You did what with my donation? When donors feel betrayed by charities

December 29, 2019

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You did what with my donation? When donors feel betrayed by charities

When people learn that a charitable contribution they earmarked for a specific project was used for another cause, they feel betrayed - and often punish the charity, new research indicates.

Those donors were less likely to give money to the charity in the future or do volunteer work for the organization. They also were more likely to say negative things about the charity, according to the research published in the Journal of the Association for Consumer Research.

The findings held true even when their contribution was directed to another worthwhile cause, said the lead researcher.

What the researchers say: "The whole idea that a charity could activate a sense of betrayal is quite novel," said the co-author. "This wasn't fraud or embezzlement—the donor's money was still being used for good," he said. "But because the expectations were so high, they were upset when their donation was redirected."

The study comes amid the increasing popularity of donor-directed charities.

Instead of giving to a traditional charity that supports multiple causes, many people prefer to specify that their contributions will support a new well in a Tanzanian village or help a Costa Rican entrepreneur open a coffee business. As a result, contributions to donor-directed charities such as Donors Choose, and Kiva have risen by 700 percent over the past decade.

The research involved three studies. Participants made $1 donations to specific projects in rural areas of India or Peru, then they were told the charity used their money for a different purpose.

Respondents were most upset when their money was directed away from projects considered essential for survival, the researchers said. If they wanted their donation to finance a drinking water project, for instance, and it was used for a library instead, they had higher feelings of betrayal than if the library donation was used for the drinking water project.

In both instances, however, the respondents chose not to support the charity with their next donation. Charities are viewed as "moral actors" by the public and held to high standards, the research indicates. That magnifies people's sense of betrayal when a charity re-directs funds.

"It's almost like finding out that a police officer has committed a crime," the lead author said.

"Donor-directed contributions are popular because they foster a sense of connection and impact," the lead author said. "But people feel betrayed if their money doesn't go to where they thought it would. The main takeaway is: Do what you say you're going to do."

So, what? Earlier research has shown that many charities (DT’s infamous foundation for example) spend donor’s money in ways that are not always what the donor wanted or expected. Or sometimes it just gets lost in general “administrative” costs. It’s probably a good thing that people require much more transparency now as to how their donations are utilized.

Dr Bob Murray

Bob Murray, MBA, PhD (Clinical Psychology), is an internationally recognised expert in strategy, leadership, influencing, human motivation and behavioural change.

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