The mysterious art and science of doing good
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Welcome to the LSE Events podcast by the London School of Economics and Political Science. Get ready to hear from some of the most influential international figures in the social sciences. Good evening, everyone. It's a great pleasure for me to welcome you to this event and to welcome also our online audience, which I understand there's a substantial amount.

I'm Julian Le Grand, I'm a professor from the Marshall Institute and I'm chairing this event. This event is part of our inaugural lecture series, the LSE's inaugural lecture series of our professors.

There's a special moment in the school because it's a special moment for an academic's career, it's a special moment for the school as a whole. It's academics who have just been promoted or academics who have recently joined the school. So I'm very glad you're able to join us as we celebrate one of the successes of our community, Professor Jonathan Roberts.

Jonathan is a latecomer to academia, which make it all the more remarkable when you see what he has achieved as an academic. After getting a classics degree at Cambridge, that's a small university north of London, you've probably heard of it somewhere, he...

He worked for several years in the third sector for charities dealing with children for disabilities. He then did a PhD at the Department of Social Policy at the LSE where he did sufficiently well to achieve the Richard Titmuss Prize, which was quite a prize given out for the best dissertation in the department in that year and a remarkable piece of work it was too.

And after a spell of teaching in the department at UCL, he then joined the Marshall Institute where he's the teaching director.

And he's the chief person responsible for our path-breaking MSc at the Marshall Institute, an executive MSc in social business and entrepreneurship. And he's also responsible for developing the social impact stream of the Masters in Public Administration for the School of Public Policy.

I must add in passing that his teaching gets impressively positive student feedback and he's been recognised with several multiple teaching awards from the LSE. His research is equally impressive. It ranges across a wide range of what we at Marshall call private action for public benefit, including work on ethical consumerism,

strategic philanthropy, and the ability of hybrid organisations such as mutuals, social enterprises, purpose-driven corporations and so on to help resolve social problems. And this, together with his experience of working with charities, has led him to do some fascinating insights into the mysterious world of altruism and doing good.

and he's about to tell us about those. He'll speak for an hour or so and give me plenty of time for questions. So, Jonathan, without further ado, over to you. Thank you. Thank you so much. It's a really great honour to be the first professor appointed into the Marshall Institute.

It's a really great honour as well that Julian is chairing this event. Julian is a remarkable intellectual. He's also been a great mentor, colleague and friend for me, so it's very meaningful that he is here with me tonight. I'd also like to thank

Professor Stefan Chambers and the whole team at the Marshall Institute. There's a well-known saying, if it takes a village to raise a child, it takes a university to develop a professor. I'd also like to thank very deeply my extraordinary partner, Dr Vanessa Ogden, without whom none of this would be possible.

So tonight we're talking about doing good. Normally I would start with a bit of a quip or a joke. That's coming, don't worry. But I think it's a sombre moment and therefore the start has to be a little bit sombre. This is a very tough time for those organisations and institutions which seek to do good outside the state and the market.

Of course, most dramatically, there has been the extraordinary and sudden cuts in funding through USAID, which has remarkable repercussions. But it's also just a tough time because governments are increasingly finding it hard to find the funds to provide basic public services.

And the third sector tends to find itself in the middle. It finds itself both short of funds but trying to do much more. And at the same time, these sorts of organisations are, of course, under the same sort of pressures that all other organisations are in our society. The advent of AI, for instance, is both a remarkable opportunity

for organisations to do good, but a remarkable addition of complexity and sometimes threat to their work. So it's a tough time. And all the more reason therefore to consider and think about very carefully how we do good, because I think how we do good is going to become increasingly important and significant in our societies.

See what you think about this term. Just let it sink in for a moment. What do you think about it? For some of you, you may be entirely comfortable with it. For others, there's an essential oxymoron, a tension going on here.

Isn't philanthropy in its original meaning, as Samuel Johnson defined it, the love of mankind, a motivation to do well for people? And profit, isn't that something self-serving in a different sort of sector? And yet, while we might have that discomfort, I could replace that with the term impact investing. And it would be more or less the same thing.

And impact investing is a very legitimate, very popular, very new movement and attempt by investing in the market not only to make profit but also to do some good in the world. And these sorts of terms and these sorts of riddles are something I've been trying to crack through my career.

You might think that this is a term I just invented to give an introduction to this lecture, but actually no, I have borrowed it from this remarkable chap. You will know him as Hugh Jackman, although the connection, the...

The resemblance is not perfect, I have to say. But that is P.T. Barnum. And maybe not only did he invent the circus, but he invented impact investing. Because P.T. Barnum coined this phrase, profitable philanthropy, when he attempted to create a whole new city in Bridgeport on the east coast of the US. His plan was wonderful. He would...

purchase a huge amount of land and much of it he would give away at a very, well he would sell at a very discounted price. Not only that, he would give very, very cheap loans to people to build their businesses and their homes on this land. So you could call it early social housing. And then his plan was he would keep some of the land in reserve and when this was a flourishing popular city he would sell it at some wonderful profit.

but he was insistent that his primary purpose was to do good, the welfare of his fellow men. So that's his idea of profitable philanthropy. Needless to say, because this was P.T. Barnum, he lost all his money. But it's an intriguing story, and I just want to set up a contrast with...

this gentleman and I'm pretty confident, you never can be sure, but I'm pretty confident that Seneca the Younger and P.T. Barnum have never appeared on the same slide in an academic lecture before.

But note what Seneca the Younger said in the first century CE. He said, it's absolutely disgraceful, it's a transgression, it's a sin to regard any situation where you seek to help someone as an opportunity for investment. It just completely conflates two things which should never be conflated.

And it's this sort of riddle that I want to investigate further in this lecture. So what I'm going to do in this lecture is explore the complicated world of doing good, but in particular use two new sets of ideas which have come into this sector as our sort of lens, as our anchor point for discussing what it is to do good well.

When I say new, there could be a lot of dispute about that. These sort of practices, which I'm going to introduce in a moment, have been around, floating around in the sector for a long time, but the intensity of their application has been really significant in the last 20 or 30 years. So that's why I'm describing them as new.

The two trends which I'm going to explore more in a moment are first of all a really intensive focus on rigor and outcomes often drawing on the sort of procedures and techniques you will find somewhere like LSE but also the importation of business and market practices into this world.

Part one of this lecture, I'm just going to frame this question a little bit. And then in part two, I'm going to go through certain riddles, certain areas of contestation which the importation of these techniques creates. Inevitably, this is going to be a very broad survey. It's not going to go in depth, but I'd just like to spark some questions

questions and thoughts, maybe a little bit of controversy about how we do good on the basis of these trends. To start with though, any good academic lecture has to start with a definition, of course. And what does it mean to do good?

Well, what I mean by it, and that's, I guess, the important thing for this lecture, is private action, so it's not the state, undertaken intentionally, so we have a real purpose to do this, to create public benefit. So public means not for our family, not for our own interests, but for the general community, and the intentional motivation is this is not a side effect, this is the real thing that we were trying to do.

And quite obviously, therefore, I am not initially talking about the market. Because the whole point of the market is you act in your self-interest to gain profit and through the marvellous mechanisms of the invisible hand, competition, price and so on, somehow that self-interest creates social impact and public benefit.

So because of that motivational difference, intending social benefit on the one hand, intending personal profit on the other, there is a real difference between doing good in my sense and the market. So our focus is here not so much individuals giving or volunteering, but the institutional world of doing good.

which we typically call the non-profit sector or the voluntary sector or the third sector. I have a real problem with these terms. They can sometimes be useful, but actually I see them as a garbage can.

So anything that isn't in the state, anything that isn't in the market, just gets thrown into this garbage can of the third sector or the non-profit sector. And what that actually does is disguise a huge amount of diversity of behaviours, of meanings, of processes. And if we're truly to understand how we should do good well and also what the impact is of these new trends,

then we have to understand the diversity and not simply talk about the non-profit sector. So if you don't mind, we're going to dispense with that term. Now this is my view of this institutional world of doing good. You will all have your own view. You will want to add perhaps certain dimensions to it.

But let me go through these very, very quickly because it's important for our future discussions. The first is something that I'm calling the high impact sphere. And this is where you have large amounts of sums of money often coming from philanthropic foundations

into formalized nonprofit organizations which are trying to take forward some sort of very important social innovation which has the capacity to go to scale. So that's what I'm calling the high impact part of doing good. Then of course there is humanitarian relief where we're not so much dealing with social innovation as responding to suffering as it happens, a very important part of our sector.

Then we have civil society that has many, many definitions. I'm using it tonight to mean the world of activism, of campaigning, of seeking political change, the area of discourse and discussion.

then I think one of the most overlooked areas of doing good is simply doing services again and again to the best of your ability. Sometimes I think we focus too much on social innovation and not enough on simply doing services really well when we're doing good, like schools, like care homes and so on. So just the area of service provision.

And finally, the area of community, of coming together, of civic engagement, of...

trying to solve some of the disputes and divisions that are between us. The idea of coming together, sometimes in a geography, to cohere. So I think when we're saying, do these trends have a good or bad impact? Are they useful or are they not useful? The very first question we have to ask is, well, what part of the sector are we talking about? What part of this sphere of doing good are we working in?

If you take a course on voluntary sector organisations, the non-profit sector, one of the foundational pieces of learning you will experience is the problem of a lack of external governance in this sector. Now, by that I don't mean that organisations in this sector are not scrutinised, they're not under pressure.

But what I mean is there are no real feedback mechanisms that naturally occur to these organisations, this group of functions that I've been talking about.

So, to put it in the jargon, there are no clear signals which enable organisations to understand whether they're doing well or not, and no obvious incentives to push them in the right direction. So in the markets, you get feedback from your customers, you have price to push you in a certain direction. At least for the States, there is some kind of

feedback mechanism through a voter, but in the sphere of doing good, there are no such mechanisms. And that does lead to this challenge, and I think it's a challenge which you can sometimes see as a reality too, that there is a great motivation to do good, but sometimes the effectiveness of doing good, the impact, is somewhat lacking, simply because you don't have these signals in place.

The other difficulty that this area of action has is simply there are insufficient resources to achieve all that actors want to achieve. So the states can enforce taxation, the market has huge resources generated through buying and selling, the charitable sector, philanthropy, civil society does not have these resources.

So perhaps because of this real or perceived weakness in this area of action, we see other ways of acting, other frameworks coming in to try and create remedies. And this is why I think we get these new approaches to doing good. Let me just briefly outline them to you.

On the left-hand side, you have this idea of a focus on rigour and science and outcomes and some of the features I've defined there. So a real...

what we might call a top-down, sometimes natural science approach. In other words, you have a hypothesis, you test it, you see whether there's some sort of causal attribution you can make to say that this particular social intervention is having the results that we want. You might also use some sort of calculation to work out is this area of action, say a particular disease,

more worthy of my intervention than this particular disease or area of action. So it's a very, very systematic approach to doing good. On the other hand, you also have the intrusion or the entry of market and business mechanisms. So in its purest form, using market trading and commercial systems in an attempt to achieve social purpose.

But even if we're not trading, we're using some of the techniques. So we're using techniques such as branding and marketing and key performance indicators and these sorts of mechanisms. And you will note a little bit of overlap between these two systems. So the emphasis on quantification on outcomes is consistent across both of these.

So there are two points I would make about this. The first is what I would say is call an instrumental turn in doing good. I'm going to talk more about what it means to be instrumental in a moment, but more or less it means not so much focusing on the end point as really focusing in a laser-like fashion on how we can do better, how we can use better means to get to where we want to go.

The second thing I want to mention is drawn from sociology and it's the idea of transposition. The idea that we can take a whole set of ideas and thoughts from one area of social action, say business, and put it into the area of charity.

And this does happen, and it's a fascinating phenomenon. Normally, there is some kind of possibility, even probability, of really interesting innovation and opportunity coming when you put those ideas together. But what we can also be certain of is that this will create anger and disquiet. Because if you think about the business sector,

You're bringing in ideas of efficiency, you're bringing in ideas of very quantitative targets into the charity world where, while those things can be important, more often it's about care. It's about intangible quality. And so you can get a lot of friction. I could say that both these trends are somewhat cold. So the idea of science is about objective, impersonal pursuit of the truth.

the idea of business is about a somewhat impersonal attempt to get profit. And that feels somewhat at odds with this idea of doing good, of charities and so on. So often the response to the intrusion of these trends is hostility and anger and then equal anger and defensiveness from those who are bringing these trends into the sector.

And what I wanted to think about for this lecture is how we can in some way get beyond that sort of fury and think about this a little more systematically.

So I'm using a frame of instrumental rationality for this analysis. What that means in the first instance is something very, very simple. Instrumental rationality in its purest form means simply what is the best way that we can get from A to B? And if B is some sort of social impact or social change or some sort of better life for people,

what is the best means we can use to achieve those ends? So that sounds all very simple, but it is of course more complicated because it could be that even though we are finding a better way to get from our A to our B,

we are missing out on something in the process which could be beneficial. So there's actually almost an end within the process. By going from A to B in a certain way, we are missing out on that beneficial part of the process. Or it could be that there's some other end that we haven't really noticed and we are harming that other end. Now, those are quite technical things

perspectives and I'm going to invoke them along the way. But what I should mention too is that this term instrumental rationality is also something that deeply concerns a number of philosophers and sociologists. And it is in this context, particularly referring to the very scientific and market-based techniques that I have referred to, the idea that they almost become systems of meaning in themselves.

and that in this context the means actually begins to take over from the ends and the science becomes a thing in itself, the market becomes a dominant set of meanings in itself and that

disturbs what is called substantive rationality, the arena of values, of judgments, of working out what our ends are. I'm not going to delve too deeply into that area, that criticism of instrumental rationality, but please do bear that in mind. Okay, so that's the preliminary. What I'd now like to do is dive into some of these riddles using that framework.

This, of course, is by no means a comprehensive list of the challenges that one faces in doing good. There are many, many others I could have added. I had a long list, I had to shorten it down. The one big one I think is missing here is the riddle of government and how when you're doing good, you interact with government in so many ways. If you're a philanthropic foundation, if you're a non-profit organisation, if you're a social movement.

That didn't fit neatly into the particular question I wanted to answer tonight, so I haven't included it, but that's a very vital thing to consider. So again, I'm going to go across these things very broadly and speedily. There is so much more detail that one can go into around these riddles of doing good. The first riddle I want to explore is the riddle of the market.

Now, I've already indicated that the market is actually the realm of not doing good. It's the realm of intentionally following your own self-interest and then any social benefits are an incidental effect of that. So what we're trying to do here is reverse that motivational polarity and say, if I am someone whose primary instincts and motivation is to do good, can I actually use the market?

to reach the end that I desire. And in fact, there are multiple and diverse ways in which actors are attempting to do that. I can't possibly go through all of them tonight. So what I'm going to talk about is just one single example and perhaps one of the biggest and most powerful.

which is, can people who have a focus on social impact do good by creating new markets for social goods? So the thesis is this, and we're in the realms here of impact investing as the financing source, social entrepreneurship as the actors who are putting it into practice. So what we're trying to do, as I mentioned, is create sustainable market provision

particularly in emerging economies, but not exclusively so, for social goods to disadvantaged or underserved populations. Now, there can be, I've experienced when I'm teaching, an understandable reluctance to think of the markets as the place we should go to help the poor.

Isn't that the role of government and indeed the role of charity or philanthropy? How can we rely on the markets? And I will address that in a moment. But I think it's always useful in thinking about such interventions to think about what is the counterfactual.

And often in some emerging economies, as a starting point, we can say there's no way philanthropy can provide goods on an ongoing basis. This came home to me when an entrepreneur, I'm going to refer to his organisation in a minute, said to me that he had actually gone into...

a rural area in sub-saharan africa and asked he was he was working for a charity at that time and asked people what do you really want from this charity what's really going to make it the one thing that will really make a difference to your life and they said to him i need a smartphone so the charity had been focusing of course on a lot of remedial work uh perhaps some cash transfers that sort of thing

but really what was needed was easy access to a smartphone. And to do that on a permanent ongoing basis, well philanthropy simply is not in a position to do that. And why not the markets? Well when you're dealing with disadvantaged communities, particularly in emerging economies, sometimes with a new technology, it's simply too risky for market actors to take up that market opportunity.

Often as well in these situations, although this is a controversial area, the government may not have sufficient capacity to step in. So in these cases, we see social entrepreneurs and impact investors entering to test a market opportunity. And the hope is that...

If you can prove that this market works, that a particular organisation can be sustainable, say in providing mobile phones to a disadvantaged community, then other actors will come in and you will have a sustainable market that is solving a social need. The social entrepreneurs and impact investors have an advantage on other actors

because they are prepared to take more risk and to accept less financial return. And that gives them the ability to take this opportunity. So for my former students, this is a story you know well, the story of M. Coper. Really interesting proposition, isn't it? And again, one that sometimes normatively we might find discomforting.

Shouldn't we do good again, not because we're incentivized by money, but because we're incentivized by altruism or humanity? But Jesse Moore, the co-founder of M-Coper, was very clear. What he was trying to do was everything. He was trying to benefit the environment, benefit the disadvantaged people in sub-Saharan Africa, and get richer at the same time.

Now, of course, you could say he's talking to multiple audiences when he says that. And if he's going to seek investors, then he's got to put in that pitch that there is wealth to be had. So the idea here was to spread the use of solar-powered generators because disadvantaged communities in sub-Saharan Africa were using kerosene, which was dirty, expensive, unsafe.

but the idea was to do this through a market through microfinance so people would pay a little bit in installments and get these generators but notice this we are creating public benefit through a profit-making company and it is a company that has shareholders who are expecting a return it's counterintuitive

Initially, the investment was from philanthropy, people who were not necessarily expecting any return, and yet philanthropists were becoming shareholders in this organisation. And also from development finance institutions, in other words, quasi-governmental institutions whose focus was impact and not on profit-making. Subsequently, mainstream investors have come in.

So what is the result of this intervention? Well, it has proved that there can be a market in this area. So many more people in sub-Saharan Africa now have access to solar-powered generators than was otherwise possible. And we see multiple companies coming in to deliver these solar-powered generators. M-Copa itself, and this is an interesting development, has now moved away.

from solar power generators and has actually focused on mobile phones. And sometimes that's discomforting because it feels like it's moved away a little bit, perhaps, from its initial mission. But then remember, what we're trying to do is spread the social impact of solar power generators, and we've done that. What subsequently happens to this organisation is less important. Although if I had Jesse Moore in the room right now, he would of course say,

financing mobile phones is the best thing I can do to financially include the disadvantaged into the financial system. So that's the story of M-Copa. Do we think it's a good means to an end?

that idea of instrumental rationality, trying to strip out our normative responses and to look at what has actually happened, well, we could have an emphatic yes. We could say we have created a market which has enabled scale and reach, which philanthropy and probably the government could not have done. We also get information on whether this is effective or not from the fact that

that people are buying this product or not. Remember that feedback is always difficult when we're giving a gift. We have also brought in resources from mainstream market actors. So we're bringing in extra money from regular investors when they see this is working. We've got regular companies coming in to give these sorts of goods. So we're solving for that problem of a lack of funds in philanthropy.

There's one other thing I would say from a public policy perspective, and that is some of you may know the work of Mazzucato or Stiglitz that

often we need government to intervene in markets, to be a neighbour of markets, to co-produce markets if they are in the public good. And this idea of market interventionism is something uncomfortable to those on the right, but something increasingly embraced by those on the left of the political spectrum. And actually, when you look at what's specifically happening in this case, philanthropy is doing precisely that sort of market co-production.

And even the terminology that someone like Mazzucato uses is precisely the terminology we use here, such as patient capital, catalytic capital, and so on. So what we could be looking at here in some sense is impact investors' philanthropy

stepping in for government when government is not sufficiently robust or strong enough to be that co-enabler of markets which Stiglitz and Mazzucato would like to see. So that's an interesting proposition and one that I'd like to explore some more. But of course we had to be careful here. There are certain conditions that had to be fulfilled for this to work.

The one thing simply is there really has to be a viable market. And so often when we are dealing with disadvantaged communities, failing markets, there really simply isn't a viable market. And I've seen significant philanthropic impact investing going into markets that really are never going to work, particularly in the health sector. But perhaps the deepest and more disturbing area is that

By creating markets, we are letting in self-interest into our social impact formula. Can we control that self-interest? And that was a big question with mCoper because you had philanthropic investors who had a social mission and were using their shareholding to make sure that mCoper stayed on that social mission.

But as soon as those investors sell to more mainstream profit-making organisations, will that social mission be maintained? So it will depend to some extent on whether there is an alignment between providing the goods and getting profit, providing the social value and getting profit.

But we also may need to think about some protections we build into these organisations to ensure that the commitment to social mission is maintained when mainstream market actors come in. And the other question is always, what about the poorest? There's no doubt to me that M-COPER served people who are globally very poor. But nonetheless, the poorest...

in communities they were serving were not being looked after. They did not have sufficient income or material wealth to be able to access these solar power generators. So there's always a difficulty that the market doesn't cover everybody if you're expecting people to pay for services. So what about the poorest? So I think there are reasons to think that

the market can be used to get from A to B and create some sort of social purpose, it meets question one. The second question, however, is: are there harms beyond simply getting from A to B? And I just wanted to present you with a few propositions about that, and you can see what you think. The first one I've already mentioned is that markets can tend to inequity.

So only people who have the right amount of money can participate in a market. Sometimes those who find it hard to make decisions or have some sort of particular disadvantage struggle to be capable actors in a market. And a market can be a difficult and hard environment. Then there's this idea of profitable philanthropy.

Looking at the poor through the lens of getting rich, how do we feel about that? Is it okay simply because we're getting from A to B, or does that diminish us in some sense, that we are beginning to push out our altruism and replace it with some sort of self-serving incentive? Does the absence state? For many criticisms of this sort of M-COPA process, there is the question of

not just that the state should be providing that service, but that this is creating a gateway for all such services to be privatised, or for a private market to provide most of our social goods. So in this sense, we see maybe the means becoming the ends. That would be a criticism. There is a final thing I wanted to say. I don't think I've got it on this slide, and that is...

a question of corruption. And the question of corruption is this: Are there certain goods which when you start providing them in a market are corrupted? They lose their essential meaning. And I don't think you can necessarily say that about a mobile phone or solar powered generator. But when you begin to talk about profit-making schools,

then maybe this becomes a little bit more complicated, schools being an arena of citizenship, of knowledge and so on. But let me tell you a very particular story which I think shows this point. There's an organisation which many of you might know called Crisis Text Line. And this is an organisation which does remarkable work within social media in supporting young people in particular who are having a mental health crisis.

and through both the use of AI and data analytics, but also real people typing away at the end of a WhatsApp discussion. It is supporting a lot of young people through a mental health crisis and in the worst instances preventing them from taking their own lives.

So, so far so good. But of course such an organisation is expensive to run. It's a non-profit organisation. So what Crisis Text Line did was set up a profit-making subsidiary in partnership with a profit-making firm. And it collected all the data that it had amassed in its calls with vulnerable people.

and use that data to train up software in order to help with companies trying to improve their customer service for which those customers would pay.

Now, in the jargon of social entrepreneurship, this is an attempt to monetise, to monetise your data, to create earned income so you can continue doing your social mission. I should add that all the data, according to Crisis Text Line, was anonymised, so there could be no harm to people from this. And there was some sort of somewhat convoluted consent process was there too.

But the moment Crisis Text Line, well, not quite the moment, but sometime after, there was an extraordinary controversy because people were saying, "You just cannot do this. "You cannot make money out of the data "of people who are experiencing a mental health crisis. "This is morally repugnant, whether there is harm or not. "So you have degraded your service

by monetising the data you receive.

The outcome was predictable. There were two or three days of crisis text line trying to say, "This is fine, no harm is done," before they had to do a very abrupt U-turn and shut down their participation in that company. There's an idea here that sometimes monetising markets can be corrupting of a good, corrupting of a relationship. Most of all, I think, corrupting of trust,

for non-profit organizations organizations that are doing good trust is often the most important currency they have as soon as you bring in a profit-making element to that then there are questions there are questions of why you are doing this um there's much more to be said about the market we can perhaps ask talk about that later i'm now going to move on to the riddle of knowledge so um

Some of you may know the book 'Doing Good Better' by Will McCaskill, remarkable book, do take a look at it. He's a philosopher from Oxford. And he said, "Too often we're afraid of thinking about doing good, because the very act of calculating or thinking about it seems to take away from our emotional authenticity. But we really need to think carefully and rigorously about how we do good." I couldn't agree more, we do.

But then there is a question of when we're thinking, whose knowledge do we use to make decisions and questions about how we do good? And I've got a list of all the knowledges that could be useful for us on that slide. And my sense is that the trends that I've been talking about push us to certain knowledges over others. They can push us to...

respecting rather too much the expert researcher, for instance, in terms of evaluating outcomes and thinking about how to design a project.

and of course the social entrepreneur is the idea that the businessman or woman has a certain essential expertise in getting things done so there might be a concern that we are moving a little too much to those earlier in this list and moving away from the user or the community stakeholder i should emphasize that mccaskill emphasize mentions very clearly the importance of the user but

but I'm not sure that is apparent in the trends that are coming through. So we have this interesting question of epistemic, in other words, knowledge, instrumentality. What knowledge do we need to get from A to B to do social good? We certainly can't always trust experts.

If you haven't read this book, do read it by Criado Perez. Quite astonishing. And it shows how apparently scientific research projects were completely biased because they did not take into account women. So the example on the bottom right is of crash test dummies, which cars were tested with dummies that were of a male physique and size.

As a result, and it took people a long time to realise this, the number of fatalities and serious injuries suffered by women were much, much higher than for men. It's quite extraordinary to think that this sort of process and this sort of assumption could have been going on at least in my lifetime and in many of yours.

The second example is of the piano. People wondered why there were so few female concert pianists. Of course, inevitably the human mind tends to go to some sort of morality or something like that, or human capacity. Maybe women just aren't up to it. But actually it was because concert pianos were designed for male hands and not for female hands. This is an example of you're using expert knowledge but you come up with the wrong result.

Clearly, again, thinking how you get from A to B, it's going to depend on the task that you are doing. There's a great organisation that I know which is trying its best to improve housing in developing countries so that it's resistant to earthquakes.

Clearly, you need expert knowledge to do that. In the first instance, the people you are trying to influence are also a certain set of experts. It's probably local builders, architects and also local government. But even in that sort of environment, I think you do need to talk to local communities as well. But you contrast that with something like the experience of deaf people, like me. I am severely to moderately deaf.

about their experience of a shop or something like that, you're trying to solve that social problem, clearly it is the user knowledge that is absolutely fundamental to understanding that social problem. So which knowledge you use is contingent on the particular task you are trying to do. I think also the process of gathering knowledge is important, something that

What concerns me in the field of social entrepreneurship is the lean start-up. I don't know how many of you have heard of this idea of a lean start-up. Taken from the business world, the idea is that you produce a prototype very quickly, you test it very quickly, rather than trying to design the most beautiful chair or table or motorbike and then find that the consumers don't like it or something else doesn't work with it.

Makes all the sense in the world in that context. And if done properly in the social sector, it can be a really useful tool. But I have talked to social entrepreneurs who interpreted it as, I've got a great idea and I'm going to jump out there and go and test it.

This is not the way to solve social problems. The way to solve social problems is a deep immersion in that social problem, in the lives and situations and dynamics of the people you are trying to help. But markets, strangely, can also be an asset.

sometimes when we are trying to get knowledge because simply through whether people buy something or not you can learn about whether something is useful or important or changing their lives. My final point here is that there are difference of emphases across different contexts but ultimately I think

Embracing every single knowledge in a project or an organisation is the best thing you can do. An organisation that I respect very deeply is Educate Girls. There are a lot of young women who are out of education in India and Educate Girls is trying to bring those young women back into the school system. So that's the mission.

And Educate Girls has used data analytics, an example of expert knowledge, in a most extraordinary way. They have used the data that they have collected in their first round of interventions to predict which villages will have the most girls who are out of education. And by doing that sort of targeting, you can save so much money and so much time.

And they believe that because they did that data analytics, because they identified which villages might be most useful to help, they have helped an additional 600,000 girls get into school. So that's an extraordinary example of how, yes, science, data analytics, bringing that into the world of doing good is extremely valuable. But at the same time, when they get into each village, they understand that

that the only way they're going to get those girls into school is to interact very deeply with the local people and the local culture and understand how particularly they can influence the local norms and so on. And they will employ volunteers from that local community because they have the local knowledge that is required to achieve success.

So you can see a remarkable mix between community knowledge, user knowledge and scientific knowledge. So that's about getting from A to B. But again, there is something more than getting to A to B. And this is the idea of epistemic justice. In other words, fairness. It's around our knowledge. So...

This really came through to me when I read a book by Paul Farmer. Some of you might know him as a remarkable social entrepreneur, physician, activist, who sadly died a couple of years ago. And what he said was, how was it that the voices of people of colour who had AIDS and who were women were never heard at all during the AIDS epidemic?

He suggested, I think quite rightly, that it was precisely because of those characteristics. People wouldn't listen to them because they were women, because they were of colour, because they were poor and disadvantaged. That brought home to me the importance of hearing people as an end in itself and not simply a means of getting somewhere. It's also absolutely true that in something like science,

there are hierarchies of knowledge, particularly in something like medicine, but also in my own field, social science, where the scientific method is privileged and the user voice is very low down on our list of things that we would say is reliable knowledge. It's subjective, it's anecdotal, and so on. So we have to be aware that we ourselves can do this sort of discrimination.

So there are ways of countering this when we're doing good. And I give him one example here, and that is trust-based philanthropy. So rather than philanthropy, which can be very much influenced by the scientific approach, having lots of top-down outcomes, lots of measurements, and so on, actually trust-based philanthropy has none of that influence.

builds up a relationship with the people it wants to give money to just gives over that money no outcomes no indicators but of course we may have attention here and there's one i'd love you to think about and comment on which is if we don't have monitoring and data how do we know whether we're doing a good job how can we learn what works and so there's an interesting um maybe it's a paradox maybe not but

ensuring a service is done correctly versus transferring power. One question is how often do those two things go together? If we transfer power to those who have the local knowledge, will that lead to better outcomes? We would like to think so, but I don't think we know so. So that's a challenge for research, but also an interesting tension to think about. Moving on to my third riddle,

This is a significant one in the realm of social science and that is the riddle of measurement. Now, I'm going to say something quite clear to start with and that is, I think, measurement is a good thing because the ability to know whether we are having social impact with what we do is just so important and it helps us cut through assumptions and emotion and biases and so on.

If we can really make a causal attribution, and this is something that tends only to be possible through something called a randomised control trial, then that's really fantastic because we have shown that any benefits in the local community, the people we're helping, are down to our intervention.

We don't always have to use an RCT, but we can still build up evidence about what works. We can work out whether something is cost-effective or not. And sometimes if we have measures, we tend to be much more rigorous in our work. We're working to outcomes, we're working to measures. So in principle, measurement is a great thing for getting us from A to B.

But there are some challenges which I'd like to talk about and I think these are both about getting from A to B but also deeper beyond that. Obviously, although sometimes it doesn't seem obvious, is not everything good is measurable. So there can be things which are very, very difficult to measure, to evaluate, but nonetheless they might have significant intrinsic merit. Further, not everything needs to be

comprehensively measured. So let me give you an example. Ed Sheeran wants to get more musical instruments into schools for deprived students. Now we could do an RCT and try and say well is that actually a good use of money given their future social happiness compared to using the money in another way.

I don't think we need to. I think we can say that that is a good thing, both from an equity point of view, because it's only wealthy students who get access to musical instruments, but it's also something about a human right to enjoy music. We don't need to go into some sort of complex proof about that. My other concern is something I'm calling epistemic or knowledge paralysis, and that is...

particularly as funders, we can't fund anything unless there is an RCT, unless there is real proof of causal attribution. I think that's really undermining because it rules out a lot of projects which haven't had the time or don't even have something which is sufficiently able to be measured. I think it creates real blockages in the system.

An ex-director of LSE, Ralph Dahrendorf, called the area of civil society, of doing good, the area of creative chaos. And I think if we insist on certain extremely arduous standards of evidence gathering, we are really constraining that arena of creative chaos. This fascinated me. This is a quote from a Stanford Social Innovation Review article. And the authors are saying

from Bridgespan, one of the most influential consultancies in the non-profit space in the US. And they said, and it was a real apology, "Our focus on measurement has meant that we overlook those organisations, and particularly those from the black and minority ethnic community in America, who don't fit the narrow definition of good that we have according to our measures."

So it's always interesting to think when you're measuring, where on earth do the measures come from, your targets and so on? What idea of knowledge has created those targets? Next problem about measurement is some idea of oversimplifying social problems. Herbert Simon was an extraordinary economist, came up with the terms bounded rationality, satisficing,

Bounded rationality meaning that we never have the ability to make perfect decisions. We either have too much information, we have too little information, and anyway we're humans, we can't compute this very well.

What he said was even in corporations, the response is either to create maximizing solutions for a radically simple version of the world or to create satisfactory solutions for the world as it really is. I sometimes feel that when we are creating these very neat key performance indicators, these very neat measures, that we are indeed finding optimal solutions for a simplified version of the world.

we're not really accepting the complexity of social problems. Final problem around measurements and indicators is simply that the measurement takes over. And in many parts of human activity you can see that

there is a sense that we have to show some sort of proof, we have to show some sort of measurement in order to get funding, in order to get some sort of certification, in order to get some sort of grading. And then we enter into a world where measurement has taken over and it's a performance. It's not about really attaching measurement to the social phenomenon we want to make better. So a few suggestions very quickly there.

Measurements should always be proportional to the particular task, the number of people you are helping, the size of the organisation. It will depend on the field of action. So much of the emphasis on measurement is actually in the field of health, where often you can achieve... You have circumstances where an outcome is easily measurable. What is the task and technology that you are using? Is it clear?

Is there a clear route from A to B? If there isn't, you can't really measure adequately. And finally, are you trying to explore a social phenomenon or are you seeking proof that an intervention works? That will lead to radically different decisions about whether measurement is useful.

But I am going to say that even though I am being a little bit critical of RCTs, a little bit critical of quantitative measurement, that doesn't mean you can't be rigorous. And there's always got to be some idea of rigor. There are alternative, more qualitative ways of evaluating what you are doing. And if you can get causal attribution and find some way of measuring that, that is always a gold standard.

We're nearly at the end, sorry, I've gone a little over the time I desired. But a very, very important point is, so far I've just talked about means. I've talked about how we get from A to B, instrumental rationality. I have said nothing about how we decide on B, on our end, on what we're trying to achieve.

And this is the area of substantive rationality or values rationality, how we perceive and decide upon our end. So when we're saying we're doing good, what is good? What is our definition of public benefit? And does it matter how we get to point B? Is that part of our definition of point B, the means by which we get to point B, the processes we go through?

I think decisions about substantive rationality, about what our values are, absolutely influence all the discussion we've had so far about whether we think these are good means of getting to an end. I've got some examples of the sorts of values you might want to think about. Do you want to help as many people as possible or do you want to help the most vulnerable?

If you want to help as many people as possible, then the market might be a good way of doing it. If you want to help the most vulnerable, then it might not. Is redistribution of power important to you? Then that would be very important for how you view knowledge versus creating an effective service. Does the quality and nature of relationships matter? I'm going to come back to that one. And the final point here is the situation of M-COPER, we seem to have a good end point, this market.

But actually, is that endpoint the right endpoint? Is actually the endpoint we desire a situation where we have a fully socially democratic government running public services, very little marketization? If so, then the M-COPA model is not a good way of getting to the end that we seek. So we have an intermediary end and a final end. But I just wanted to talk finally about this issue of quality and nature of relationships.

My father used to do volunteering for Meals on Wheels. For those of you who don't know Meals on Wheels, it is the idea of taking meals out to those in the community who can't cook for themselves, the elderly, the vulnerable. And typically in the UK, it was done by volunteers. So what would happen is the local council would itself heat up these meals

and volunteers would go and collect these meals and take them out to the local community. My father would drive around in his car delivering these meals. He had to be quite quick because you didn't want the meals to go cold, but they were in a nicely thermal box. So he would spend a little time getting to know the people he was delivering to build up a relationship with them.

And then one day the volunteers were told they were no longer wanted because the Meals on Wheels service, for reasons of efficiency and price, was going to be subcontracted to a profit-making firm. Now in this case it's possible that the meals were getting there a bit hotter, or maybe the council was doing this in a more cost-effective way, but what you lost was all the aspects of the process which were valuable.

the social capital or people talking to each other, the relationships that were being built up, the antidote to loneliness that was there. So how you see the end, is it simply about the consequence, getting a meal out to people, or is it about the process, the relationships, that will affect how you consider all that I've talked about so far. So in sum, there is no single answer to this, and I'm sorry if you were coming expecting this.

My students will be very well aware that the thing I say in every single lecture is, "It depends." It really does depend. This is not chaotic contingency. What social science can do is map out the themes and patterns and say, "This is what you need to take into account about the context you are working in."

So I've listed there some of the things you might want to take into account. The first, going right back to an earlier slide, is what sphere of operation are you in? Civil society, high impact social innovation. Then we talked about a lot of technical considerations like what knowledge do you need? Can there be a viable market?

But very importantly, you have to consider what your values are too. Because how you see the means to an end, how you see these new trends of science and business will depend on what your values are. The final point is that there is real opportunity for innovation here. For bringing together things which are unlikely, like self-interest and altruism, market and purpose,

combining knowledges for good. And that is, I think, really exciting and it's the job of researchers but also practitioners to explore those things. So finally, I think my job as a professor is simply to

interesting new insights to the world of practice, to the people who can really create impact. I hope some of the suggestions and the insights in this lecture have been useful for that purpose. Most of all, I know that most of my best insights have come from listening to students and practitioners. So if anything comes out of this lecture, I would love it to be an ongoing conversation. Thank you.

Thank you very much, Jonathan. Well, now we're a little over time, but we have time for a few questions.

People who are watching online can put questions and Kate will read out some of the questions. Have some of the questions started coming in already? All right, okay. But I think we're open. I have a number of questions, but I think the opportunity, the floor is yours. So if anybody has any questions, could they raise their hand and we'll proceed. Yes, sir. Over on the left there. Yes.

There's a microphone coming, yes. Hi, I'm interrupting this event to tell you about another awesome LSE podcast that we think you'd enjoy. LSE IQ asks social scientists and other experts to answer one intelligent question. Like, why do people believe in conspiracy theories? Or, can we afford the super rich? Come check us out. Just search for LSE IQ wherever you get your podcasts. Now, back to the event.

Thank you very much for a fascinating, very thought-provoking lecture. You've described there are a number of win-win situations that you described, M. Coper being an example, and also I thought that the...

apparently the provision of education for girls in India and the way that this was being analysed in a very precise way. But what it occurs to me is that doesn't this idea of profitable philanthropy or what might be called the commercialisation of charitable endeavour not simply have the effect of letting governments which have embraced market capitalism off the hook?

So, I mean, for instance, it would be an outrage if there were girls being discriminated against, as far as education is concerned, in most Western countries. Well, all Western countries, in fact. It would just be considered absolutely appalling. But is this, in a way, looking at an individual case like that, letting the government off the hook? Yes, thank you for that. And that's certainly a criticism that can be applied. I think...

What I find is you can look at this from perhaps a purist sense and say, yes, this is letting government off the hook because government should be getting out there and doing it. And the realist sense, which is that in India, the government is not doing it. And

We can do a lot of activism to try and make the government do it, but will that work? So I am coming at this from quite a pragmatic perspective, that if there is this organisation which is...

is in itself not commercial and is being funded by various big foundations to do its work. If it can get those girls, and it seems to be remarkably successful in doing so, get those girls into schools, and they are of course government schools, then that is a good thing. And I think one of the disappointments for Educate Girls is even though it's created this proof of concept,

still government is not coming in to fund it. So I agree absolutely we've got to work and campaign but at the same time I don't think we can wait for government. That would be my response. Yes sir. My phone's coming.

Thank you. My question is, as societies and governments move in Western Europe and North America, particularly to the right, what impact do you think that's going to have upon doing good? I was hoping for an Elon Musk, Donald Trump question, and that's getting close to it. What a political question. So...

I mean, there are things we can simply point to from a theoretical perspective, which is that the smaller the state, the bigger the non-profit sector gets, because there's a massive gap for social services.

However, where that money is going to come from is a question. But there will be more demand and more need. And typically you've seen a large service-providing non-profit sector in the US compared to Sweden where the state does all the provision. Looks like that phenomenon is going to continue and get worse. I think the other link to that is...

If there is a need for more resourcing, then you are going to see more non-profit organisations doing these commercial activities because they need to find new sources of income. Some of those commercial activities might be great, but there is a danger that you're going to see non-profit organisations compromising themselves by going down that route as well. The other aspect, which I think is probably safest not to go into, but there is going to be a huge need for...

more community-based activist organisations to try and bring communities together when we're facing this really appalling polarisation in our politics. Kate, could we ask if there's an online question? Thank you. Yeah, so this question comes from the Q&A and it's, can impact be translated into a single currency that can be monetised in the impact economy marketplace? Okay, so...

Great question. I'm going to interpret that as more or less can we do for impact what we do for profit and accounting? And the answer is that

People are working on this as we speak, particularly in Harvard and the impact weighted accounts. The idea that you can put a single figure on impact, which would enable this investment structure to be much more fluid, much more easy.

There are different views on this. There are different views on this within the Marshall Institute. My view is that this is extremely ambitious because to create an impact currency means that you really need to be able to

put a number on different parts of education and say getting someone to, I don't know, a grade B is equivalent to making them happy or making sure their mental health is alright. And then you've also got to compare it to health.

So the assumption here in the language of accounting is these things have all got to be commensurable. And I think that's a really, really hard thing to do. So I'd love it to happen, but I'm doubtful whether this is achievable. Is there another online question?

Again, on the potential role of the state, which is what might the positive role be for the state as a collaborative actor, as in Mazzucato's entrepreneurial state, rather than as an absent state? What might be the collaborative role for the state in promoting social enterprises, rather than as an absent state, in the earlier example? So, I mean, there are multiple ways in which the states can...

I mean, I think there are simple policy levers like tax incentives. There's a whole area of blended finance that we haven't talked about. One example of that is the social impact bond. Now, as always, I'm going to say...

It depends. Social impact bonds are sometimes useful. The idea here is you test out an intervention, it's funded by private money. If the intervention works, then the government

give some sort of reward to the private money. If it doesn't work, the private money is lost. I think those sorts of clever partnerships could be very useful when the state is cash constrained because if you're testing an intervention in that way, the state has no risk unless the outcome is successful. So there are partnerships like that which I think we can explore. We do have the inventor of social impact bonds in the audience.

at the moment. David, I don't know whether there's any comment you would like to make on the role of the state vis-a-vis? No. Other questions? Andreas. Thank you, Jonathan, for that wide-ranging lecture. Lots of food for thought. I want to go back to the question of corruption.

as you defined it, whether certain goods are corrupted, their essence is corrupted by virtue of being supplied by the market. At some level, the answer must be yes.

A medal for valor is to be assigned to people who are really courageous. If we put them on sale on eBay, they lose some of their essential value. But whether this is a more general proposition or not is less clear. There's one counterexample which I love and on which I would like your thoughts. Deborah Satz, the Stanford political philosopher, once said,

In every American motel room, if you open the night table, there is a Bible. The Bible was produced and paid for by a for-profit company and is being supplied by a for-profit hotel chain. Does this diminish the value of the Bible? Her answer was, not at all. Yeah, yeah. I certainly would say, yeah, it's a very...

So one intriguing thing, and correct me if I'm wrong, is that those Bibles were placed free of charge. But even then, that doesn't work so well because we buy and sell Bibles, so that's not a good example. So I think, as usual, I would say it does depend on the particular good, and...

There are two reasons why a market might be... Well, there are many... There might be more, but the two reasons I have for why a market doesn't work is, first of all, inequity, and secondly, corruption. The issue of inequity is an easily understandable phenomenon across any good, but for corruption, I think you have to look at each individual good and see whether the particular circumstances of its purchase or not corrupts.

For a long time, I have, as my students know, been puzzled about the idea of organ donation and whether it should be possible to buy and sell kidneys. Now, at the moment, strangely, despite what I said in the lecture, I'm on the side of you should be able to buy and sell kidneys under strictly regulated conditions which dispense with inequity problems. So, I get the point. I think perhaps...

My usage in the lecture muddled two concepts. One is the corruption of the good and one is the corruption of the relationship. So I think your challenge and clarification is a good one. And the issue with Price's text line was they had corrupted their relationship by using data in a certain way. So thank you for that. Got questions just up there.

Hello, I'm from Mulberry School for Girls. Thank you so much for this fascinating lecture today. My question to you is, philanthropy is a big part of many world religions like Christianity and Islam that state that your left hand should not see what your right hand gives when it comes to giving funds to make a community better and doing good. What is your analysis of this and how can it be applied to today's society? Okay, thank you. So first of all, a warm welcome to Mulberry. Good to see you.

So, the question is about philanthropy in communities driven by religion. Yeah. So, the first thing I would say is it's a wonderful thing that we can have this impetus driven by religion to give to others. And, as I've said, I think there may be more need for philanthropy going forward because of the troubles that states are experiencing. So, I guess my challenge is that...

When some of those conventions were first introduced, for instance, in the Jewish community, very strict injunctions about philanthropy and in Islam too, there were actually very, very strict instructions too about how you would do it.

And so in a sense, we're doing good and having impact. The problem is that those instructions were written many, many centuries ago. And what we don't have is a new set of instructions to explain to us how we should do that good. Not only that we should give the money, but how we should do it. So perhaps some of the things I've been talking about might be useful there. But I think there's a challenge to the religious communities to think about. Can we define how we can make the maximum use of this money that we are raising?

Yes. Thank you so much. I've worked in the charity sector and corporate philanthropy for a while now, and I just wanted to say a lot of the challenges which you discussed I've bumped up against in my professional career, and it's actually really good to see them on this platform and get discussed in this way. So thank you so much for that. My question was around your point around you talked around charities and care and how

that there might be a disconnect between outcomes measurement and the outcomes of care which charities seek to give.

From my perspective, because these care outcomes which charities deliver are the most precious, surely we should be applying really rigorous outcomes measurement to charities because those outcomes are more precious than clicks or customer interactions. In my mind, I don't see the disconnect between applying that sort of

private sector outcomes measurement methodology to the tracking of care outcomes in the charity sector and I just wondered how you would respond to that. First of all, thank you for your kind comments and I'm glad it's useful to say these things out. Yeah, it's a great point and so first of all I do think that as I think I indicated, rigor is important and where you can do it, evaluation and measurement is important.

I think if we can find the right metric, then yes, measuring care is vital. Having had some experience of a relative being in a care home,

It was difficult to see how you could really capture care in a metric, but maybe you can. But again, it all depends on context. And I was having a very interesting conversation with David, who's in the audience tonight, about...

care workers visiting people in their homes. At the moment the indicators are all about do you take the person to the toilet? They're the wrong indicators. One problem perhaps is we're bringing rightly in these techniques but using them wrongly.

And what about if we had, and this is David's suggestion, what if we had smiley faces that the users filled in at the end to say how happy they were or not after the visit, and that way capture that idea of care. So I think I agree with you as long as these metrics and measurements are used in the right way.

And sometimes, unfortunately, I think there is a bit of a conflict between efficiency, which in principle is a good thing, and the idea of care and effectiveness and never having enough time to look after someone, those sorts of dynamics. There was one question down here. Somebody, yes. Thank you. I think that's getting near to our last question.

Hello. You mentioned about the lack of governance of the sector. What is stopping them to self-govern or to come up with code of ethics like other industries or sectors have done? What is stopping the sector of doing good to self-regulate?

Yes, I think my term external governance is perhaps a slightly ambiguous one because one thing I would say actually is that to some extent parts of the non-profit sector and particularly the formal non-profit sector charities are extremely governed. And you have the Charity Commission for instance. But the point is with this sort of governance that it is governance of integrity,

and ethics with not governance of effectiveness. And the Charity Commission generally, sometimes, but generally doesn't go near effectiveness in what it does.

So, whereas the market has certain mechanisms to give feedback about effectiveness and if you're selling Mars bars that no one wants, you go out of business, the same is not true of the charity sector. They don't also have the voting system. So, the idea is you don't get the feedback on effectiveness. There isn't a government system around effectiveness, was what I was trying to say. Well, they say that charity begins at home.

It's fairly clear that the analysis of charity is undertaken at the LSE and it's fairly clear where it is undertaken most effectively by Jonathan and I think you can see from the quality of the questions how much you have stimulated us all in what you've said. So it remains for me to thank you very much and to invite everyone to join us for a small reception outside.

if you have a moment or two, and we will be there to take the discussion further. Thank you for listening. You can subscribe to the LSE Events podcast on your favourite podcast app and help other listeners discover us by leaving a review. Visit lse.ac.uk forward slash events to find out what's on next. We hope you join us at another LSE Events soon.