Best and Worst Charities... The #GivingTuesday Conundrum

In today's Seth Godin blog - Babies and Bath Water, he lists the organizations that he is supporting for GivingTuesday and also links to the "worst" charities.  

What makes a worst charity? 

I am attending the Nexus Summit in Washington, DC and this question came up yesterday in the session on philanthropy and innovation.  It was apparent that what people defined as worst was very subjective.  And some of the people in the room are seasoned, philanthropists and social impact investors.  

Let's break it down by looking at the language associated with the question.

A "worst charity" could mean:

  • High risk in the proposed solution without the capacity to deliver
  • Track-record of limited or no success in addressing the mandated problem
  • High staff turn-over 
  • High fundraising costs
  • High program implementation costs
  • Long timeline for execution
  • Inconsistent or lack of diversified funding
  • Limited partners
  • Overhead unclearly communicated
  • Conflict of interest between board and management
  • Delayed reporting to government bodies

Can we talk about risky investments in charities if the market doesn't de-risk the investment by virtue of charities closing for not successfully addressing their mandate?

How charities come into existence is time-consuming but they are not based on whether the geography or issues is over saturated.  Government bodies, both in Canada and the US, do not conduct market research to understand the landscape, nor do they encourage charities to this.  Ultimately, it is up to the donor to understand who all the players are and where along the continuum of care the agencies fall.

Today is GivingTuesday and we have put together a list of charities that we think are sound investments based on the following criteria:

  • Governance
  • Community Relations
  • Program Implementation
  • HR/Admin/Volunteerism
  • Fundraising
  • Financial Management

There are 20 organizations listed so that wherever you sit personally on the "risk spectrum" and wherever you are in the country, there is a charity for you.

Thank you for supporting charities in your community.