classy, works in a very similar way to everyday hero – albeit integrated with Salesforce. However this is exclusively a back-end service, to be overbranded by charities in order to create a walled-garden of brand engagement. The opposite of radical donor-centricity.
The accountability play
The third and final ‘play’ to date is to inform donor choice based on ‘effectiveness’ or institutional accountability.
In the US, digital tools have emerged which inform donors about the operations of individual charities in a bid to develop the confidence and earn back public trust. Independent regulators such as Charity Navigator analyse, evaluate and rate charities according to their financial health, their accountability/transparency and their results reporting. Publicly available information such as tax returns, IRS forms and financial reports are collated, along with reviewing best practices and governance structures, to calculate a score out of 100. Penalty points can also be deducted, to create a ‘Donor Advisory’.
As Charity Navigator acts independently, users know that the advice on offer is impartial and can therefore make the best choices. The portal even has the functionality to facilitate donations and create aid portfolios without a middleman, guaranteeing that as per their above request, donors see as much of their donation as possible reach its cause.
A similar but more voluntary/promotional model is GuideStar – the world’s largest source of information on non-profit organisations. Unlike Charity Navigator though, charities are encouraged to sign themselves up and to join the community. This allows them to not only tell their own stories and missions, but shows they’re willing to comply with the growing desire for accountability. Given that this is a voluntary service, there have to be incentives. In the US Charities are recognised and rewarded for their participation in the scheme with badges of accreditation and access to discounted information resources through affiliates and partners. There is also a UK version with slightly less functionality.
A fourth way: Analyst services
One final variant of donor effectiveness worth noticing is GiveWell – essentially an analyst service for charities which evaluates charities impact and selects a small number of preferred charities on an annual basis.
In terms of effectiveness, neither the ranking system, nor the voluntary transparency directory, nor the analyst-type service exists in the UK at any meaningful scale today. The donor-isation of the charity ‘space’ has barely begun.
To summarise then, in none of these three door-centric categories – efficiency, engagement or effectiveness – does the UK offer donors any meaningful support.
Changing that picture would require a lasting change in UK giving culture; a significant investment in donor/supporter education; novel, resilient value-exchanges for any emergent services or market disruptors; dramatically improved user experiences and finally some great brand-building.
In our next posts we’ll explore some of the most innovative ‘plays’ now emerging to deliver on donors’ transparency needs.
Alex is a Digital Content Coordinator at Copper