“The way we think about charity is dead wrong.” This is the title of the TED Talk given by Dan Pallotta in March 2013. Pallotta talks about how we give to charities. He says we focus too much on how the charity allocates money: to staff, programs, or marketing. And we frown about what we call “overhead.”
Instead, Pallotta says, we should be asking how the organization is impacting the world and fulfilling its mission. A charity that spends only 15 percent on staff may seem worthy of donations, but it may have little impact if it needs more staff to implement the programs well. Likewise, a charity may spend 60 percent of its budget on fundraising and marketing, and that may be effective if fundraising and marketing are growing the overall impact.
Pallotta’s ideas are worth considering, especially for Women of the ELCA. We are many things, but we are, especially, women who donate, raise and manage money for charities–including Women of the ELCA, the ELCA, and thousands of local congregations and organizations.
How we think about charity is important
According to Pallotta, charities have great potential to solve social problems that will never be addressed by the markets, but, he says, “it’s never going to happen by forcing these organizations to lower their horizons to the demoralizing objective of keeping their overhead low.”
Listen to the TED Talk and give it some thought.
Pallotta ends his TED Talk with this recommendation: “The next time you’re looking at a charity, don’t ask about the rate of their overhead. Ask about the scale of their dreams; how they measure their progress toward those dreams, and what resources they need to make them come true, regardless of what the overhead is.”
What if we took this challenge seriously?
Emma Crossen was director for stewardship and development for Women of the ELCA from 2011-2014. This Throwback Thursday blog first ran in June 2013. Photo by Elizabeth McBride of cupcakes offered during a Bold Cafe pop up event.