Hello! It has been far too long since last I wrote. For a long time (4 years to be precise) I found that I no longer needed writing as an outlet for comprehending my life experiences. I lived, studied and worked in the Netherlands for 2 years and then moved to Lesotho, Southern Africa, to work for a tiny paediatric HIV care facility (and met Prince Harry in the meantime!). I lived in a mud hut and my life was very simple yet unfamiliar and extremely challenging. That's a whole other story, one which I will perhaps tell another time. But I've now returned to London and work for another charity and I've found I've a lot to say. Namely on our nature of giving. It niggled away at my conscience in Southern Africa (countless white northerners visiting and leaving with a satisfied smile on their face because they'd left a handout) and I see it all the time here. Hand outs don't change people's lives. Monetary donations to charities/non profits can catalyse change. Donation of products can assist in the short run. But what people need to prosper and change is education, opportunity and work. That's what we need to be focusing on as consumers: putting pressure on companies to fulfil their corporate social responsibility with just that.
I'm a millenial. That is how I'm generally classed, having been born in 1990, and I accept that. I'll take it. So here's my voice, as a millenial (damned or otherwise) - I resent our cynics. Yes, we may spend far too long on mobile devices and yes, we've lost a lot in the art of face-to-face communication. I don't know if we're to blame for that.. it's the world you left for us and it moved so fast we didn't know how to keep up with it and old values. But one thing I can say for my generation is that we care about social
good. Our generation’s billionaire just donated 99%
of his wealth to charity. Just 6%
of consumers believe the singular purpose of business is to make money for
shareholders. 80% of young people want to work for a company that cares about
how it impacts and contributes to society.
This explains the rise of for-profit cause brands
like TOMS, Warby Parker, OneHope, FEED, and thousands of other consumer
companies that channel a percentage of revenues to non-profit partners. The
most effective of these, TOMS and Warby Parker, use the “One for One” concept
to clearly illustrate to consumers what each product they buy does in the world — these brands package an easy-to-understand donation with a purchase.
OK, so now for something controversial, especially
since (full disclosure!) TOMS Capital is an investor in Laxmi: donating free
stuff is among the least effective ways to help the poor. Free stuff rarely
moves people out of poverty, with the possible exception of medical devices
donated under very specific circumstances. Food banks and feeding programs are
better than stuff, but still a stopgap rather than a root solution.
This is heresy to many people in philanthropy.
Isn’t giving away stuff noble? Doesn’t it make the
giver generous and kind?
Sure. Giving things enriches the giver. But whether
those things enrich the receiver, the person we’re really trying to help if
we’re truly behaving altruistically, is another story. Famously, Western food
aid to Africa — one of the biggest donation programs in history — turned out to have an awful long-term consequence: dumping cheap grain
made it untenable for millions of African farmers to sell their food in local
markets. Big American agricultural companies subsidized by US taxpayers
profited from these contracts, leaving local farmers without a sustainable
source of income and perpetuating poverty around the continent. Now, several
big NGOs are lobbying to end the tyranny of agricultural subsidies in the US
Farm Bill (including one whose board I serve on, CARE).
Many now protest this kind of “big aid” run by
governments, and yet they do just the same thing when they buy One for One
products.
I’m not saying we should avoid buying One for
One-type products. These are far better than doing nothing, especially in the
case of health interventions like safe birth kits, eyeglasses (Warby Parker’s
partner VisionSpring is an
innovative charity that employs low-income people to distribute the glasses),
mosquito nets, or food, water and sanitation. But even health interventions are
most powerful when they are market-driven — when local people have enough money to purchase the services they need,
or to be taxed and thus contribute to funding for services at the government
level.
We can do better than One for One. If we really
want to make the world better, we have to listen to the people who need our
help, and heed the results of research. A preponderance of recent evidence
suggests that the
best way to help poor people is to give them cash, which they can use to purchase their own goods
and services independently of donors, governments, or other institutions.
Overwhelmingly, when poor people have cash, they spend it on things that enrich
the health, education, and resilience of themselves and their families.
And what’s the most sustainable way to give
poor people cash? Employ them. This seems so
obvious, and yet we don’t think about poverty alleviation as an employment
exercise. The best way to help those who need shoes, or clean water, or
eyeglasses? Give them a job. A job pays for school fees, visits to the local clinic,
mosquito nets, and anything else we can imagine a poor person may need. Jobs
create a healthy check on power, too — when people start paying taxes, they start reinforcing a social contract
between the government and its people.
Jobs > Taxes > Expectations About How Taxes
Should Be Spent > Accountability to the People
When governments get their revenue from foreign
donors via aid programs, this accountability dissolves. Accountability is the
only reliable way to build strong people, communities, and nations. And
accountability arises when poor people have an income.
Aid, including free stuff, is paternalistic, and a
trap — it keeps people poor by depriving them of the
chance to make their own decisions about what they need. So let’s demand
more. Let’s ask the companies that use One for One models to
take their social impact one step further and employ the poor directly, in the
supply chain. This may make their products more expensive. It may make their
supply chains more complicated. But it will build incredible loyalty among
workers and customers. In the long run, governments should provide tax benefits
to companies that behave this way and “impact source” from communities in need.
And in the short term, let’s demand an end to One for One. Let’s demand of the
companies we love to Give Work instead.
