Is the charity sector really failing us?

Every so often a think piece comes along that seems to drive huge amounts of discussion and, let’s be honest, hand-wringing amongst those of us who work in the sector. A few months ago it was Dan Pallotta’s TED Talk, The Way We Think About Charity Is Dead Wrong, which argued that charities need to be more businesslike. This month’s candid assessment of everything-that-is-wrong-with-charity-but-you-were-too-afraid-to-talk-about is from Peter Buffett, Chairman of the NoVo Foundation and son of Warren Buffett (aka the Sage of Omaha and architect of The Giving Pledge). And it’s at the opposite end of the spectrum to uber-fundraiser Pallotta.

Peter Buffett’s thinkpiece – provocatively titled The Charitable-Industrial Complex – is well worth a read. It argues that donors engage in ‘philanthropic colonialism’, where giving is a vanity exercise where even well-meaning results in doing more harm than good. The example of Toms Shoes – a buy one, give one model – is a real world example. And his complaint is that the philanthropy of the wealthy is simply trying to solve with the philanthropic left hand the problems that the capitalist right hand has created. Buffett argues that we need to change the system, that we need humanism, not metrics. And he doubts charity is the way to do it: ‘But no “charitable” (I hate that word) intervention can solve any of these issues. It can only kick the can down the road.’

These are not new criticisms. Indeed, I’ve read more nuanced critiques: in The Revolution Will Not Be Funded, the idea of a ‘non-profit-industrial complex’ is developed much further, with particular focus on how charity dampens radicalism and further marginalises the communities most excluded. Even social justice philanthropy, which explicitly tries to address those most marginalised, has been described as an oxymoron, people getting credit for giving back what their ancestors should never have taken in the first place’. And in the UK, the Fabians have long been critical of charity, an issue Stuart Etherington covered in his Attlee lecture last year.

Beyond the charitable-industrial complex

Is such critique valid? In some respects, yes. We would be foolish to ignore charges that philanthropy is motivated by ego rather than altruism, by instinct rather than evidence. It would be foolish to ignore the charge that charity is the plaything of the few rather than the responsibility of the many. It’s why there has been so much focus in recent years on planning for and demonstrating impact. It’s why we should pursue the idea of a democracy of giving, rather than simply chasing the donors that lift our fundraising Return on Investment. And it’s why we should remind ourselves every day that charity is about public benefit, not private gain.

But is Buffett’s critique overdone? I think so. Charity achieves much. Have a look at its greatest hits. And there is more to come: what if the Gates Foundation eradicates polio? And in response to Buffett’s call for more humanism, nothing humanises more than the act of giving.

I wrote last week that we don’t want a voluntary sector preserved in aspic. Buffett’s critique in essence argues for change. So, how do we move beyond the charitable-industrial complex? Whilst I don’t like the description, it’s a challenge worth considering as NCVO looks to its strategy for the next five years. I don’t have all – or even some- of the answers. But it seems to me that a starting point for donors, wealthy and otherwise, is a greater focus on voice and advocacy: funding the day to day unheralded, difficult-to-measure policy, research and campaigning work that attempts to change the system.

For Mark Rosenman of Caring to Change, the solution lies in grantmaking practice: and in particular, the need for grantmakers to better reflect the communities that are most in need of their help. This implies taking account of diversity, power and class in grantmaking strategy.

We also need to, as a philanthropic ecosystem, make sure that charitable resources are going to where they are most needed, not to where they are most asked for. This implies a much better use of data – on need, on spending. And whilst it might seem de rigueur to mention this in every speech, blog or article about the sector, we need a relentless focus on impact: being clear about the changes we want to see and applying our resources to where we can make the biggest difference.

All of these actions are disruptive, uncomfortable, difficult. Which sounds as good as any reason to try them.

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Karl Wilding served as NCVO's chief executive from September 2019 to February 2021.

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