A lot is said about charities. Not all of it is true.

Charities are forces for good, and much needed ones in our world where wars, catastrophes and inequalities thrive.

Here are some of the common myths we hear:

Belief #1: Charities Can't Be Trusted

In the altruistic world, a common misconception often deters potential donors: 'Charities can't be trusted.' However, this blanket belief isn't rooted in objective truth. Across the globe, thousands of nonprofits and charities operate not only with transparency but also with tangible societal impact. They bridge the gap between generosity and need, facilitating societal resurgence in areas truly fraught with adversity. Just like any industry, charities do have black sheep - initiatives that may operate under unethical pretenses. Nonetheless, stringent regulatory bodies and increasingly easy public access to financial records have significantly narrowed this pool. As such, it’s essential to weigh the provenance of 'Charities can’t be trusted' and understand that, while caution is always an ally, wholesale cynicism could deny aid to those who really need it.

Belief #2: Too Much Goes to Administrative Costs

Too Much Goes to Administrative Costs. It's a frequently held misconception that charities spend a majority of their funds on administrative costs, leaving less for the cause itself. However, this belief tends not to hold up against the actual facts. Responsible philanthropic organizations understand that to execute their missions effectively, they have to allocate a reasonable portion of their budget to streamline administration. This doesn't detract from the cause but rather facilitates smooth operations and productivity. By tackling and managing administrative expenses tactically, charities can enhance their impact and ensure more funds effectively reach those in need. Thus, before tagging a charity as less efficient due to its administrative costs, it's essential to understand the background. Dan Pallota's Ted Talk gives an interesting point of view on this.

At the end of the day, it's important to understand that a balanced portfolio of supported charities is what will help the most.

Keep on reading to learn more about that.

Belief #3: Bigger Is Better

This one requires a bit of understanding about the operational dynamics of charities. It's commonly believed that bigger charities are always the best, often because their size equates to more accessible resources or means. However, this isn't necessarily true. Both small and large charities have their unique roles and impacts in society. While larger charities may have a broader geographical reach, smaller charities may boast a more hands-on, grassroots approach which can convey a greater sense of personal involvement and community building. The effectiveness of a charity should not be exclusively gauged on its size but instead should be judged mainly on how effectively it utilises its resources to achieve its mission and objectives.

We could imagine sustainable help as feeding a starving person (give him a fish - local charity), while teaching them how to fish (medium size charity), and ensuring the knowledge is passed down to the next generations along with additional development opportunities (large charity).

=> So, what kind of charity should I support?

Across the globe, supporting charities of all scopes– from small community Non-Government Organizations (NGOs) to big international ones - is critically important as they play pivotal roles in humanitarian and social efforts. Be it a local food bank that combats hunger in neighborhood communities, or a larger, multinational charitable organization focusing on global issues like poverty eradication or environmental conservation, each plays a unique and essential role. Small charities, being close to the ground, have a finely tuned sense of what their local community requires, enabling concise and targeted assistance. On the other hand, big charities have the infrastructure and influence to effect change on large scale, potentially shaping global policies to create a better world. Therefore, supporting charities of all sizes not only nourishes local communities but also contributes to the global fight against myriad challenges that humanity faces today.

Belief #4: Charities Don't Contribute to Sustainable Change

It's a common misconception that charities do not contribute to sustainable change. The reality, however, contradicts this common belief. In the world of philanthropy, countless charities have been creating a remarkable and lasting impact within communities. They assist in building infrastructure, implementing educational programs, and providing essential resources for sustainable living. By igniting grassroots movements and supporting local initiatives, charities empower communities to become self-reliant and progressive. Their strategic interventions and ongoing support foster resilience and spur sustainable development. This asserts that it's about time we change our perspective and acknowledge the significant role charities play towards a more sustainable and equitable world.

Belief #5: All Charities Operate the Same Way

This requires an understanding of the distinct workings of these organizations. It's right to say that many charities share a common goal of philanthropy, aiming to make a positive impact in society. However, the operations, approaches, and methodologies each charity uses can be vastly different. One might focus on direct action, providing food and water to disaster-stricken regions, while others may aim to shape policy, advocating broadly for social change. This diversity in operation strategies is necessary for a sustainable approach to helping communities. It also presents a wealth of choice for donors, enabling them to align their contributions with causes they deem closest to their hearts. So, the next time you're considering a donation, it's worth researching the charity's operations rather than presuming they all operate the same way.

Conclusion

In conclusion, the misconceptions about charities often stem from a lack of understanding about their operational structures and sources of funding. While it is true that administrative costs can form part of a charity’s expenditure, this is essential for ensuring its efficient and impactful operation. Further, many charities work hard to uphold transparency and accountability, contradicting the myth that they are opaque and unaccountable outfits. They regularly publish comprehensive financial reports to keep the public informed about their activities. However, their human & financial resource limitations sometimes prevent them from offering as much transparency as they’d like. In Australia alone, there are about 60,000 charities, and less than 5% of them get 80% of all the donations. You can easily understand that the remaining 95% are under-funded, under-staffed, and lack the means to showcase their work.

That's what we are changing at Tap4change.org

It's essential to challenge these misconceptions and seek evidence-based information on the charities we support. By dispelling these myths, we can enable a healthier and more informed charitable sector that is better equipped to fulfill its fundamental role – to deliver impactful services to those in greatest need.

To go further: "The cake paradox"

As donors, can we ask for all our donations to go towards impact on the ground, and then require detailed reporting on every dollar? That sounds like eating the cake and having it too.

In the world of charitable contributions, every donor dreams of the perfect balance. We all yearn for a scenario where we can quite literally 'eat the cake and have it too,' where every cent of our precious donations directly influences change and makes a tangible impact on the ground. Yet, we simultaneously crave the transparency and meticulous reporting detailing every dollar's journey. Which requires a significant chunk of donations gets dedicated to maintaining the conduits of transparency—administrative costs, auditing procedures, and detailed report generation.

Our goal at Tap4Change is to allow for charities to be more and more transparent in a continuous way for donors (vs once a year in a report), without engaging in costly and time consuming activities.

Pre-register here for the Donation Experience Revolution!