Charity Wash? Facebook Supports Questionable Charities
Tis’ the season to donate and if you’re so inclined there are lots of folks trying to help you do it. Facebook has jumped into the game with an application to give Facebook Charity Gifts. Through the app, you make a donation as a gift in a friend’s name and your friend receives a nifty icon on their Facebook page. Sounds like a great proposition, right? The problem is that Facebook did not do its homework on all these nonprofits.
A quick check on Charity Navigator reveals that only seven of the twenty-one nonprofits (33%) were given 4-star ratings: American National Red Cross, One Economy Corporation, Heal the Bay, Islamic Relief, MERCY CORPS, Humane Society of The United States and United States Fund for UNICEF. One group earned 3-stars (”good”), two groups earned 2-stars (”fair”), two are hospitals (and not 501c3 charities)[CORRECTION: the hospitals are both in fact 501c3s] and seven groups were not even rated, including one group with no website [CORRECTION: LOVEFUTBOL does have a very nice website], no HQ and listed “c/o” someone who apparently lives around the corner from me. I should add that looking at the rating is not always enough. As a reader named David pointed out in a comment to the post last week, notwithstanding its 4-star rating, UNICEF has its own questionable practices.
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Facebook’s promotion of questionable charities came to my attention last week when researching another charity giving scheme. Call me naive, but I was surprised to find out that the mainstream media hasn’t been researching what it was writing about. Don’t all charities deserve support anyhow? Actually, not all charities are created equal. In the words of Charity Watch, make your donation count more, review charities before you donate:
As charities face inflation, government budget cuts and an increasing public demand for services, they ask you for more donations. Increasing numbers of charities use high-tech fundraising techniques. Mailboxes overflow with fund-raising appeals. Phone calls pour in from high-pressure solicitors. All this can leave you confused about which charities are most deserving of your contributions. Most charities are honest and accountable to their donors. Unfortunately, a few are not.
(Check out Charity Watch’s tips for giving wisely.)
There are thousands of terrific nonprofit organizations that do 4-star work and send the vast majority of your donations directly to the programs that they support. But, there are plenty that don’t strive for fiscal excellence. Some use a good chunk’s of your donation to pay for big salaries, fancy offices and slick fundraising appeals. So, when an article in Forbes mentions a nonprofit, they are tacitly endorsing it. All it seems to take is a well written press release. But, its not just the MSM. In an attempt to jump on the corporate social responsibility bandwagon, lots of companies—some with very far reaching messaging—are doing the same, including Facebook.
It begs the question, how did Facebook decide which nonprofits would receive its tremendous marketing clout? Did someone’s high school boyfriend think up LOVE FUTBOL? Is Youth Service America and its 2-stars an advertiser? I think we need to know. Facebook has 90 million active members and this kind of endorsement is potentially huge. Given the stats on some of these groups, however, it smells a lot like charity wash or reckless CSR. For the record, I sent a bunch of emails asking about selection criteria to various staff members at the group credited with building the app, Project Agape, but heard nothing back. So, lets send a message to Facebook: it really isn’t hard to set some standards, guys. You owe it to us.
The other point is that we should choose only high performing nonprofits to align with. There are plenty of opportunities to align with really good nonprofits that strive for excellence and transparency. Take Ecohaus, a distributor of green building supplies and household products in the Pacific Northwest. This holiday season customers can drop off non-perishable food items destined for two local food banks and enter a drawing for a $100 ecohaus gift certificate. When I clicked through to the food bank sites from the ecohaus site, both food banks state right upfront how much money goes to admin and how much goes to programs. No mention of “nominal fees” or any other such marketing claims. Ecohaus’ CSR program is well designed (CSR that brings potential customers through the doors) and they obviously know and trust the charities with which they have aligned. CSR is really good stuff, but programs and alliances need to be designed carefully and with thought. Just the way you do everything else in your business.
Update: At 6:37PM EST, December 2, 2008, I received this response from Malorie Lucich at Facebook (Malorie@facebook.com):
Hi Jennifer,
All of the third party developers that build applications on Facebook Platform must adhere to Facebook’s Developer Terms of Use, including “You must be honest and accurate about what your application does and how it uses information from Facebook users. Your application cannot falsely represent itself.”
You can find more information here:
http://developers.facebook.com/terms.phpAlso wanted to mention that Facebook has over 120 million active users. You can find additional stats here: http://www.facebook.com/facebook#/press/info.php?statistics
Best,
Malorie
So, what do you think? Looks like they are passing the buck…
Update #2: It turns out that Facebook’s reach and influence is even greater than thought. First, I found out that in the last 2 years more people are being driven to charity web sites off Facebook than driven off of email; and, as Malorie mentioned, they actually have 120 million active users. Given their tremendous influence Facebook should be ashamed to not take the high ground.
Update#3: This is LOVFUTBOL’s HQ, 5105 Chevy Chase Parkway
Art by Iconspedia
This was a worthwhile post. My husband and I don’t often give to charities with high administrative overhead. But, we are aware that many Americans do give to organizations have better marketing. We often do our best to discus this with our friends. However, I have to say that linking to a charity which charges a membership fee for its information begs me to look at your article in a different light.
Nice to see that our client Mercy Corps has a four star rating.
Very interesting post. We have a few NGO and 501(3)c clients - we even offer them discounts see http://www.proformagreen.com/discount.shtml.
I am glad to learn about the Charity Navigator website so we have a tool for researching new clients in the charities area.
Love.Futbol does indeed have a website. The website is http://www.lovefutbol.org/. You should fact check your rants before you publish libelous information.
Thanks, John. Charity Navigator and Charity Watch are both excellent resources for listings of nonprofits.
Thanks for the interesting post. I enjoyed reading this, but I have to say, it worries me how inaccurate and “skewingly” mediated much of this is.
Let me start out with the blatant inaccuracies, then I’ll get to the other pieces that I think are “unfortunate” in terms of how you approach (and frame) them.
1. You said: “Did someone’s high school boyfriend think up LOVE FUTBOL (the group with no website)?” Actually, Love Futbol has a great website, check it out at: http://www.lovefutbol.org/ (how hard did you look?!)
a. You also said “one group with no website, no HQ and listed “c/o” someone who apparently lives around the corner from me..”. Again, please refer to the website. In under 15 seconds, I found their address (5105 Chevy Chase Pkwy, DC), phone number, and several contact emails.
2. You said: “two are hospitals (and not 501c3 charities)..”
a. Firstly, Brigham and Women’s hospital is most certainly a 501c3 nonprofit. You can verify this by going to justgive.org, then searching for it, clicking on the name, then looking to where it says “This organization is a 501(c)(3) Public Charity”
b. Second, I’d venture to say that you or someone you know firsthand has benefited from the work that goes on at Brigham and Womens. To learn more about it, go to http://en.wikipedia.org/wiki/Brigham_and_Women’s_Hospital . It is one of the 3 most renowned hospitals in the country
c. The second hospital that you say is not a 501c3 charity – well, it, too, is indeed a 501c3 charity. Use justgive.org and search for “Childrens national medical center”, and click the name, and then scroll down to “This organization is a 501(c)(3) Public Charity”
3. What worries me most is that youre writing on non-profits, but seem to rely entirely on charity navigator. Charity navigator is great, I agree, but they evaluate 5200 charities, out of 1.1mm 501c3s in the US. And they do this on numbers alone. This is quantitative evaluation, not qualitative. I agree that we should look out for wasteful charities, but did you notice that the 4-star rated charities you mention are HUGE? Mercy corps - $204mm in revenue. Red Cross: In the billions. The smallest has $5million in revenue. Accusing a nonprofit with 20% total overhead (admin+fundraising) of “using slick funraising methods and paying big salaries…” is just uncalled for and, as you say, naive. Charity navigator is good for weeding out the truly irresponsible NPOs, but for a small charity just starting to do good in the world, it may take some time to get to less than 10% total overhead, and I, for one, am ok donating to help them get there. Do you want a world with only the “giant corporations” of non-profits existing? I respectfully suggest you do some reading up on the organizations you criticize in your article, , however actiuvely or passively, as you are really dogging some phenomenal organizations (not to mention being completely factually wrong about many of them (see above)). Are you sure you want to be on record saying that the Red cross deserves your donation and One Laptop Per Child doesn’t? Did you read about the red cross’ handling of Katrina? Do you know what OLPC is doing out there? And do you think that because Brigham and Women’s isnt on Charity Navigator, it isnt a nonprofit and that its being on the gift list for Facebook’s Causes application means that Facebook has some “agenda”? This scares me. Again, read up on Brigham and Women’s here: http://en.wikipedia.org/wiki/Brigham_and_Women’s_Hospital You can read about how in 1832, the hospital “opens its doors to women unable to afford in-home medical care following fundraising appeals to individuals and various charitable organizations.” Was that not on Charity Navigator?
4. I think you wanted to have a thesis about how Facebook is like big brother and is choosing these charities, and you twiested the details to fit that plan, assuming readers would buy everything you say. One thing you should know, Project Agape is a Facebook application. It is NOT Facebook. Facebook does not control anything about it. So, when you say “Is Youth Services and its 2 stars an advertiser [on Facebook]”, it sounds a bit ridiculous and irrationally conspircay-theorist of you. This was also particularly funny for me to read right before a Sharp Electronics “Green” advertisement on your site blocked my view of your very article…
Cheers.
I also just read your response to Facebook’s response. You say Facebook is “passing the buck”. Jeez.
its funny to see you say this, but then also see how incredibly factually inaccurate your article is in more than a handful of ways (literally, and I think I proved that above). Will YOU pass the buck? (we will see if you post my comments, I suppose that will answer the question)
Thanks, Peter for the really thoughtful post. I appreciate the critism and some of your points are quite valid. Your overarching point that I shouldn’t “dog” groups just because they don’t have a Charity Navigator rating is fair. That said, I’d like to respond to all of your points:
Regarding LOVEFUTBOL: I gathered my information from that which was provided by Facebook on the app and its links, which showed no website: http://apps.facebook.com/causes/beneficiaries/140. All the other featured nonprofits included links to websites so I assumed it did not have one. Totally my bad for not going the extra step and googling it.
Regarding the corporate HQ: I have posted a photo above of 5105 Chevy Chase Parkway, NW, Washington, DC. As you can see it is someone’s home, not a HQ. In fact, according to a neighbor this morning, it is the parent’s home of someone involved with the organization.
Regarding the hospitals, again you are totally right, they are both 501c3 organizations. However, neither are rated by Charity Navigator. Either way, they are both, to my knowledge, reputable organizations and I did not mean to imply otherwise.
I apologize for stating that LOVEFUTBOL does not have a website and that hospitals are not 501c3s when neither of those statements are true. However, I stand by the rest of it and I don’t think those two mistakes make the entire post “completely factually wrong” about many of the groups discussed.
Regarding Charity Navigator. I used Charity Navigator as an indication of fiscally responsible management. I also mentioned that looking at Charity Navigator is not enough. The giving tips from Charity Watch suggest getting to know a charity before donating. The problem with what Facebook is doing is that most people who want to give a $10 gift donation are not going to bother doing their due diligence. Facebook has an awesome responsibility to its 120 million users to do that homework for them. And, having worked in the nonprofit sector, I believe that 20% is too high for non-programatic expenses. If you look at the CEO compensation for the Youth Service America, you’ll find it is over 6% of revenue and that’s out of line (the average is 3.32%). Also, $5 million is generally considered a medium sized nonprofit not huge. To me a lack of fiscal responsibility is an indication of an old-school nonprofit mentality that charities can be wasteful and do not need to be run like businesses. I am not alone in this belief. The Philanthropy Journal recently wrote: “Sadly, the charitable marketplace is saddled with fat and inefficiency. Fueled by a sense of entitlement and righteousness, far too many nonprofits focus more on perpetuating their own organizations than on improving the way they do business or deliver services.” (http://philanthropyjournal.blogspot.com/2008/05/big-challenges-in-nonprofit-growth.html). I guess we just have to agree to disagree on how much a nonprofit gets to spend on it self and of course, you should donate to whomever you like. And since you have clearly done your homework, I applaud you and thank you for sharing.
I also want to say I wasn’t dogging Women’s & Brigham or any of the other non-rated organizations. I called them questionable, meaning I was uncertain of the organization and was not given enough information to believe that were worthy of my donation (especially once I saw a few 2-star groups on the list). I was calling for Facebook to be more mindful in their choice of organizations to promote to millions of people. Some of the unrated groups look really interesting. I’d love to learn more about them. Did they apply to be included? If so, did they fill out a questionnaire about their policies and programs? If so, I’d love to see the answers.
As for Facebook’s culpability, if they were promoting a child pornography app they would be held responsible for the content. The rationale that Facebook isn’t responsible for what it promotes does not hold water with me. We can agree to disagree again. Also, did we promote Sharp Electronics recently? I missed that post…
Finally, my intention was not to dog good charities, but rather, to call Facebook out for promoting nonprofits that they apparently did not thoroughly vet. I wholeheartedly agree that a nonprofit should not be written off because they do not have a Charity Navigator rating. But, I also believe that Facebook needs to be more responsible for the content of its apps and what it promotes given its HUGE reach.
I really hope that everyone gives to charities this holiday season and gives generously. I also hope that people will do their research before donating so that the really good causes are rewarded for their fiscal and programmatic achievements. I hope this will restore donor reticence and complacency. I also hope it will raise the bar for corporate CSR activities and for all nonprofits, which I think is a good and necessary thing.
Dave-It may be a rant, but its not libelous to say a nonprofit doesn’t have a website when it actually does. It was an honest mistake which has been corrected.
http://www.lovefutbol.org/
This is a very good discussion and raises some very interesting points.
1. It’s pretty hard for an educated and informed, let alone a typical person to determine which charities manager their money appropriately.
2. There is indeed a need for more transparency in charitable organizations.
3. It’s a shame that organizations agree to sponsor or promote charities without doing their homework.
This type of open discussion educates and enlightens those of us interested in donating. I received an email yesterday from the owner of a large networking site currently in beta, noting that after reading this article she realized she needed to pout on her list, “vetting charities” as they ramp up….which I think is the point of this article.
For more information on why the address for Love Futbol is a residence, check out this Washington Post article about the founder: http://www.washingtonpost.com/wp-dyn/content/story/2008/10/14/ST2008101400045.html. Wouldn’t you say that reducing overhead by not paying rent on an additional office space is actually being fiscally responsible? If you’re looking for nonprofits to change the way they run things to reduce costs and break out of “an old-school nonprofit mentality”, please don’t jump to conclusions when they use creative ways to reduce spending that doesn’t conform to what you think nonprofits should look or act like.