PSI Ranked Top U.S. Charity by GiveWell

NEW YORK, NY, Dec. 18, 2007 — PSI has been named as the top-ranked non-profit organization in the U.S. by www.GiveWell.net, a charity research group started by two 26-year-old former Wall Street professionals. In its evaluation of more than 50 major charities, GiveWell found that PSI saves a life for every $250-$1,000 it spends, “roughly 3-4 times as good as other strong charities.”

Says GiveWell at www.givewell.net/cause1: “PSI has the most strategic, systematic, well-documented approach of any of our finalists, and its programs are among the most cost-effective. We recommend it above the others.”

“PSI simultaneously runs programs that appear as cost-effective and well-monitored as anyone else's, and impresses us most as an organization — in terms of its rigorous self-documentation, commitment to transparency, and coherent overall strategy.”

“We estimate that it costs PSI $150-$2,000 to prevent a case of HIV/AIDS and $500-$2,500 to prevent a death from malaria; across the organization, we estimate that it costs PSI about $250-$1,000 to save a life. These estimates do not include other benefits of PSI's activities, such as preventing unwanted pregnancies and reducing non-fatal malaria infections.”

The group was started a year ago when Holden Karnofsky and Elie Hassenfeld couldn't get a clear answer to a simple question: "Where should I donate?"  So they left the finance industry, raised over $300,000 from their former coworkers and created what the Chronicle of Philanthropy calls a "new, more open kind of charity."
 
Their research draws heavily on charities' internal reports of program execution and outcomes — reports GiveWell gained access to by inviting charities to apply for $25,000-40,000 grants through its grantmaking arm, The Clear Fund. GiveWell is the first organization to publicly publish charities' internal reports, as well as the first to rank charities based on their activities and outcomes. Karnofsky and Hassenfeld have been highly critical of other charity evaluators, which they say look only at "how good a charity's accounting department is — completely ignoring what the charity does and whether it works."  

"Rating a charity by how much it spends on administration is like rating a movie by how much it spends on actors.," says Hassenfeld. There isn't any other kind of business we expect to do great work while skimping on administrative costs — administrative costs mean people, planning, technology, and all the things you need to crack tough problems."

A few days after getting the top ranking by GiveWell, PSI also received the whimsical "2007 Holden Award for Excellence in Imperfection" for being the first charity on GiveWell's website to make a negative correction to its review and "in recognition of its honesty, humility and recognition that getting the truth out there is more important than looking good." The award comes with a $500 donation from Holden Karnofsky's own pocket and "means a lot now that I no longer make a hedge fund salary." The award was given after PSI notified GiveWell that some of the figures being reported for its number of cases of AIDS averted had been reduced due to improved techniques for measuring the impact of PSI's HIV prevention programs. http://blog.givewell.net/?p=202

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