February 12th, 2019
My entry into the philanthropic sector was, I expect, similar to that of many of our colleagues. Following some years working with ngos, an opportunity arose to work with a philanthropic organisation, and my experience as a grant-seeker was considered to equip me to be a grant-maker.
Occasionally this was described as ‘going from poacher to gamekeeper’, which, if a little unfair, does recognize some of the tensions in the grantmaking role. While the grantmaking role should not avoid the distribution of largesse the way a gamekeeper is expected to do, it certainly does require that decisions be made about who should receive funds that will disappoint many worthy applicants, and, perhaps more importantly, that will prioritise some ngo work over others.
It was largely the inherent challenge this task had confronted me with for many years that led me, around 2002, to establish the Centre for Social Impact (formally the Asia-Pacific Centre for Philanthropy and Social Investment) at Swinburne University. The Centre’s purpose was to recognize that decisions about investing for social good are no less important and quite possibly more difficult than those about investing for financial return, and to offer professional development opportunities for the philanthropic sector like those offered by the MBAs and the like that abound in the business world.
At that time, and more so now, there was an abundance of resources available, albeit mainly from outside Australia, on encouraging and administering grantmaking, and on the virtue and personal gratifications, and societal benefit, of such activity. Over that time, too, there was a dramatic acceleration in the realisation that it is outcome, rather than output, that is the real measure of philanthropic effectiveness, and of resources to assist in the assessment of impact.
However, far fewer resources, and far less discussion, were to be found on what I believe remains the central challenge in grantmaking - the rigorous and objective determination of the causes, and then the organisations and programs, that most require support. Since then, encouragingly, this has changed - which leads me to be a little dismayed that this question is still somewhat on the margins of discussion in our sector, and that the leading resources in this field are somewhat underutilised.
The formulation that has come to be regarded as best describing this challenge is ‘Effective Altruism’, and in the USA and the UK, and to a lesser extent in Australia, a handful of organisations have emerged that are doing truly powerful and demanding work in this area.
Effective altruism uses evidence and reasoning to determine the most effective ways to benefit others. Effective altruism encourages individuals to consider all causes and actions and to act in the way that brings about the greatest positive impact, based upon their value. Effective altruism differs from other philanthropic practices because of its emphasis on quantitatively comparing charitable causes and interventions with the goal of maximizing certain human values, especially the saving of lives, and protecting humanity from existential threats, now and in the future. In this way it is similar to consequentialism, or utilitarianism, which some leaders of the movement explicitly endorse. It is the unwavering commitment to a broad, evidence-based approach that distinguishes effective altruism from traditional altruism or charity. Effective altruists reject the view that some lives are intrinsically more valuable than others. For example, they believe that a person in a developing country has equal value to a person in one's own community.
Wikipedia defines Effective Altruism as; ‘answering one simple question: how can we use our resources to help others the most? Rather than just doing what feels right, we use evidence and careful analysis to find the very best causes to work on.’
The idea of effective altruism is, while powerful and, to me at least, persuasive, is of course not without its own challenges;
Nevertheless it is because I find the underlying philosophy of effective altruism so persuasive and so central to good grant-making and social investment, and the analysis undertaken by its adherents so honest, comprehensive and explicit, that I believe it is an approach that deserves far more attention by the wider philanthropic sector, notwithstanding - indeed because of - the difficulty of the questions it refuses to shirk.
Though there are relatively few websites that focus on effective altruism, the richness and density of their analysis makes them, in my view, essential reference points for any serious grant-making, especially where real discretion in the choice of recipient, and therefore judgement, is required, and the amount of funds is meaningful.
The following lists a few of the leading such organisations but is in no way comprehensive:
The Centre for Effective Altruism at Oxford is arguably the best starting point. As well as explaining the key ideas, it contains detailed papers on analysing effectiveness, and for those who are willing to be guided in their decisions, some recommendations as to charities to fund, especially in developing countries.
Several other entities have been incubated by the Centre, including the very novel 80,000 Hours, which recognises that far more people have an opportunity to shape their career around worthwhile purposes than have the wealth to be significant philanthropists (hence the 80,000 Hours), but then employs effective altruism ideas, and draws on sophisticated research, to advise on possible career directions.
USA-based Givewell is a charity evaluator, but one that differs from most of the others by evaluating on the basis of performance and impact, using measures of lives saved or improved per $, as well financial performance, overheads, etc. Givewell investigates and assesses charities, recommending a few but also publishing reports containing summary conclusions such as ‘limited evidence of effectiveness’ or ‘lack of room for more funding’. Givewell also identifies and reports on fields of possible intervention (such as trachoma control).
Australia has a few organisations operating on the same principles but at a less developed level.
Effective Altruism Australia promotes the same principles, but with limited resources is mainly a platform enabling donors to support a number of charities, largely similar to, and based on, those recommended by Givewell in the USA.
Changepath rates Australian charities on financials and transparency, based mainly on ACNC data and Annual Reports. It deserves to be more widely used than I suspect it is, especially by household donors who are entitled to know if the finds being solicited are needed. It does not claim to assess impact in the way Givewell does.
One of the characteristics of the Effective Altruism community that I find particularly commendable is that, in keeping with the commitment to disinterested evaluation, there is an explicit willingness among its members to evaluate their own performance, audit their own value-for-money, and admit their own mistakes. Both the Centre for Effective Altruism and 80,000 Hours have a section headed ‘Mistakes’ on their portal.
This post is intended as an introduction to the notion of effective altruism and to some of the resources and discussions on it. The issues encompassed here go to the core of the craft of grant-making, and the underlying head/heart tension which is both the inevitable challenge and the great reward of philanthropy. I hope to delve further into some of the issues explored by the effective altruism community in future posts. Comments and responses please!