Philanthropic Harm: How “Doing Good” Can Go Bad

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We live in what might be called an Age of Scrutiny in philanthropy. Not only do we examine and judge more closely what donors and nonprofits do, but we also hear more open criticisms and debate more sharp and fundamental critiques. This is a healthy conversation to have, even if it makes us uncomfortable… and even if people (like me) fret over whether this attention to the potential dark side will overshadow the tremendous good philanthropy and nonprofits do.

Part of this heightened scrutiny and critique is greater attention to the actual and potential failures of philanthropy, the ways that donors or nonprofits do harm. We read lists like “Philanthropy’s Seven Deadly Sins” or “10 Ways Donors Can Be Less Than Helpful.” We are encouraged to “Confront Philanthropy’s Uncomfortable Truths” and to “Stop Trying to Save the World.”

To help guide and inform this discussion about philanthropic harms a bit, I’ve argued for a while that we can apply the Hippocratic Oath of “seek to do good but do no harm” to philanthropy — to those who try to heal society like doctors heal people. And I’ve been developing a working list of the ways that philanthropy might violate the Oath and do harm instead of good.

Below is that list of potential types of philanthropic harm. Each type is defined by the cause of potential harm, but implicit in each are consequences of the harm as well. Also, while a couple of these result from intentional harm, most are ways in which philanthropists seeking to do good might also unintentionally do bad.

Malfeasance, Corruption, Fraud

This is the most blatant form of philanthropic harm and can take all too many forms, from deliberate misappropriation of donated funds to hoarding food donated to disaster victims and selling it for profit, to using a fake nonprofit to funnel bribes from parents trying to sneak their kids into elite universities. Some cases of very high fundraising costs could fit in this category also, but not all.

Diversion of Resources

This is harm by omission and opportunity cost, by diverting scarce resources (time, talent, treasure) from a more effective or efficient solution, a more pressing or widespread need, or a more “deserving” recipient.

The much-debated National Committee for Responsive Philanthropy (NCRP) report, Criteria for Philanthropy at its Best, for example, implied this harm claim when it called for a higher percentage of funding going to lower-income communities and communities of color. Others claim that certain established programs become magnets for more and more giving, while fledgling organizations with amazing early success struggle to attract support. The Effective Altruism movement often implies — or outright claims — this type of harm when advocating for giving to some charities or causes over others based on cost-effectiveness metrics.

Reinforcing the Status Quo

Many observers of philanthropy argue that it can, in both subtle and obvious ways, perpetuate dominant power relations, and/or neglect to support truly disadvantaged groups or groups that seek more systemic social change.

We see this in the many critics who argue that institutional philanthropy supports causes that serve the elite instead of finding social justice nonprofits, communities of color, and so on. The popular recent book, Decolonizing Wealth, is an extended argument that philanthropy perpetuates a harmful colonial system and mentality. In our 11 Trends in Philanthropy for 2021 report, my colleagues at the Johnson Center explored how “movement capture” can be a form of this type of harm.

Favoring Philanthropists’ Needs Over Recipients’

Many people consider it harmful when philanthropy seems overly driven by the donor’s interests and needs. The uproar caused by Leona Helmsley giving billions to help dogs is perhaps the most infamous example here.

But there are more subtle examples as well. Foundations might give only to their trustee’s pet organizations, or to groups that provide easy-to-see results, rather than doing the work to find out which programs the community really needs or which ones produce more long-term or hard-to-measure outcomes. Or too much attention can be paid to helping donors have a good giving experience (e.g., attending a gala, getting an expensive recognition gift) or helping them feel good about themselves. Many of the most popular recent critiques of elite donors argue that their philanthropy is really just an attempt to whitewash their reputations.

Teleopathy

This is an unusual word for a not-so-unusual phenomenon. Coined by Kenneth Goodpaster as the “unbalanced pursuit of objectives” in an organization, teleopathy can occur in philanthropic organizations when people lose sight of the group’s mission as the primary goal; when they let other concerns (e.g., organizational politics, career goals) determine their actions. This is another place to categorize many of the concerns over unacceptable overhead or fundraising “ratios” in nonprofits.

Lack of Transparency

This sort of harm can involve secrecy that hides the real connections or reasons behind philanthropic acts, non-disclosure of various sorts, a lack of inclusion in decision-making processes that fails to account for certain voices, etc. This is one of those Seven Deadly Sins that Ali Webb identified after surveying philanthropic leaders about what can go wrong in their work.

Faulty or Inefficient Strategy

This is a more general category of potential harm that might actually encompass some of the others on this list. It occurs when a philanthropist’s faulty strategy causes well-meaning efforts to fail — or, at least, to be less effective or efficient than they could be.

The Bill and Melinda Gates Foundation have shifted their education giving at times to prioritize different solutions after learning from evaluations of their grantmaking that they weren’t being as effective as they wanted — as have Hewlett, Robert Wood Johnson, and other grantmakers (though mostly in private). Other foundations might decide they haven’t given large enough grants, or might cause harm by abandoning a solution before it has a chance to work, or might have a theory of change that ignores a major cause of the problem, and so on.

Faulty or Inefficient Implementation

Sometimes the negative consequences of philanthropy come from faulty implementation of the strategy. This has long been a critique made of international humanitarian and development organizations: detractors note that they fail to get resources to those in need because of lack of coordination, bureaucratic bottlenecks, ineffective systems of information sharing, or failure to adapt to changing circumstances. Some who say that a nonprofit spends too much on operations or overhead are making this claim of harm by inefficiency.

Lack of Measurable Impact

The issue here is one of uncertainty about whether good or harm is resulting from a philanthropic action. A community’s cherished youth literacy program might be producing only temporary benefits for the kids, or it might be creating major long-term positive outcomes. But without impact measures, the argument goes, we won’t know if we’re doing good, not so much good, or even harm. A related problem is when measures of impact exist but are ignored, as seems to have happened with evidence that the popular DARE program doesn’t prevent (and in some cases might even increase) drug use among teens.

Unintended Consequences

There are myriad reasons why good intentions can lead to unexpected bad outcomes, and the likelihood of this increases as problems and solutions become more complex. In Great Britain, the popular charity Oxfam has solicited used book donations and opened a number of local bookstores to generate revenue for their programs, but according to some for-profit secondhand booksellers, these fundraising efforts have hurt their business.

Oxfam’s response to this potential harm has shown both how harm is usually disputed, and how working to avoid or overcome it is the safest, noblest path. Another notorious example is the program designed to help keep teenagers from joining gangs that, unexpectedly, led to dramatic increases in pregnancy among those teens.

Short-Term Band-Aids

This well-known form of philanthropic harm occurs when interventions merely address the symptoms of a problem while ignoring the persistent and systemic causes and more permanent solutions. We all know the argument about — and many examples of — providing services to the downstream victims instead of advocating for system change upstream. Even once widely praised nonprofits like Teach for America face the charge of being mere “band-aids” that detract from efforts to address real or systemic causes.

Dependency

Another classic claim of philanthropic harm is that giving creates dependency on the part of recipients and discourages self-reliance. This view persists today in arguments that anti-poverty nonprofits should focus on job skills training instead of grocery vouchers or arguments for microfinance loans instead of grant “handouts.” A very popular book in our field calls this type of harm “toxic charity.”

Paternalism and Cultural Insensitivity

And yet another classic is this criticism of philanthropic interventions in the lives of vulnerable people as examples of paternalism. “Do-gooders” have long been charged with adopting a condescending attitude, imposing their own values instead of being sensitive to the values and situation of those they seek to help. This sort of argument was made against Victorian-era social reformers and continues today, for instance, in critiques of philanthropy’s savior complex.

Risks for Philanthropists

Of course, harm can also come to the philanthropists themselves as a result of their interventions for good. The risks of harm can be minor, as with the ordinary Good Samaritans stopping along the road to help, or extraordinary, as with Holocaust rescuers or searchers clamoring into collapsed buildings after an earthquake. The potential harm can also be emotional, such as the burnout affecting direct service volunteers, or even social and political, such as the harms of publicity that certain anonymous donors try to avoid.

Tainted Donors and Tainted Money

When I first published this list of philanthropic harms, I failed to include this one, and can’t believe I left it out. Not only is it a form of harm that has a long history, but it’s one that has become even more prominent in recent years, with the debates over what to do with Sackler money and other headline-producing examples.

In this type, the harm is done not by how philanthropic dollars are spent, but by how they were originally earned — or by whom. This controversy over the source of donated dollars is said to taint the good being done. This is harm by association, if you will. It can also lead to a decline in donations from other donors, among other bad things.

What else should be on this list?

This is my working list so far. Can you think of others to add? Do some of these need to be combined, split, or re-framed?

These days I wonder, for instance, whether “undermining democracy” needs to be a separate type of harm, given how many scholars and thought leaders are making that core critique these days. Others that have been suggested to me for consideration include lack of urgency, aversion to risk, insufficient funds or the “nonprofit starvation cycle,” lack of diversity and inclusion, insufficient voice for the affected in decision-making, overburdening grantees, exploitation of beneficiaries, or even nonprofits’ use of “poverty porn,” and others.

I share this working list in the hopes that it will spark additions, edits, and — most important — further reflections that will help us all to avoid these ways of doing potential harm. After all, in this Age of Scrutiny, the optimists are calling for donors and nonprofits to learn how to fail forward. And identifying exactly how we are failing is the first step.

This is an updated and expanded version of a post originally published in 2011. Read the original version here.