Risks Worth Taking

The hot question that Paul Brest addresses in his recent Stanford Social Innovation Review article, “Risky Business,” is: How much risk should philanthropy tolerate in allocating scarce resources? He asks, when is the goal of maximizing impact best accomplished by high-risk investments where the likelihood of success is small and difficult to quantify (for example, advocacy), and when is it best accomplished by low-risk investments in interventions that have been proven to work (for example, a circumscribed direct service program)?

Brest contrasts the risks of two kinds of philanthropic grantmaking. He explains that an advocacy campaign to persuade a public utilities commission to adopt renewable portfolio standards is high risk, because success cannot be predicted or proven with randomized controlled trials. A program to reduce teen pregnancies through a well-evaluated peer-counseling program, on the other hand, is low-risk because the intervention is sufficiently circumscribed and standardized; it can be proven effective with randomized trials. While all of this is quite true, the analysis is incomplete. Brest does not acknowledge the costs in foregone impact of the low-risk strategy of choosing among only proven programs. He fails to explore the possibility of realizing more powerful results by drawing on interventions that have a high probability, but not certainty, of effectiveness.

A funder seeking to significantly reduce teen pregnancy would build on the best of current research and experience to combine the proven peer-counseling program with other efforts that target teens vulnerable to early childbearing, including:

• Promoting a strong connection to high quality schooling
• Making appropriate contraceptive services readily available
• Strengthening a culture of personal responsibility regarding sex and childbearing

This more inclusive strategy would mean contending with some of the very impediments to certainty that attach to the advocacy strategy. Like advocacy, efforts to reduce teen pregnancy are likely to be most successful to the extent that they do not rely on any single proven program. They are likely to be based less on a recipe than on “the accumulated knowledge of master chefs,” less on a predefined track and more on a non-linear ability to adapt to new knowledge and lessons learned.

Granted that when an intervention consists of several promising strategies, each operating under different auspices and customized to specific contexts, clear proof of effectiveness is harder to come by. But it does make greater impact much more likely. The tradeoff that Paul Brest does not explicitly acknowledge is between interventions that achieve lesser outcomes but offer elegant proof, and those that are designed on the basis of credible and probable evidence that is short of proof, but are likely to achieve stronger outcomes.

Since Brest ends his article with the declaration that taking appropriate risks may be philanthropy’s highest calling, I trust he would agree that even when philanthropists fund programmatic interventions, they should resist the seduction of certainty; they should run the manageable risks that accompany innovations and strategies that may not allow for clear causal attribution but are likely to achieve more ambitious results.

Read more stories by Lisbeth B. Schorr.