This blog post is part of the Embedded Philanthropy Blog Series, sponsored by Telecom for Charity. The blog series was launched in May 2009 to highlight expert thinking and encourage discussions on the state of embedded philanthropy in today’s economy.
“Embedded philanthropy” (as defined by former GiveWell Board member Lucy Bernholz, via Tactical Philanthropy) is the practice of “building a philanthropic gift into another, unrelated, financial transaction.” The RED Campaign is probably the best-known example.
If you are thinking of participating as a consumer in embedded philanthropy, we urge you not to. Fundamentally, you are the one ultimately paying for the donation, as we discussed thoroughly here (if you don’t find the main post convincing, please see the comments as well).
Once you accept this claim, it appears that embedded philanthropy offers you, the consumer, no benefits, and has a couple of costs: (1) it narrows your options as a consumer (for example, you buy (RED) clothing instead of whatever clothing you want); (2) it narrows your options as a donor (i.e., the amount and recipient of your giving is determined by the company, not by you).
(2) is the more severe problem, and in some cases there may be ways around it. Telecom for Charity, the sponsor of this series, has informed me that its consumers can choose to donate to any charity of their choice (although I do not see this spelled out on its website). And with careful enough accounting, you can also make sure that your total giving for the year isn’t altered. But even in this best-case scenario, what’s the point? Why not just buy what you want and give what you want?
Much embedded philanthropy threatens to shift the choice of charity from individuals (giving for their individual reasons) to corporations (likely purely concerned with the PR aspects of the gift). All embedded philanthropy threatens to make donors feel they’ve “done their part” by signing up, instead of challenging themselves to give as much and as well as they can. No embedded philanthropy seems to offer genuine benefits to the consumer/donor. No embedded philanthropy can deliver on what I see as an implicit promise of “something for nothing” – the virtue of giving without the sacrifice.
Despite all this, embedded philanthropy may be a net force for good if it mobilizes enough giving that wouldn’t have occurred otherwise. It’s hard to turn our nose up at (RED)’s claim to have directed over $130 million to the Global Fund to fight Aids, Tuberculosis and Malaria (which we view as an unusually strong charity). (RED) has had an amazing amount of corporate and celebrity support, and I haven’t seen any other embedded philanthropy campaigns that appear to have had anywhere near the same impact.
We don’t pretend to know much about mass fundraising; we target the specific donors who seek to accomplish as much good as possible. Embedded philanthropy may be effective for the former; we feel it has little to offer the latter.