Note: Before the launch of the Open Philanthropy Project Blog, this post appeared on the GiveWell Blog. Uses of “we” and “our” in the below post may refer to the Open Philanthropy Project or to GiveWell as an organization. Additional comments may be available at the original post.
The approach that GiveWell took from 2007-2011 had two crucial qualities:
- We have been passive. That is, we have focused on finding the best existing organizations and supporting them with no-strings-attached donations, rather than a more “active” approach of designing our own strategy, treating charities as partners in carrying out this strategy, and restricting donations accordingly.
- We have sought proven cost-effective giving opportunities. That is, we have looked for situations where a donor can be reasonably confident - based on empirical evidence - that his/her donation will result in lives being changed for the better, at a high rate of “expected good accomplished per dollar spent.”
This year, we have been experimenting with giving opportunities that lack one or both of these qualities. We previously defended our shift in this direction; this post gives more context on the history that has led us to this point and discusses why we don’t think we can retain both of the qualities above and continue to find great giving opportunities at an acceptable rate. A future post will go into some of the questions we are addressing as we begin to shift our approach.
In our first year, we took an approach that was highly passive and highly focused on proven cost-effective interventions. We invited grant applications from a wide variety of nonprofits, and we didn’t attempt to focus on any particular strategies for helping people; we emphasized only that we wished to see a convincing case for proven, cost-effective, scalable impact, and we picked recommended charities accordingly. (See our first-round application linked from our overview of applications we received for our 2007-2008 research process.)
At that point we weren’t sure what to expect; what we found was that much of the most convincing evidence for effectiveness was at the “intervention level” rather than the “charity level” (i.e., there are programs, such as distribution of insecticide-treated nets, that have strong publicly available evidence bases, and few charities whose in-house evidence seems to add much to the case). Accordingly, for our 2008-2009 process, we did substantial independent review of research on aid interventions, and published a list of “priority programs” with strong evidence bases. This was a step in the direction of being less “passive”: doing our own independent analysis to determine what sorts of charities were most promising, rather than simply asking charities to make their own case.
In 2011, we announced an intensifying focus on deeply examining the best charities we could find (rather than evaluating charities by the standards of their issue areas). The research process that followed (leading up to our 2011 recommendations) was broad and open to many different types of groups, but it was also “active” in the sense that we often deprioritized a charity after the initial phone call, based on our judgment of how likely it seemed to ultimately merit a confident recommendation. In addition to examining charities focused on what we considered to be proven interventions, we also flagged charities for having seeming “high upside” in various ways, and considered these groups for recommendations; we tried to be open to groups we could recommend even though they didn’t work on what we considered priority interventions.
Ultimately, we didn’t find any such groups promising enough, and our top charities ended up being groups focused on interventions with strong evidence bases.
At this point, we feel that
- There is a distinct set of interventions - concentrated in the area of global health and nutrition - for which there is strong and generalizable empirical evidence of cost-effective impact on saving and improving lives.
- We have made intensive efforts over the past 3+ years to find all charities that focus on these interventions. Since these interventions are frequently delivered by/through developing-world governments, it is rare to see many charities taking different approaches to a given such intervention; it is more common that for each such intervention, there are a small number of fairly large charities that work with governments to provide funding, technical assistance, etc. in delivering these interventions.
- Our current two top charities are the groups we’ve identified that both focus on such interventions (e.g., we can confidently predict that additional donations to these groups will result in more of these interventions) and demonstrate the necessary transparency such that we can perform thorough evaluations and updates.
- Therefore, we do not expect to find any more “top charities” (in the sense we’ve previously used - “charities that will use additional dollars to carry out cost-effective, proven, scalable activities with high transparency and accountability”) in the near future.
- By focusing our efforts at the project level rather than the organization level, we may be able to generate more options for donors to deliver such interventions (e.g., considering a single nutritional program implemented by UNICEF. By being open to recommending the funding of particular projects - rather than just the writing of unrestricted checks - we would be further shifting in the direction of “active funding.”
It may seem puzzling that there are relatively few charities focused on what we consider the most proven interventions. Our basic picture of the reasons for this:
- As mentioned above, there are only a small number of interventions - concentrated in the area of global health and nutrition - for which there is strong and generalizable empirical evidence of cost-effective impact on saving and improving lives. It seems that global health and nutrition are particularly amenable to meaningful data and analysis; we feel that other sectors are very far from having meaningful data on how to improve lives, perhaps due to the inherent difficulty of measurement rather than due to a failure of effort. (We’ll be writing more about this idea in the future.)
- In many cases, these interventions are generally thought to be best delivered in partnership with the government (and often many other organizations) and at large scale. Large funders (for example, government funders and major foundations), when they seek to roll out these interventions, often work directly with governments; they may pull in nonprofits for specific sorts of support (example: the rollout of ART in Botswana).
This dynamic may limit the opportunities for “entrepreneurial” charities working on these interventions (charities that start small and earn prominence through the work they do). Many of the organizations that do focus on these interventions were essentially founded with very large grants from large funders (examples: Schistosomiasis Control Initiative, GAVI).
- It is rare for a charity to be exclusively focused on one of these interventions; in fact, it is somewhat rare for a charity to be exclusively focused on any particular intervention. (For illustration, see our list of charities considered in 2009 and note how many have “highly diverse activities.”) A common theme in our conversations with charities has been that we often ask, “What would you do with more unrestricted funding?” and have trouble getting a definite answer; charities often come back with multiple possibilities, asking us which we prefer and offering to submit proposals tailored to our interests.
Our impression - both from looking at the grants of major funders and from these conversations with charities - is that charities’ agendas are often partly or fully set by major funders, and thus often reflect the diversity of the different major funders the charities work with, with smaller unrestricted donations serving as support for these diverse agendas. This dynamic makes it difficult to find groups that focus exclusively on a particular proven intervention.
Earlier in our development, we expected the nonprofit sector to look something like the for-profit sector in terms of how organizational strategies and agendas are set. That is, we expected to find that nonprofits usually set their own agendas and seek funders who will support these agendas with relatively limited stipulations and modifications. Instead, we found charities constantly asking what agenda we wanted to fund.
Perhaps this reflects one of the fundamental differences between the two sectors. For-profit investment is what we might call “accountable to profits”: the success of a for-profit investment ultimately depends on whether the company can ultimately turn a profit, and thus it depends on things like the company’s ability to win over customers. By contrast, nonprofit investment is ultimately not accountable to anyone or anything: if a funder sets a poor agenda or fails to support a good one, there are no consequences except what the funder chooses to impose on itself. Nonprofit funders thus have fewer reasons (other than self-imposed ones) to defer to others on agenda-setting and strategizing.
Bottom line: it seems to us that agendas are often set by funders, not charities; looking for charities that have their own predefined agendas limits our options; looking for charities that focus on proven interventions further limits our options; so we have few options unless we expand our scope beyond “charities focused on proven interventions.”
We could “hold out” for more giving opportunities that meet our original criteria, continuing to recommend the best charities we’ve found while waiting for other charities meeting our criteria to emerge organically (and hoping that our money moved to top charities served as an incentive for this to happen). This would be less work per year than what we’ve done so far (which has involved a lot of exploration, getting up to speed on academic literature, examining many different charities, etc.), so if we went this route we would probably either shrink GiveWell (to perform the same role with minimal resources) or further deepen our due diligence on existing top charities (e.g., perform more site visits).
We’ve also considered looking into areas such as clean water provision and surgery, where we might find giving opportunities that still fit the rubric of “passive” and “proven cost-effective,” but with less strong evidence and/or likely inferior cost-effectiveness. Though we doubt we would find giving opportunities here as strong as our top charities, there could be benefits down the line simply to having more absorptive capacity (i.e., if our money moved continues to grow, we may need more options for donors than what we currently offer.)
In our view, sticking to either of the above approaches would be leaving a lot of potential for impact on the table. We believe that we can broaden our criteria while continuing to bring a level of transparency and public critical reflection that is absent, but badly needed, in today’s nonprofit sector. We believe that this approach may lead to better giving opportunities than those we’ve found so far (even if not by the original criteria), as well as a broader influence on donors and nonprofits. In the future, we’ll be writing more about how we plan to accomplish this.