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When Donors Do More Harm Than Good

Back in June I wrote a piece for the Stanford Social Innovation Review blog which argued that the first rule of corporate philanthropy is to do no harm.  I still believe this to be true, but I want to broaden the idea because I really think that the first rule of all philanthropy is to do no harm.  It’s not a surprising supposition since harm is the last thing any donor wants to see happen as a result of his or her giving, but it remains a challenge for donors because unexpected consequences are also a fact of life.

In the 1970s the World Health Organization promoted the widespread use of DDT, an insecticide found to be highly effective in killing mosquitoes, to help prevent the spread of malaria in the developing world.  Unfortunately, it was also effective in killing a number of other insects and animals, particularly in Borneo where the disrupted ecosystem resulted in a country-wide rat infestation.   Although just one example of how good intentions can go wrong, it’s a useful starting point when looking at how easily donors can sabotage their goodwill.

One of TPI’s most thoughtful donors likes to say: “The best way to ruin a good idea is to try to improve it!” Donors risk doing damage when they try to insert their opinion and will into a situation instead of deeply listening to those they want to help.  Alan Broadbent, Chair of Maytree in Toronto puts it this way: “If the gift isn’t what the community wants, it isn’t worth doing.” Melinda Marble, Deputy Director at Barr Foundation, has long echoed this sentiment and advocated that “those at the center of the problem need be at the center of the solution.”

Donors must remain good listeners and they must also be aware of the power of their wealth since sometimes money can do more harm than good. Funders are imperative to nonprofit operations, but in some cases they are a necessary evil.  Nonprofit organizations are constantly pressured by donors to do things that draw them away from their mission and sometimes they agree because they so badly need the funds. That is the worst kind of hubris on the part of a donor who, in attempt to help the organization has in fact done it harm. The same result can occur when there is too much money and no plan to manage the funds.

One of the most interesting non-gifts – and a great example of a donor who both listened to the community and recognized the potential negative impact of his donation – is the story of John D. Rockefeller and Alcoholics Anonymous.  Rockefeller was approached by Bill and Dr. Bob, a couple of men looking to start an organization to help alcoholics.  Mr. Rockefeller listened to Bill and Dr. Bob and was very impressed with the concept of AA, but he turned them down for a gift because he felt that it would ruin the idea. If AA was to succeed it had to be totally managed, and funded, by the participants. It was an inspired decision that made all the difference in the subsequent success of AA serving its community of interest.

So what are the lessons here for donors?

1)      Listen carefully and sublimate your own opinion and ego

2)      Ensure that the voice and needs of the community are being heard and served

3)      Make sure there is a good plan in place for the use of the funds

4)      Consider the unexpected consequences


Filed under: Strategic Philanthropy


One Comment

Stefan Lanfer

For another great example of helping by not helping, Melinda did an interview last year with Jesus Gerena of Family Independence Initiative Boston. An inspriging example of what happens when funders and other “helpers” get out of the way of “people at the center of the problem” at:

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