Our top charities for this giving season are GiveDirectly, Schistosomiasis Control Initiative (SCI), and the Deworm the World Initiative (DtWI) (led by Evidence Action). The first two have been recommended previously. The third is a new addition, and we encourage readers to see our full review.
We’ve had extensive internal discussions about how to rank these three giving opportunities against each other. These discussions have been particularly challenging this year because:
- The three have extremely different strengths and weaknesses, in our view. Much of the decision between them comes down to judgment calls about how to weigh factors such as (a) estimated cost-effectiveness of a charity’s activities (SCI appears strongest here, in isolation, though some staff discount this observation because of the low robustness of our estimates); (b) potential leverage (DtWI has a potential advantage here, as it focuses on influencing government spending rather than covering all costs with its own funds); (c) a direct and robust case for impact (we believe GiveDirectly is strongest on this front); (d) “upside,” in terms of potential for the charity’s growth to have far-reaching effects beyond the direct impact of its services. (We think all three have some “upside” but see GiveDirectly as particularly promising in terms of its potential to improve the aid community’s understanding of, and interest in, cash transfer programs.)
- The amounts of money given on the strength of our recommendations could be substantial, and so the question of “what do further donations accomplish?” can have complex answers: for example, the first million dollars to a charity can be quite different in their expected impact from the second million. We lay out what we know about each charity’s funding gap below.
For each charity, we have set out a “minimum target” that we very much hope to see it raise. The targets have no precision to them, but roughly speaking, we see more value in donations up to the minimum target for each charity than in donations beyond the minimum target for any of them. (In other words, if two of the charities had hit their minimum target and the third had not, we would prefer additional donations to go to the third charity until it hit its minimum target.) We believe that each charity will hit its minimum target. We would also be happy to see each charity raise funds beyond its minimum target, and expect that this will happen to some degree.
The minimum targets consider both the nature of the funding gap and the goal of providing positive incentives via rewarding charities that exemplify the values GiveWell is seeking to promote, such as transparency, strong monitoring and evaluation, and full participation in GiveWell’s evaluation process. We believe that all three top charities are outstanding in these respects and thus hope to move substantial funds to each, though we also feel there are some differences on this front that contribute to our differing minimum targets.
When it comes to donations beyond the minimum target, we haven’t reached a clear conclusion on which charities should be prioritized, and feel that donors will decide – reasonably accurately – which charities are the best fit for their own worldview and values with the guidance we provide. Accordingly, we have decided not to provide numerical rankings this year.
Please note that there will be some additional content coming out within the next 1-2 weeks:
- Good Ventures is planning to announce its own plans re: grants to top charities. We expect this announcement to come this week and expect that it may influence donors’ choices.
- We are planning to write about the evolution of our criteria for recommending charities, which are being modified from what they were in previous years. This content will not be directly relevant to the choice between charities (this post attempts to summarize all relevant considerations).
- We are also planning to have individual staff members (who feel comfortable doing so) announce their plans and their reasoning for their own personal giving. In general, the most popular choice internally is GiveDirectly.
The rest of this post lays out what we see as the key considerations regarding the funding gap, strengths and weaknesses of each recommended charity.
We provide the details of GiveDirectly’s funding gap in our review. In brief, GiveDirectly has told us that, to facilitate its planning, it aims to raise $40 million, the amount it budgets for 2014 and 2015. It hopes to spend $14 million in 2014 and $26 million in 2015.
As of the writing of this blog post, GiveDirectly has allocated or committed over $5 million to cash transfer campaigns (the vast majority of these funds in the past year), utilizing most of the funds it has received to date from donors.
Our understanding is that the majority of additional donations will go directly to cash transfers, which themselves are part of GiveDirectly’s (a) experimentation with its operational model as it expands and (b) experiments into the impacts of different models of cash transfer programs.
We hope that GiveDirectly is able to close a sizable portion of its funding gap, and have set a “minimum target” of $2.5 million, about half of what it has spent in the last year. We would be relatively comfortable with its receiving up to $20 million, though as it received more funds we would begin to prefer that those funds be allocated elsewhere.
Strengths and weaknesses
- Program impact and cost-effectiveness. Cash transfers are relatively strongly evidence-backed, and are in the range of our other priority programs’ cost-effectiveness, but our best guess is that cash transfers are 2-3x less cost-effective than the deworming programs carried out by SCI. Details at our updated cost-effectiveness spreadsheet. Our estimates are subject to substantial uncertainty.
- Monitoring and evaluation. All the programs implemented by our top charities are evidence-backed, but GiveDirectly is the only one that has a randomized controlled trial (finding strong results) of its own implementation of its program. Thus, GiveDirectly has been evaluated in a more rigorous way than our other top charities. We also feel that we have seen stronger evidence of successful execution of its program than for our other top charities.
- Directness and robustness of the case for impact. We believe there is a highly direct and robust connection between GiveDirectly’s receiving funds and those funds reaching very poor individuals. We believe GiveDirectly to be the strongest of the recommended charities on this front.
- Transparency and participation in our process. GiveDirectly has been exceptionally open with us, enabling us to understand the full details of its work.
- Scale. Were GiveDirectly to receive the full level of support it is seeking, this would result in a significant increase in scale. We view this both as a risk and an opportunity. As of the end of 2013, GiveDirectly was distributing cash at a rate of approximately $3.6 million per year; it hopes to reach close to $15 million by the end of 2014. GiveDirectly has scaled up successfully in the past; it had been distributing cash at a rate of $360,000 per year at the end of 2012. For donors who believe GiveDirectly can effectively scale up, this represents an opportunity to provide early-stage funding to an organization that may eventually grow to be much larger. For donors who are skeptical of GiveDirectly’s ability to scale, providing such funds may appear unreasonably risky (though only after the first $5-10 million in support; the first $5-10 million would be consistent with the size GiveDirectly has been to date). Full GiveDirectly review
SCI has told us that it hopes to raise at least $4 million for work it plans to undertake in 2014 and believes it could effectively absorb up to $10 million (though some of this spending would spread into 2015). This work would mostly consist of direct implementation of deworming.
Since November 2011, when we first recommended SCI, SCI has received approximately $4.6 million in unrestricted funds. It has spent $2.9 million, committed an additional $1.2 million and approximately $1 million remains unallocated, including approximately $500,000 it had in reserve prior to our recommendation (more).
We have set a “minimum target” of $1 million for SCI, which is consistent with the levels of GiveWell-attributable funding it has received in the past. We would be relatively comfortable with its receiving up to $10 million, though as it received more funds we would begin to prefer that those funds be allocated elsewhere.
Strengths and weaknesses
- Program impact and cost-effectiveness. Our best guess is that SCI’s deworming program is more cost-effective than cash transfers by a factor of 2-3x and 1-2x as cost-effective as DtWI’s deworming program. Details at our updated cost-effectiveness spreadsheet. Our estimates are subject to substantial uncertainty.
- Monitoring and evaluation. We recently became aware of major limitations to the studies we had previously been relying on as evidence of SCI’s impact. We will be reviewing further evidence that SCI sent us in response; we had not previously focused on collecting such evidence because of our impression that the studies we were using were sufficient. The program SCI works on (deworming) is relatively strongly evidence-backed.
- Directness and robustness of the case for impact. We believe that the connection between SCI’s receiving funds and those funds’ reaching very poor individuals is more direct than DtWI’s but less direct than GiveDirectly’s. SCI has spent (and plans to spend) a sizable amount of its budget directly carrying out deworming programs, but it also spends funds on a variety of activities related to deworming (e.g., advocacy, operational research).
- Transparency and participation in our process. From 2009 (when we first made contact with SCI) through mid-2013, we struggled to communicate well with SCI. Since August 2013, our communication with has SCI has improved substantially. We still do not feel that we have the same level of visibility into SCI’s operations as we do into those of our other top charities, and this is a major factor in the relatively lower “minimum target” we have set for SCI as opposed to other top charities, though we are optimistic that this will change in the next year.
- Scale. Were SCI to receive $5 million, it would represent an increase in the amount of funding it processes. SCI has spent (or committed) approximately $2 million in unrestricted funds in each of the past two years and is currently primarily funded by a 5-year, ~$15 million grant from DFID. It is currently under consideration for a 4-year, $15-18 million grant from DFID. In sum, SCI has been operating at a level of approximately $6 million/year and may soon be operating at a level of approximately $10 million/year (due to the DFID grant). An additional $5-10 million would increase its scale further.
DtWI has told us that it would like to receive $2-3 million to give it the flexibility to pursue opportunities that are not directly funded by other donors. It has also told us that Evidence Action, its parent organization, has a funding gap over the next 2 years of $5-7 million.
Because our analysis has focused on DtWI, we have focused on its funding gap.
We would like to see DtWI close much or all of its gap so that it can have an adequate supply of unrestricted funding, and we have set a minimum target of $2 million. We see significantly less value in funds beyond that point, and particularly past the $3 million mark.
Strengths and weaknesses
- Program impact and cost-effectiveness. In isolation, our best guess is that DtWI’s deworming program is likely less cost effective than SCI’s (about 50-100% as cost effective) and GiveWell staff differ about its cost-effectiveness relative to cash transfers (1.5-3x as cost effective). This is because worm infections appear less prevalent and (particularly) less intense where DtWI works than where SCI works. However, DtWI focuses on influencing government spending rather than covering all costs with its own funds, and we think it is therefore appropriate to give it some degree of credit for “leverage” – making your dollars go further than they otherwise would. Estimating the degree of “leverage” is highly subjective; our best guess is that it should add a multiplier of about 3 to the cost-effectiveness, making DtWI more than competitive with other top charities on this front. Details at our updated cost-effectiveness spreadsheet.
- Monitoring and evaluation. We believe DtWI’s self-evaluation to have been less rigorous than that of GiveDirectly, though we are hopeful that it will improve going forward. (As noted above, we are currently revisiting the quality of SCI’s self-evaluation.)
- Directness and robustness of the case for impact. DtWI is a technical assistance/advocacy organization, and therefore the chain from donation to person helped is the least direct of any of our top charities. This is the flip side of DtWI’s potential “leverage” – because it focuses on influencing and assisting other players rather than on direct implementation, its value-added per dollar spent is quite plausibly higher but also harder to pin down.
- Quality of communication. From 2009 (when we first made contact) through early 2013, we struggled to communicate well with DtWI. Since early 2013 (which coincided with DtWI changing its leadership), our ability to communicate with DtWI improved substantially. We now feel that we have as much visibility into DtWI’s operations as we do any of our other top charities.
- Scale. Our understanding is that $2-3 million in unrestricted funds will provide DtWI with flexibility that will be helpful as it grows. Because DtWI requests $2-3 million, we would expect that any funds it receives above $2-3 million would likely effectively support Evidence Action more broadly (e.g., its Dispensers for Safe Water program, which we have not examined although we have published a report on water quality interventions, and potentially other initiatives that it might launch).
- Fungibility. DtWI is an initiative led by its parent organization, Evidence Action. There is some possibility that funds given due to this recommendation effectively support Evidence Action and its Dispensers for Safe Water program (or future initiatives) rather than DtWI. If donors are particularly concerned about this, they should carefully consider their support of DtWI.
We believe that it is not unlikely that AMF will reach an agreement to use the bulk of its funds in the next 6 months, and therefore would not be surprised if donors choose to continue supporting it.
We will continue to follow AMF’s progress and reconsider its recommendation status if/when it finalizes a distribution.