5 Ways You Can Be a Smarter Giver This Holiday Season
Between Thanksgiving and Christmas, charities around the world work doubly hard to put their best foot forward. Fundraising campaigns designed to tug at the heartstrings are launched as they make their presence felt to their donors and reach out to the public at large in the hopes of gaining new patrons.
Why? Because apart from when calamities strike, past figures show that this four-week window is the time when wallets open up as individual donors become more generous to share their blessings. Maybe it’s the gifts that start coming, or the carols being sung everywhere. Whatever it is, a charity’s plea for help has a much better chance of getting a positive response.
Let’s say you find yourself in a giving mood and are willing to make a sizeable donation that can make a modest impact. Do you write a check to the first non-government organization (NGO) that comes knocking?
As of December 2017, there are nearly 200,000 non-stock corporations listed with the Securities and Exchange Commission (SEC). That’s a lot of charities you can choose from, and also many potential mistakes if you don’t know how to navigate the non-profit waters.
Is there a foolproof way to choose the right charity? After all, you are making an investment – a philanthropic one – and deserve to know that your money will be spent wisely. While nothing is ever risk-free, here are five things you can do to keep that margin of error very very small.
1. Shop before you commit
Start by writing down advocacies that have a personal meaning to you. It could be education, or feeding programs, or medical missions, or creating livelihood opportunities, even climate change. When you pick one, say education, you can still narrow this down to early education or vocational training or college scholarships.
Dr. Harvey Carpio, executive director of Childhope Philippines, advises that you choose a charity you feel you can support beyond a one-time donation. “Giving is a commitment, so it must be an advocacy that you feel strongly for, say education for poor children or social welfare for the homeless.”
Once you choose an advocacy or two, check with friends if they know of any charities that work toward these causes. You can also browse online and look at options. Remember the 200,000 registered NGOs? That’s a lot of choices so get busy.
2. Ask before you give
When you have narrowed down potential charities, make sure to do your checks before you write any checks. According to Carpio, every potential donor should ask this important question before supporting a charitable project: “Does the project address an unmet need? With the multitudes of charitable institutions proposing to address a social issue or community problem, it is best to examine closely if they offer a concrete solution to a problem that really exists and needs to be solved.”
Childhope Philippines, established in 1989, champions the cause of children who work and live on the streets. In many cases, that includes extending help to the parents so that the families can get back on their feet.
Rafael Cojuangco Lopa, a social development veteran with 30-year experience, agrees and adds that donors ask what are the desired outcomes for the beneficiaries. “Outcomes must be measurable so that donors can assess the cost-benefit ratio of their giving.”
3. Vet with the experts
In the U.S. and U.K., there are non-profits that rate the non-profits. The Charity Navigator, the GuideStar and the Give.org are some of the trusted resources donors can go to so they avoid getting scammed (sadly, even the non-profit world has them).
Here in the Philippines, Lopa suggested the Philippine Council for NGO Certification (PCNC). “This is an organization that assesses the legitimacy and the capacity of NGOs to properly implement their programs which in turn becomes the basis for an NGOs eligibility for tax exemption. This organization is legally recognized by the Bureau of Internal Revenue as their partner in assessing NGO applications for tax exemption.”
Lopa currently serves as president of the Ninoy and Cory Aquino Foundation and was previously chair of Microventures Inc., executive director of the Philippine Business for Social Progress (PBSP), and trustee of PinoyME Foundation and ASA Philippines Foundation. In wearing all these hats, he has been exposed to the full spectrum of the non-profit universe from local community organizing to business development to research and training to multi-stakeholder engagements.
Other than PCNC, Lopa also named other organizations that serve as umbrella organizations of NGOs and foundations. You can look at their roster of members as part of your vetting process. One of them is the PBSP and the others are the Association of Foundations, the League of Corporate Foundations, the Philippine Business for Education, and the Philippine Business for the Environment.
4. Watch out for red flags
“Track record is always an important consideration,” Lopa says. “Donors must always ask what the organization has already done, how long they have been doing it, and more importantly whether they have evidence of impact. Related to this, donors might wish to do background checks on who are the founders and the people behind the management of the organization.”
Carpio also recommends asking for supporting documents to ensure that the charitable institution is legitimate. “NGOs were the topic of controversy when the whole PDAF or Priority Development Assistance Fund scandal broke out. As a potential donor, you have to make sure that the money you are giving will go to legitimate charities. Ask for their registration, licenses and accreditation certificates from governing agencies including the SEC, PCNC and the Department of Social Welfare and Development (DWSD). Ask for a fundraising permit issued by DSWD. All legitimate NGOs have these documents available for anyone who would want to see them.”
If these documents are not readily available, it should make you think otherwise. What’s more, even if these documents are presented to you, take the extra step and verify from the institutions that issued them.
“You may also opt to meet them at their headquarters so you would know that such organization really exists. Usually, they will have their business permits, certifications and accreditations on display to show the visitors that they have complied with the legal requirements. Also, always ask for an official receipt to be issued to you for your donation,” reminds Carpio.
5. Follow the money
Sick of the red tape yet? The fun is about to begin. Identified your passion? Check. Done your first, second and third round of checking? Check, check and check. Now it’s time to bring out the checkbook, or yourself.
Before you handover the check, ask for two things: how much of the money will be spent to the beneficiaries and when you can receive a report to monitor progress.
NGOs also have overhead expenses, but as a donor, it is in your money’s best interest that bulk of the donations go to beneficiaries and not to administrative expenses. While NGOs understandably need offices to conduct business, it does not have to be in a high-rise in the central business district. Probe as well on salaries paid to NGO officers.
“Donors must always demand reports. But it is best for donors to actually physically visit the projects, personally meet the people involved in the project and more importantly the beneficiaries of their donations,” Lopa says.
According to Lopa, do not limit yourself to giving cash. Increase your odds in making a difference with in kind donations as well as volunteer service. “I believe there is strategic value in tapping all three types. Social problems are complex. While cash donations are often the preferred form of assistance, in kind and volunteer services can actually enhance and complement the limited cash resources that are provided.”
“All NGOs need cash donations, and these are always on top of the priority list,” explains Carpio. “Mainly because it provides flexibility in addressing the most important needs of the institution. NGOs get creative when they receive in-kind donations too. For example, donations of lightly used clothes can be sold at rummage sales. Branded bags can be put up for auction. The bottomline is that we prefer to receive cash or in-kind donations that can easily be converted to cash.”
“Having said that, we do not discount the help that volunteers give through their time and service. At Childhope, we strongly encourage our donors to spend time with our street children beneficiaries so they would hear their stories themselves, and get to share their experiences and words of encouragement to them. This is very effective in creating champions and ambassadors for our cause. A lot of our current individual donors have continued to support us because they became champions of the welfare of street children after spending time with them.”
Beyond ensuring the proper use of your generous support, establishing a relationship with the people on the ground who work very hard and the beneficiaries of such hard work is priceless. Being part of a collective effort where shared compassion is the main inspiration – that’s immeasurable.
Robert Ingersoll said it well: “We rise by lifting others.”