In 2011, American individuals, corporations and foundations gave an estimated $298.42 billion to charity. Americans, more than any other population in the world, give to causes around the world. Giving to international causes is especially high for first- and second-generation Americans who still have strong ties – real or sentimental – to their motherlands.
Bangladesh has a thriving civil society. Non-governmental organizations provide critical goods and services to poor populations. From educational support to water wells, NGOs impact millions of lives annually. This is the narrative that those who donate follow.
But, very rarely does anyone follow up on a more important question: What’s the return on my charity?
Some organizations are run more efficiently than others. Some organizations are better at delivering services than others. A small number of organizations lie, cheat and steal. Some break promises. Some do not keep their commitments. As the aphorism goes, one bad apple can spoil the whole bunch.
Individuals rarely have resources to investigate where their charity dollar goes. The cost of investigation is simply too high. So, individuals trust organizations. But, even well-intentioned organizations might be doing something inefficient or counterproductive.
Looking at this problem, the U.S. Department of State decided to partner with diaspora-founded NGOs and a partner with experience in philanthropy in order to create a philanthropy portal. The portal, which is now in beta, will serve as a mechanism for donors to know the value of their investment. NGOs will be regularly investigated for efficiency and value. Only NGOs that have gone through an approval process will be allowed into the portal.
By streamlining donations into one portal, donors will feel better about their investment, and NGOs may receive more dollars given that donor confidence.
Measuring is critical to how we give. In a world of limited resources, the value of every dollar has to be optimized.