15 Feb Should you donate to large or small nonprofits?
Charitable giving is on the rise. Last year, donations peaked at $360 billion, according to Giving USA, marking an all-time high since the recession. As charitable giving becomes more popular, donors are faced with a specific choice: should they donate to a small charity or a large one, like the Red Cross? According to the Huffington Post, vetting and evaluation is critical when making a decision of this nature. Ultimately, a small nonprofit can be just as effective as a large one—and vice versa. Therefore, it’s vital that a donor takes the time to understand the historical effectiveness of the charity or nonprofit they’d like to donate to.
Debate concerning the effectiveness of large and small nonprofits came to a head this June, when ProPublica published their findings on the Red Cross’ relief efforts in Haiti. The Red Cross raised $500 million in charitable donations—a truly staggering amount—and it outsourced much of its charitable efforts to nonprofits in Haiti. While having a larger nonprofit outsource efforts to smaller organizations is commonplace—these smaller nonprofits often have more experience with locals in a given area—the Red Cross didn’t pass along enough resources to the smaller nonprofits in Haiti, and these local groups struggled to achieve results with minimal resources and backing. In the end, the small nonprofits lacked resources, and the larger nonprofit had too many expenses and lacked transparency.
However, Melissa Kushner, founder and executive director of Good for Good, a nonprofit organization, noted in the Huffington Post that the Haitian scandal shouldn’t cause donors to favor smaller nonprofits over larger ones or vice versa. Instead, she notes, donors should take the time to understand how organizations are planning on using donations to achieve results. By working with transparent organizations and nonprofits, a donor can be confident that their donations will be put to effective use.
Good360 understands that transparency matters—that’s why the organization rigorously vets all the nonprofits it works well. Furthermore, donors can use Good360 to donate to a wide range of nonprofits, both large and small, to boost the overall effectiveness of their donations. To learn more, click here.