Three cautions about data

Luc Tayart de Borms

Alliance’s making the issue of data central to this edition is very timely. Few people will doubt or question the importance of data in our professional context. I am sure this ‘new asset class’ will be in the centre of discussions in the philanthropic sector for the next few years. As is often the case, though, when a new item is put on the agenda, there is a danger of overpromising. Let me just counterbalance some of what is written here with three warning flags, each under the heading of a quote of Einstein.

‘Perfection of the means and confusion of the ends seem to characterize our age’

So that we don’t have more and more surveys dropping into our mailbox, it is vital that we reflect in advance on the use and added value of the data being gathered. Data gathering is expensive in terms of both budget and time allocation. It is important that everyone in the sector grasps this and uses data gathering carefully, avoiding overdose and mindful of budgetary trade-offs.

The danger is that surveys ask for too much data, forgetting that in reality only a few are needed for advocacy and policy purposes. It is also easy to forget that data are often relevant only if one can compare them year by year. This means that data gathering needs to be structurally embedded in an organization and that the budget needs to be guaranteed for more than just a one-off exercise.

Along the same lines, if one pleads for transparency in the foundation sector, there should be an agreement about what really matters in this debate. We should avoid creating ‘transparency about trivial matters’, as Phil Buchanan of the Center for Effective Philanthropy has put it.

‘Information is not knowledge’

It is of course a no-brainer to say that using data can simplify reality by looking at it through a specific lens. This can of course be very useful as long as we remain conscious of it. Data have to be put in a context and the real story of foundations is in the details.

Some years ago a European Commission study stated that European foundations were bigger in terms of endowment and expenditure than their US counterparts. This made sense only because the study looked just at US grantmaking foundations and not operating foundations, whereas for European foundations both were taken into account because there are no legal distinctions in Europe between operating and grantmaking foundations. This example shows that focusing on global data can sometimes become an intergalactic exercise and that the added value has to be carefully looked at.

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