Why donating to Japan can do good
By Larry Probus, the CFO of World Vision, U.S. The opinions expressed are his own.
Felix Salmon‚Äôs blog, ‚ÄúDon‚Äôt donate money to Japan,‚ÄĚ appears to make a compelling argument for not donating to charities responding to the tragic earthquake and tsunami in Japan. Salmon says, ‚ÄúEarmarking funds is a really good way of hobbling relief organizations and ensuring that they have to leave large piles of money unspent in one place while facing urgent needs in other place.‚ÄĚ
There is an element of truth to this argument, but as often is the case, simple answers to complex questions are usually wrong.
As the chief financial officer of the U.S. offices of World Vision, the international Christian humanitarian organization, I can appreciate Salmon‚Äôs complaints about earmarked donations enabling ‚Äúa mess of uncoordinated NGOs parachuting in to emergency areas with lots of good intentions.‚ÄĚ But rather than encouraging “business as usual” levels of giving, our response should be to ensure life-saving relief efforts are coordinated and effective.
NGOs need both designated and undesignated funds to be successful. Designated donations provide charities with discipline and discernment to perform the work they promise donors they will do ‚Äď whether emergency relief operations or long-term community development. Moreover, donors can ‚Äď and should ‚Äď hold their charities of choice accountable and expect to be informed about how their designated contributions were used.
On the other hand, no charity could survive if all its donations were earmarked for specific programs. How could overhead be covered? I‚Äôve yet to meet a donor whose passion is paying the office‚Äôs electric bills, let alone the costs of fundraising. My experience in both the corporate and non-profit sectors has enabled me to scrutinize expenditures for administrative functions, either for the benefit of stockholders, or targeting more money for programs serving the poor.
I do agree with Salmon that designated donations can leave some NGOs unable to address the ‚Äúless visible emergencies,‚ÄĚ such as some of those 22,000 children who die every day from mostly preventable causes, or the 1,000 children who are infected every day with HIV. Those crises do not merit ‚Äúwall-to-wall coverage‚ÄĚ for several consecutive days on CNN or the BBC, enabling millions of people‚Äôs hearts to be touched and wallets to be opened. But they are no less important, nor less urgent, than the four-month-old infant rescue workers pulled from the rubble March 15th in Japan.
The fundamental issue with charitable giving is trust. If donors are wary of a charity‚Äôs claims — either in the midst of a major natural disaster, as we have seen in Japan, or in conducting long-term community development — they should keep their money. But if donors do their homework, consult watchdog groups, such as Charity Navigator or Better Business Alliance, and develop a comfortable level of trust that the organizations will be effective stewards of their contributions, then I would gladly echo Salmon‚Äôs admonition: ‚ÄúSo do give money to them ‚ÄĒ and give generously!‚ÄĚ
Photos, top to bottom: Survivors walk through a flooded street searching for their belongings at high tide, in the destroyed residential area of Kesennuma, Miyagi Prefecture, more than a week after the town was devastated by a magnitude 9.0 earthquake and tsunami March 19, 2011. REUTERS/Damir Sagolj; People ride bicycles amidst debris of buildings wrecked by last week’s earthquake and tsunami in Natori City, Miyagi Prefecture, northeastern Japan March 20, 2011. REUTERS/Yegor Trubnikov