Since the suicide of 92-year old Olive Cooke in September 2015, charities have found themselves the focus of unwanted attention with regard to their fundraising activities. In particular, the use of so-called aggressive tactics has provoked irritation and distrust from the public. Charities have to be able to ask people to give; they can't rely on spontaneous acts of kindness as these simply aren't frequent or sizeable enough to cut the mustard. Nevertheless, fundraisers cannot allow themselves to fall into the trap of believing that worthy ends justify questionable means. Strong-arm tactics might yield short-term gains - but at what cost?
Evolutionary insights can tell us why people give to charity. Cleverly designed experiments have shown that making donations, or helping someone out, activates reward centres in our brain - it feels good to be good. This has been described as the 'warm glow' of giving. However, - and critically for charities - this fuzzy feeling is less pronounced when we feel pressured into giving. So more invasive fundraising techniques, such as door-to-door fundraising or cold-calling an existing donor to ask for more money, can be a big turn off.
One such strategy is 'donor upgrading', where one-off donors (e.g. people who have completed an event for the charity, or made a text donation) then receive a phone call to ask for a regular monthly contribution. It is estimated that around one in five people agree to this request - undoubtedly a boon to the charity. But what about the other four? There is a very real danger that the people who say no (i.e. the vast majority) dislike being pressured in this way and are effectively removed from the donor pool altogether. If I am right, this is clearly a problem for the entire sector.
Charities therefore find themselves in a social dilemma. They are incentivised to use short-term profitable strategies to extract money from donors, but the potential costs of doing so are borne by the whole sector. Over-exploitation of a shared resource in such settings results in system collapse - a tragedy of the commons. The only way to avoid this is to cooperate. For charities this might mean putting aside aggressive tactics that focus on maximising income from donors, and investing more into methods that maximise donor satisfaction and enjoyment from giving. In the short term this may well be costly - but it is essential for the long-term sustainability of the sector.
Just like fishermen sharing the same pond, charities need to harvest their shared resource of donors responsibly and sustainability - a failure to do so can be catastrophic. Insights from laboratory studies giving people similar incentives has shown that cooperation is most likely to flourish in the presence of explicit incentives: carrots and sticks. Nevertheless, in order to be effective, the incentives have to be stringent enough and to apply to everyone. The recent Etherington Report (aimed at increasing trust and confidence in fundraising regulation) notes that current sanctions against charities are ineffective for reasons that seem clear in light of the science: the Institute of Fundraising's (IoF) Code of Practice is too permissive in what it allows and only applies to member organisations. It comes as no surprise, therefore, that short-term income revenue maximisation has been allowed to dominate long-term sustainability in the charitable sector.
It is somewhat ironic that an industry aimed at eliciting pro-social behaviour from others has not yet found a way to work cooperatively among themselves. Nevertheless, the problem is not insurmountable. Charities now have a valuable opportunity to rethink the way they do business, and to find ways to work together to improve the way they use the donor pool. This will mean finding way to more strongly align individual organisations' interests with those of the sector as a whole. There is a wealth of scientific data that can be leveraged to make this happen - and plenty of experts who would love to help. Charities need to cooperate. But will they?