Do enough donors care?

The polling company, YouGov, issued a press release last week with the heading “Mixed response towards grading system for charities”. The survey reported in the press release, which followed conversations between YouGov and NPC, asked people how interested they would be in an independent rating system measuring charities performance. The results are confusing to say the least, and not particularly encouraging.

According to the survey, 68% of people would switch their donations to another charity if they found the one they were supporting was performing badly. So far, so logical. But only 40%—a substantial minority, but still a minority—are interested in a charity rating scheme to provide independent assessments of organisations.

Given this, it is hardly surprising to find that 68% of people think that an independent rating system would not affect their giving decisions. Only 25% would be more likely to give.

There is something strange in these figures. In particular, the fact that 68% say they would change the pattern of donations if they were given evidence of poor performance, and the same percentage saying they would not respond to independent evidence. Reconciling these is tricky.

One possibility is that donors think they have the right information already so adding to this would not help much. If so, that is surprising. The quality of information provided by charities about their work and, crucially, their impact, is poor.

If donors wouldn’t respond to more information, that suggests they don’t want more. This is bad news for people who assume that some form of ‘market pressure’ will lead to better communication of charities’ results, a more sensible allocation of donations and more giving. Or, abandoning a market-based rhetoric, it is bad news for people who think that donors can be helped to give more sensibly and rationally.

Of course, it is possible that the general public is simply wrong, and more information would lead to changes in behaviour. And there seems little doubt that more information, including about performance and reputation, is coming. But the survey certainly provides food for thought and cautions against those—including, to some extent, NPC in its earlier form—who believe that more information is straightforwardly the key to a better sector.

NPC has in the past argued that rich people need to be encouraged to give more and that the distribution of donations is wrong. We have sought to address these issues by improving the quality of information and advice about the work and performance of charities. The YouGov survey questions whether people really want additional information.

As we have learned and reflected in our strategy, getting more donors to care about the performance of charities is an important part of building a better ‘market place’ for charitable funding. Building a market is very different from servicing an existing market and demand. The YouGov survey reinforces the importance of that shift.

NPC’s experience and analysis demonstrates that there are many charities doing good work. Improving their ability to attract funding and grow their work by building this market place remains a worthwhile mission.