How charity evaluators are changing the donations landscape [UK]

The Guardian, June 11, 2013 - Charity evaluators are on the rise and those they choose to endorse can receive windfalls worth millions. Charities often ask for donations by appealing to people's hearts, not their heads. However, many large-scale donors, such as foundations and government departments, demand evidence that their money will be used well.

A new type of organisation, the charity evaluator, has started to assess voluntary sector organisations with similarly hard-headed techniques, using data and scientific research to advise individual givers where to donate. They typically recommend a handful of organisations each year rather than trying to rate lots – and those chosen can receive windfalls worth millions.

But there are drawbacks. Such recommendations, often of very small organisations, can take a lot of staff time to win, and are no guarantee of regular income. Furthermore, such charity evaluators currently focus on single-purpose organisations that work in the developing world, mostly in healthcare.

"Realistically for most charities, there is no chance of getting a GiveWell recommendation," says Alexander Berger, senior research analyst for the San Francisco-based charity evaluator, founded in 2007 by two hedge-fund staffers. Robert Wiblin, director of research for Oxford-based evaluator Giving What We Can, says it tends to choose effective healthcare interventions first, before looking for organisations that deliver them well.

Giving What We Can was founded in 2009 by Oxford academic and ethical philosopher Toby Ord, who pledged to donate £1m of his estimated £1.5m lifetime income to charities. It has more than 300 members who have pledged to donate at least 10% of their income, worth an estimated $120m (£77m) over the coming decades, and they want this money to do the greatest possible good. GiveWell, with a similar results-based approach, reckons it directed $9.57m (£6.2m) in donations in 2012, nearly double the previous year.
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