There are more billionaires than ever before — and in the past few years, as they’ve come under more scrutiny, so has their do-gooding. Stanford’s Rob Reich has argued that we’re too eager to applaud the ultra-wealthy for donations that are often unjust. Amid public protests, museums have started refusing donations from an ultra-wealthy family, the Sacklers, that made their money off opioids.
Historian Rutger Bregman became a folk hero at Davos for ditching his prepared speech to call out his audience, saying, “It feels like I’m at a firefighters conference and no one’s allowed to speak about water, right? Stop talking about philanthropy and start talking about taxes.” Anand Giridharadas wrote a book on billionaire giving recently, stridently titled Winners Take All: The Elite Charade of Changing the World.
So I opened Raj Kumar’s new book, The Business of Changing the World: How Billionaires, Tech Disrupters, and Social Entrepreneurs Are Transforming the Global Aid Industry, expecting Kumar to be less than impressed with the new heavy-hitters diving into the world he has worked in for decades. Kumar is the president of Devex, a media and project platform for the global development community, and he has spent his career researching and writing about aid interventions in the developing world. But in contrast to the angry drift of recent discussions about philanthropy, his book strikes a more moderate tone — perhaps precisely because he’s taking the long view.
Before billionaire philanthropists showed up on the global aid scene (starting with the Gateses), he argues, the world of global poverty interventions was a mess of politically motivated, inefficient trophy projects with little accountability and no real interest in results.
Kumar makes the case that today’s aid is far more results-oriented — about outcomes, not about celebrities or good intentions — and he attributes that swing, in part, to the dedication of ultrarich givers like Bill and Melinda Gates or Dustin Moskovitz and Cari Tuna.
But that’s not to say that the changes are all for the good. He also demonstrates that being officially results-oriented is far from sufficient to actually get good results, and that the aid industry may have made the leap to a “results-driven” approach without knowing which results they value or exactly how to drive them.
I sat down with Kumar to talk about his book and where the aid industry is headed. This conversation has been edited for length and clarity.
A recurring theme in the book — maybe I’d go so far as to call it your thesis — is that there has been a sea change in the direction of caring about results and evaluating programs by their outcomes. But doing that turns out to be a really hard problem.
I think you’re right, that’s the thesis. We’ve gone from an industry that’s really been organized around good intentions to more of a competition for good results. We don’t yet know what that means.
There’s a lot of dysfunction that comes from this process of moving to results. You see suddenly a big explosion in randomized controlled trials, and then only later do we realize actually, maybe, they’re not applicable in all of these cases and they’re not the best tool. You see organizations going to things that are really short term and easily measurable and then maybe stepping back a little late and saying, “Actually, we should look at graduation models and longer-term investments.”
So it’s not a smooth path. But what I’m encouraged by is that if this becomes more of a competition for results and we’re heading in that direction, then we’re having the right conversation. Even if we’re getting some things wrong along the way, we’re heading in the direction where we’ll have more impact.
What drove the sudden shift toward a focus on results?
I think a few things were happening. You’re getting lots of outsiders who are becoming part of the development sector. Development issues are increasingly becoming front-page issues — like climate change, migration, refugees. Things that might have been talked about in narrow segments of the development field are now big public policy questions. I see lots more brand new initiatives, some of which can scale pretty quickly because there’s more investment and more competition.
And then you have a lot of corporate and investor interest and involvement in development.
Corporate involvement — that seems to me like the classic case where they care about PR, not results. It seems almost like a counterexample to the increased focus on results.
We still have a dynamic where you get a lot of praise where you announce something, and you get a lot of praise when you say you’re doing something good. That is happening today, and you can get away with that today. Often with corporations, you see a lot of emphasis on their donation scheme [donating a dollar for every sale, for example], not on results.
But I think there are examples of companies that are achieving things at scale. I almost think the activists of the ’70s and ’80s who were really pushing and protesting companies — in some ways, what we’re seeing now is their success. The accountability is not fully there yet, but it’s far further along than it ever was. The percentage of companies that now have a report they publish that adheres to global standards about how much they’re achieving — that’s a big step forward.
One interesting argument you make in the book is that if we’re contrasting accountable transparent philanthropy with unaccountable shadowy billions, you can’t really characterize government aid as accountable and transparent. You argue governments made decisions about where to spend their money for basically idiosyncratic reasons.
It would be nice to imagine that government aid even now is perfectly results-oriented and transparent and accountable. It’s not. Politics and foreign aid go hand in hand, and most aid goes to the most politically salient issues — so in Europe, stemming mass migration — and then the foreign aid structure today is just so risk-averse that it hampers its effectiveness.
As somebody who’s involved in effective altruism, I was pleasantly surprised to see effective altruism feature somewhat prominently in the book, as part of the transition to a new, results-driven aid. I’m sort of curious as somebody who’s been working in aid for decades, how have you seen effective altruism influence what everyone is doing?
I find that most people who’ve been working in the aid industry a long time get annoyed by the effective altruists. And I think that’s actually been positive. I think it’s led to a real debate, and we need that debate.
Development philanthropy has been way too cozy. And I think the effective altruists have asked really tough questions. They’ve been kind of zealots, in a way, for their viewpoints. I don’t fully ascribe to everything effective altruism believes, but I think their basic core tenets — that we’ve got to focus on priorities like where can we have the most impact, doing things now versus later — is an actual difference. Those kinds of very basic ideas are influencing our field.
And certainly, being able to push tens of millions of dollars into really highly effective health interventions — that makes a big difference for the organizations doing that work. And it starts to move the whole industry. People sit up and take notice.
You argue there’s a very powerful sense in which billionaire philanthropy represented a big increase in accountability — compared to what came before it, which was an industry with very few stakeholders.
The aid industry was really small and narrow. It was USAID [the United States Agency for International Development], and some NGOs and universities in the US. And the goal was much less about actually doing development and actually changing people’s lives. It was much more political.
Then you had Bill Gates and Melinda Gates coming into the picture with huge sums of money — government-level aid budgets — and saying, “We actually care about data, we care about evidence,” and increasingly, you have other billionaires coming out with similar viewpoints. That starts to shift the market a little bit. The NGOs doing their work have to be able to answer tough questions about what kind of evidence you have for your programs.
Results really matter now.
So billionaire philanthropy is good?
Billionaire philanthropy is a good problem to have.
We do need much more transparency and much more accountability, because we’re about to see potentially a tidal wave of funds coming from billionaires into the nonprofit sector. So if we can get the right rules for the road, we can actually shape that to have a real impact. It’s not about giving a pass to anybody.
Sign up for the Future Perfect newsletter. Twice a week, you’ll get a roundup of ideas and solutions for tackling our biggest challenges: improving public health, decreasing human and animal suffering, easing catastrophic risks, and — to put it simply — getting better at doing good.