Conversation with Paul Penley of Excellence in Giving

Participants

• Paul Penley: Director of Research, Excellence in Giving
• Katja Grace: Research Assistant, Machine Intelligence Research Institute
• Nick Beckstead: Research Fellow, Future of Humanity Institute; Board of Trustees, Center for Effective Altruism

Notes

This is a summary of Paul Penley’s points in a conversation on April 3, 2014, written by Katja with substantial help from the other participants.

What kind of philanthropic advising work does Excellence in Giving do?

Excellence in Giving is a philanthropic advisory firm with around seven staff members. Around 20 families retain them to act in the place of foundation staff, and other foundations consult with them on specific issues. Excellence in Giving provides an experienced staff who can share what they have learned serving clients for the past 12 years with new family foundations. They don’t manage money, but they do track giving, structure grants, research grant effectiveness, produce grant impact reports and plan experiences for clients to see and celebrate their giving’s impact.

The research department at Excellence in Giving evaluates nonprofit organizations, performs community solutions assessments and sets up outcomes measurement processes for grantees to ensure its clients support strategic, well-managed charities making a difference. Evaluations at the organization level are discussed online here. Such organizational evaluations have taken place at after school programs in Iowa, colleges in Oxford, children’s charities in Uganda and Kenya, and charitable trusts in north India.

Assessments of community needs and solutions tend to focus on a geographic location (e.g. Chicago), a population to be served (e.g. inner-city youths), and a focus area (e.g. early childhood development). They will identify problems among the population to be served that are related to the focus area, organizations that work on those problems, and solutions to those problems that have evidence of helping to alleviate the problems in question. This involves making tough judgement calls with data in hand from quantitative and qualitative research methods. Often an intervention is valuable, but enough work is already being done on it. This judgement call has to be made, but it can be hard for people working on an issue to hear that it’s not strategic to put more effort into a problem while the problem persists.

It is important in this process to distinguish the senses in which a problem seems bad. Sometimes a problem seems bad because a situation is suboptimal, though it may be rapidly getting better. This should be distinguished from something which seems bad because it is deteriorating, or because it is stably resistant to improvement.

This community level evaluation process might yield several opportunities to address real needs with solutions that have strong evidence behind them, and then Excellence in Giving works with the client to select among those opportunities. The decision between the best contenders tends to be made based on personal values and beliefs.

Sometimes these evaluations are done at the geographic location level, open to any population and focus area (e.g. any problem at all in Chicago that is relevant to any population). Excellence in Giving is currently working on a Community Solutions Assessment in Glynn County Georgia for a local client. They have also done these evaluations with a specific focus area in mind, but in any geographic location (e.g. human trafficking anywhere in the world). They do not have experience doing this kind of open-ended work in medical research. They have not done fully open-ended research on any geographic location, any population, and any focus area. Paul suspects this would be prohibitively difficult to do well and would involve highly questionable judgment calls. They have not had demand for this type of research.

Paul is familiar with effective altruism and says they do not frequently encounter people with the kind of utilitarian mindset that might make extremely open-ended, cause-neutral research attractive. Paul is sympathetic to the motives, but skeptical of the feasibility that research program given the number of highly controversial judgment calls that would be involved. It is easy to rank children dying in Africa ahead of wild donkey preservation efforts (contra Rockefeller Philanthropy Advisors purely issue-agnostic stance), but creating some calculation of value that can rank all issues in all geographies among all vulnerable populations is ultimately subjective and uncertain. He mentions the Hewlett Foundation until recently had a program to encourage effective philanthropy, but abandoned it because they were unsatisfied with the results.

The evaluations that Excellence in Giving does are the property of the clients who pay for the evaluations. Excellence in Giving is happy for clients to make this research publicly available if they wish. Sometimes clients have been quite enthusiastic about publicizing the reports, for instance making websites to showcase them. However, most clients want the organizations to improve after reviewing the critiques and recommendations rather than be pigeonholed with all their problems. Most charities Excellence in Giving evaluates issue a written response with action steps for improvement so the evaluation’s sponsor knows how he or she helped make them more effective.

If Excellence in Giving was serving a philanthropist who wanted to put more resources into finding good opportunities within an area, there is much more work that could be done. That is, at the usual scale of such investigations, they are not reaching very diminishing returns to research. There is always more primary research about a community that can be done to judge what is most needed and what is actually driving transformation. That is one reason Excellence in Giving sets up Outcomes Measurement processes for grantees. They want clients to know if they are really making a sustainable difference in the lives of beneficiaries or just an annual donation to a charity’s budget.

Clients

Before investigating potential interventions, Excellence in Giving endeavors to thoroughly understand a philanthropist’s personal journey and formation of values. As part of this process, the philanthropist completes a detailed survey, covering their lifetime experiences, professional background, interests, beliefs and values. Paul believes it is important to meet people where they are through this process, even if the long-term goal is to educate them toward more effective and strategic giving priorities.

Nobody ever hears their pitch and says ‘why would you want to do that?’. Almost everyone agrees with Excellence in Giving’s goals in principle. But saying you want to support effective organizations solving the world’s greatest problems (where possible) is different than investing the time and money to do so. As the Money for Good 2010 study found, 85% of funders might want to fund effective organizations but only 3% compare the effectiveness of charities when determining who to support.

Resources they use

There is a huge amount of information available already, in the form of academic articles, across many areas. However it is quite hard to find and use. There may be ways to organize it that would make this work easier. Associations of funders like the Philanthropy Roundtable in the USA do issue papers on effective interventions to support but no comprehensive, easily accessible and searchable repository for effective interventions to fund for different issues, geographies and populations exists.

Similarities and differences to other organizations

Excellence in Giving’s research is substantially more in depth than most family foundations conduct for their own purposes. They have also developed sophisticated tools for assessing organizational health, a focus that they believe sets them apart from for instance GiveWell. Paul expects they would be more concerned than GiveWell if an organization with a good program historically had a change in leadership for instance. Excellence in Giving is also less inclined to publish a general ‘top three’ list, as they are uncomfortable making the arbitrary judgment calls required for doing this across all issues, geographies and populations.

There are probably a dozen Philanthropic advisory firms like Excellence in Giving, and a large number of individuals who do similar consulting work. (There is a good website at which to see such groups here) Some of these individuals and firms create conflicts of interest by doing philanthropic advisory work interspersed with working for the charities which seek funding from philanthropists.

How could someone get into this kind of work?

Excellence in Giving is always looking for interns and currently hiring for an entry-level research position. Someone qualified to do this work would be capable of analyzing academic research relevant to philanthropic advising and presenting it in a way that would be relevant and compelling to someone from the business world. It’s important that someone doing this work is willing to discriminate between philanthropic opportunities, rather than being enthusiastic about all options. They generally prefer candidates with some experience in academic research at the master’s level and some work experience, though this would not be a strict requirement and decisions would be made on a case-by-case basis. To a certain extent, some people are just ‘wired differently’ in a way that makes them good at this work. They naturally analyze, read between the lines, can focus on problems to solve for days on end and uncommonly have common sense about what works in the real world.

What future opportunities would be available to someone who worked in this space?

Someone who took a research job at Excellence in Giving could advance within the company since the firm continues to grow its top line revenue by double digits every year. They would also be a natural candidate for work as a program officer at a foundation. Experience in philanthropic advising and evaluation gives people who wanted to run a nonprofit both knowledge and wisdom about best practices in different program areas and contexts.