The giving season
Editorial by the Financial Times
November 30, 2012
The season for giving is upon us. The sad truth is that bleak times in much of the developed world mean that many no longer have much to give. In Britain, charitable donations have fallen by 20 per cent over the past year. But by giving people the tools to lift themselves out of poverty we can improve our own futures.
The internet revolution has made it easier to give than ever before. Small projects in remote areas can now appeal to donors on the other side of the world. Big charities can show donors that their money is being used wisely with web updates. And investors are waking up to the merits of social investment, where performance is measured in more than pennies and pounds and the results can be seen in real time.
But the ease of donating brings risks. Donors want to know that their money is having a direct impact by, for example, funding a specific school or village well. Some opportunists are exploiting this desire by charging exorbitant fees to list charities on project menus from which donors can choose. Donating is like any other financial transaction. Charities and donors should shop around for best value and read the fine print.
The Financial Times has chosen the Global Fund for Children for its seasonal appeal this year because it supports such local projects, which do not have the scale or expertise to tap into bigger agencies. Many focus on educating just a handful of homeless children or orphans. Just as business start-ups need venture capital, local initiatives need a helping hand to become sustainable agents of change in their own communities.
In the end, we will all benefit. Millions of children are deprived of an education, either through poverty or abuse. Yet research shows that income increases by 10 per cent for every extra year in school. As education levels rise, health outcomes improve and societies are more stable. All this is good for the global economy. Be generous. Wise giving is also good business.
Copyright The Financial Times Limited 2012.