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29 February 2024

How technology drives charity

By Luk Van Wassenhove

Fourteen days following the earthquake that shook Haiti on Wednesday, January 12, 2010, a further survivor was miraculously pulled from the wreckage. Notwithstanding, news about the disaster had left the main headlines of national and international newspapers and in many cases had been relegated to the "other news" section.

The focus of the response had shifted to longer-term goals such as sheltering people before the hurricane season and ultimately rebuilding the country. The crucial window for aid appeals, fundraising events and pledges had all but closed.

In terms of donation mechanisms, the response to the Haiti operation was unprecedented. In addition to traditional donation methods such as cheque, cash collections, telephone pledges or workplace giving, technological advances made the donation process easier than ever for those wishing to give. Appeals via websites such as Facebook and Twitter yielded support from a previously untapped source of funding.

Similarly, the phenomenon of text-a-donation was used to great effect by organisations such as the American Red Cross who managed to raise $29 million (Dh106.5m) by this method alone. By January 26, private donations to US relief organisations in aid of Haiti had reached more than $470m. In terms of financial aid, it was comparable only to the Asian tsunami if 2004. As the Chronicle of Philanthropy observed, this outpouring of generosity surpassed the amount given to US relief groups in the first 10 days following September 11 ($239m) and the Asian tsunami ($163m). Meanwhile, as figure 1 illustrates, international pledges had exceeded $260m, not including private donations or funds raised by high profile events or concerts.

Even taking this into consideration, Sir John Holmes, Under-Secretary-General for Humanitarian Affairs and Emergency Relief Co-ordinator, speaking at the ministerial meeting on Haiti, January 25, stated that although the flash appeal for $575m had been well supported, it constituted just 47 per cent of the needs. The flash appeal is a one-off consolidated appeal launched by the Office for the Co-ordination of Humanitarian Affairs (Ocha), in response to large disasters such as Haiti. With so many mechanisms in place to donate, and so many estimates of how much is being given, would it be possible to obtain an accurate overview of how needs were being matched? And indeed, who was matching them?

In figure one, the volume of donations pledged for victims of this unquestionable tragedy raised serious questions not about how people were sending donations, but rather how they were being received.

According to the World Disasters Report, the response effort to the Indian Ocean tsunami was funded to the tune of 475 per cent.

Indeed, Felix Salmon, writing for Reuters, pointed out that the Red Cross had spent just 87 per cent of their $3.21bn tsunami budget. In that same year the response effort to the ongoing complex crisis in Djibouti was funded to the tune of just 39 per cent. Figure 2, taken from the report shows that the top three humanitarian appeals of the year were on average eight times better funded than the bottom three appeals.

The United Nations' humanitarian portal ReliefWeb keeps a page updated with ongoing crises and appeals.

However, most of the crises found on the website are not mentioned in the international media on a regular basis. To compound this problem, donations are earmarked to one disaster. One example of this was the annual celebrity football match organised by United Nations Development Programme to aid the developing world. In the wake of the Haitian disaster, it was decided to direct all funds raised by this event to the Haitian response effort. Funds earmarked for a particular disaster cannot be reallocated to another operation without the consent of the donor.

In figure two, humanitarian relief and development organisations have multiple programmes in operation at any one time to cope with on-going relief and development needs including: Darfur, where according to the International Committee of the Red Cross, more than two million people have been displaced; or the Democratic Republic of Congo where in 2009, people were dying at the rate of 45,000 per month due to illness or disease, and a total of 2.7 million people had died since 2004.

These regional crises are compounded by global problems such as hunger.

The World Food Programme estimated that at the beginning of 2010 a child was dying from hunger or related issues every six seconds. This equated to 201,600 children every two weeks.

Without the intense media attention afforded to disasters such as in Haiti, it is difficult to maintain the level of funding required to deal with these ongoing issues.

Humanitarian organisations are dependent on funding to operate every one of their lifesaving operations. Earmarking donations to one specific disaster can have a negative impact on these organisations' capacity to adequately deliver all of the programmes in their portfolio.

Enabling organisations to manage their funding according to overall needs while employing systems that ensure better accountability as to how these funds were spent is one option to avoid the imbalances in funding seen in the wake of the tsunami.

In the aftermath of the Haitian earthquake, examining the positive and negative lessons from the past is important to ensuring funding is used most effectively to respond to needs of the Haitian people as well as those needing assistance around the world.


- The author is a professor of operations management. Researcher Orla Stapleton also contributed to this article, courtesy Insead Knowledge


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