Section 5.1 discussed a number of structural issues with private donors’ ability to sanction organizations by withholding funds, including the large number of donors and the relatively modest amount of each individual donation. Sections 5.2 and 5.3 were in some ways examinations of private donors’ incentives to sanction; sanctioning would be more likely if donors were dissatisfied with the performance of the organization to which they donated. The generally rosy picture that donors painted of the organizations to which they contributed, combined with the overall lack of in-depth analysis conducted by donors, would suggest that they have little incentive to engage in sanctioning, and in fact this appears to be borne out empirically.
Only 19% of donors contacted their organization with a question or comment after their donation, and only 17% contacted an organization after donating with a concern. Furthermore, 83% classified themselves as “Extremely likely” or “Very likely” to make another donation to the organization to which they had already donated (Figure 5-8).
5-8 Donor Interaction With Organizations After Donating
Yes 19% No
81%
Did you contact any of the
organizations to which you donated
after making your donation with an …
Yes 17% No
83%
Have you personally ever contacted an
organization to which you donated
about a concern regarding your
donation or their activities?
51% 32% 11% 3% 3%
How likely are you to make another
donation to the charity or non-profit
organization you most often donate
to?
Extremely likely Very likely Moderately likely Slightly likely Not at all likely
Just because donors haven’t for the most part contacted organizations doesn’t mean they wouldn’t, particularly since there is so little seeming dissatisfaction on the part of donors with the organizations benefiting from their donations. What happens, however, if donors come across information that reflects negatively on the organization? Would they then have an interest in attempting to contact the organization or possibly withhold future funds?
There is some evidence that donors would in fact be in favor of more sanctioning type behavior under these circumstances. Survey respondents in Groups I and II were presented with the following statement:
On March 9, 2010, the NY Times reported on a United Nations Security Council report that up to 50% of
food aid sent to Somalia by the World Food program was diverted to a "web of corrupt contractors, radical
Islamist militants and local United Nations staff members" ("Somalia Food Aid Bypasses Needy, U.N.
Study Says"). Please answer the following questions relating to this report.68
The respondents were evenly split between those who were already familiar with reports of this nature on the diversion of food aid and those who were not: 51.8% reported that they were previously unaware of this type of diversion, while 48.2% had some prior familiarity with this type of information.
After reading this blurb, respondents were then asked to characterize their reaction to the information. A portion of the respondents, 45.2%, were permissive of the aid diversion. Some (7.8%) were not concerned with food diversion and assumed that it was a part of normal operations, while 37.4% found it regrettable but thought that the need to continue delivering aid
68
New York Times. “Somalia Food Aid Bypasses Needy, U.N. Study Says”. March 9, 2010. Available at http://www.nytimes.com/2010/03/10/world/africa/10somalia.html. Accessed May 15, 2012.
was more important. The rest of the donors were less tolerant; 33.1% felt that if the food diversion could not be stopped then aid organizations should consider suspending operations, while 21.8% indicated that they found the idea of food diversion completely unacceptable and advocated the immediate cessation of aid operations (Figure 5-9).
5-9 Response to U.N. Food Aid Diversion Report
It is the latter two categories of responses that would be most troubling to aid organizations, and much of the reason why they try to prevent this type of information from being publicized. Their fears may be well-founded: respondents were subsequently asked how this type of information may affect their likelihood of making a donation to a group which provides food aid to Somalia, such as the World Food Program, operating under the assumption that they were initially inclined to make a contribution. More than half of the respondents – 54% - indicated that this information would mean that they would be very unlikely to make a donation or would absolutely not make a donation. Slightly less than one-third responded that they would
8%
37% 33%
22%
How would you best describe your feelings
about the findings of the UN report?
These types of diversions are to be expected
Food diversion is regrettable but it is more important to continue delivering aid to those in need
If the food diversion cannot be stopped, the organizations should consider suspending operations Food diversion is completely unacceptable and the organizations should stop their operations immediately
be slightly less likely to make a donation, while the remaining individuals said that it would have no impact on their decision (Figure 5-10).
5-10 Change in Likelihood of Making A Donation Due to Information on Food Diversion
Under this scenario, donors would in fact attempt to stem negative outcomes from aid – in this case, food diversion – if they had the necessary information available to them. Reports of this nature can also help overcome the collective action problem, since widespread media reports can by a type of systemic shock which can lead to collective outcomes from uncoordinated responses if each person reacts similarly to the report. In this case, there is some indication that possibly half of the aid donors might withhold their donation if they knew of the aid diversion which was occurring as part of the relief effort in Somalia. This reinforces two points: the first is that donors, if they have the necessary information, may in fact be motivated to engage in sanctioning behavior. However, due to the lack of incentives to procure this information and the way donors heuristically rely on organizations’ reputation means that they don’t expend the efforts necessary to inform themselves.
It would have no impact on my decision 14% I would be slightly less likely to make a donation 32% I would be very unlikely to make a donation 27% I would not make a donation 27%
Assuming that you were considering making a donation, how would this information change, if at all, the likelihood that you would make a donation to a group
which delivers food aid to Somalia, such as the World Food Program?
Secondly, this explains the premium organizations place on avoiding these types of negative reports. Their first preference should be to avoid having this information come out at all, but if it must come out, then it would be best to be limited to limited groups of individuals. These limited groups will have a difficult time organizing a larger response due to collective action issues. If, however, the reports are widely disseminated, then these coordination problems become less important and it becomes more likely that donors will seek to punish the offending groups.