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Efficiency
Ratings vs. Effectiveness
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On the whole, ratings are a good thing. But when choosing charities to which
you're going to donate money, be aware that the efficiency
ratings assigned to charities by watchdog groups can be misleading.
More important is
a charity's effectiveness in getting aid to victims.
For example, Charity A
may dedicate 95% of received donations to direct material
aid and only 5% to administration and fundraising, which is
supposedly a good
efficiency rating. But a good efficiency rating means
nothing if 5% isn't enough money to get the other 95% to
victims where and when they need it. The 95% has to be
not only raised to begin with, but properly
administered, properly managed. Otherwise it simply sits in
Charity A's bank account, perhaps collecting interest, but
definitely not providing water, food, medicine, clothing,
shelter, counselling, and other aid to the victims,
immediately and directly.
Charity B, on the other
hand, may dedicate 20% of your donation to administration
and fundraising,
but that 20% may very well be competently, efficiently
providing the other 80% of your donation to victims within
a day after you've given it, or even within hours, in the
form of water, food, medicine, clothing, shelter,
counselling, and other aid. Charity B's so-called
efficiency rating by a watchdog group may not be as
good as Charity A's, but Charity B is a much more
effective provider of aid. And, arguably, the more
effective an aid group is, the more efficient it
actually is, too, watchdog ratings and their definitions notwithstanding.
Take Oxfam, for example
(with which we have no affiliation, by the way). You
may look at efficiency ratings for Oxfam and scratch your
head skeptically. Yet Oxfam is clearly and provably
among the best relief-and-recovery aid organizations in
the world, and it has been for decades.
Therefore, don't
automatically dismiss charities because their so-called
efficiency ratings don't appear as good as others'. Judge
them also by their histories, reputations, and overall
effectiveness. Finding out what's an effective, reputable
charity is homework quickly and easily done. There are an
awful lot of terrific aid organizations doing
wonderful and effective work even though they don't meet
the standards of what Watchdog Agency X or Watchdog
Organization Y considers efficient.
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