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.

Antiretroviral treatment (ART) is one of the more well-publicized ways to help people in the developing world. The (RED) campaign puts it front and center, and the Gates Foundation places heavy emphasis on it as well. It seems at first glance like a fairly straightforward, if expensive, intervention: directly treat HIV-positive people with proven drugs to extend their lifespan and improve quality of life.

But the Copenhagen Consensus disease experts (also lead authors on the Disease Control Priorities report) make the case for caution (from pg 40 - emphasis mine):

• Poor implementation (low adherence, development of resistance, interruptions in drug supplies) is likely to lead to very limited health gains, even for individuals on therapy. (This outcome is unlike that of a weak immunization program in which health gains still exist in the fraction of the population that is immunized.) Poorly implemented antiretroviral drug delivery programs could divert substantial resources from prevention or from other high-payoff activities in the health sector. Even worse, they could lead to a false sense of complacency in affected populations: evidence from some countries suggests that treatment availability has led to riskier sexual behavior and increased HIV transmission. The injunction to “do no harm” holds particular salience.
• Unless systematic efforts are made to acquire hard knowledge about which approaches work and which do not, the likelihood exists that unsuccessful implementation efforts will be continued without the appropriate reallocation of resources to successful approaches. Learning what works will require major variations in approach and careful evaluation of effects. Failing to learn will lead to large numbers of needless deaths. Most efforts to scale up antiretroviral therapy unconscionably fail to commit the substantial resources required for evaluation of effects. Such evaluations are essential if ineffective programs are to be halted or effective ones are to receive more resources.
• Many programs rely exclusively on the cheapest possible drugs, thereby risking problems with toxicity, adherence, and drug resistance. From the outset a broader range of drug regimens needs to be tested.

An ART program needs to use the right drugs, ensure compliance, be there for the long haul, and deal with side effects (both medical and behavioral). None of these are a given, with the (RED) campaign’s beneficiaries or anyone else, until you see the evidence that the programs are working.

And ART costs can be in the range of $600 per patient treated per year. Compare with vaccinations, which are estimated as saving lives for as little as $200 apiece, have a strong track record of success, and in many ways introduce less potential for complications.