After a recent call to wallets by the American Red Cross (donation ask here, story here) I wondered, where does my money go? Is my donation being used effectively?
I’m not the only one asking these questions. In 2007, Holden Karnofsky and Elie Hassenfeld, both in their late 20’s, discouraged by the lack of transparency in charitable giving founded GiveWell. GiveWell studies charities, evaluates them publicly, ranks them on their effectiveness, and provides grants to those they believe are doing the best jobs.
Mr. Karnofsky and Mr. Hassenfeld are former hedge fund analysts who are familiar with asking tough questions. Their research for GiveWell found that many of the charities they contacted were unable to provide reliable, neutral evidence that their programs actually worked. Surprisingly, Mr. Karnofsky and Mr. Hassenfeld have encountered some resistance while asking these tough questions.
In the age of information and with the clear lack of accountability in today’s markets, it’s amazing that the need for GiveWell hasn’t been heralded as the next big thing in the non-profit sector. Increasing accountability and transparency will increase donor confidence which will ultimately increase donor participation. You can read more about GiveWell on their website or blog.
I’ve personally reached out to Mr. Karnofsky and Mr. Hassenfeld and hope they comment back. Heck, I’ve even invited them to the salsa event on Wednesday, February 13th.
photo_credit_Judith Pszenica for The New York Times