Rethinking Charity

Jorline Ou
Sauder School of Business
4th Year Student, Accounting and Marketing


One of the questions that have been on my mind is, “are we making a difference?” We would hope, all our efforts, time, and sweat have all been for something. There have been hundreds of non-profit organizations and NGO’s whose singular purpose is to alleviate poverty, so why does it seem like no one has gotten it right?

There has been a prolonged debate about how to deal with poverty in developing countries. There has been continuous scrutiny of financial aid and lack of conditional monetary donations. It has been a part of our economy’s tradition to trade at value and exchange goods/services/currency that has provided growth to many countries, then what are the impacts of foreign aid?  It is, perhaps, a little crazy to give money to the poor with no strings attached.

The critique about foreign aid is no longer a foreign subject.  It has been considered to actually support corruption, as financial aid has been given to political systems that are still unstable (which is why SAI program hopes business education will bring a more sustainable impact.)This article: “Do cash grants really make a difference in business expansion?” [Business Daily Africa], outlines a few of the critiques of giving money out freely, on a macro-level but especially on the small-business micro-level.

Here are the highlights:

• Economist Dambisa Moyo authoritatively asserted that aid to Africa is making the continent poorer and should cease to exist
• African leaders have taken advantage of financial aid for personal gain
• Developing countries becomes expectant of the west to provide for the poor
• Business owners that invest own money has been said to take more due diligence in the management of their start-up
• Free money/grants provide way too much comfort and not enough discipline to elicit successful businesses

On the flipside, giving out money directly could also have positive results, as GiveDirectly advocates. The philosophy of GiveDirectly, is to donate money with no conditions and donate directly to the impoverished. This article “Is it nuts to give to the poor without strings attached?” [New York Times], explains their model in more depth.

Here are the highlights:

• GiveDirectly was inspired by the actions of the Mexican Government during the economic crisis in the 1990s, where the Mexican families receives cash transfers in exchange of the promise to keep their children in school and take them to regular health checkups
• Many people benefited from GiveDirectly, in spite of the worries of misuse of donations, people used the money in productive ways
• The money has been used on much needed home repairs, medicine, education, start a business, or expand a business
• This model “puts the choice in the hands of the poor”

These articles simply remind me that there are new things to be learned every day, even about the topics we believe we have expert opinion on. This TedTalk: “The way we think about charity is dead wrong,” also sparked my interest in re-evaluating my involvement in the social sector. In the end, regardless of whether or not you are a volunteer or a benefactor, it is always important to get well informed of the repercussions of the organizations you’re supporting.

To engage in the issue of poverty is already a noble feat, but being able to --- take off those rose-coloured glasses --- rethink your model of change --- adapt it with newly acquired knowledge, is what separates the organization that "means well" and the organization that "makes a difference." Even at Sauder Africa Initiative, we take the effort to get new perspective and evaluate our program's presence and impact here in Kenya. 

Other than that, we've been taking it all in and having a wonderfully, challenging experience. Here's some of our teachers and students from the Kibera Class of 2013!