crowdsourcing, transparency and results based charity ratings
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Crowdsourcing, Transparency and Results Based Charity Ratings – The
Next Generation of Nonprofit Evaluation
Presented by Ken Berger, President & CEO
NextGen:CharityNew York, NY
November 19, 2010*Prototype for purpose of illustration only and in no way represents the final product.
Your Guide to Intelligent Giving
Where the Heart
Meets the Mind
America's premier
independent charity
evaluator providing timely, relevant,
unbiased information on the fiscal health
of nonprofit organizations.
Largest evaluator of charities: 5,500+
#1 Web Site for Rating Charities – “Your Guide to
Intelligent Giving”
The Data Proves Impact Estimated 3 million
distinct visitors per year
92% say evaluations affected their decision to support individual public charities
CN ratings influence decisions on billions in donations annually
(The Nonprofit Marketplace Hewlett Foundation, 2008)
*Includes Charity Navigator- evaluates nonprofits and provides meaningful information.** Includes individuals, foundations, corporations and government funders.
The Explosive Growth of Nonprofits in the US
The Problem
The Solution!: A 3-D View
QUALITIES OF A HIGH IMPACT ORGANIZATION
Accountability & Transparency
Financial Health
• Positive, sustainable change• Independently evaluatedHIGHER RISK
INVESTMENTLOWER RISK INVESTMENT
Financial Health
Accountability/Transparency
Results More Comprehensive Rating System
Introducing CN 2.0
THE EVOLUTION OF CHARITY NAVIGATOR2001 – FORMED WITH A MISSION TO BE A DONOR’S GUIDE TO INTELLIGENT GIVING.
2002 – 2007 - USED IRS DATA (990’S) BECAUSE MANY NONPROFITS DIDN’T LIKE US! IT WAS THE ONLY DATA AVAILABLE FOR META ANALYSIS.
2008 - ANNOUNCED PLANS TO REVAMP RATING SYSTEM TO MOVE TO 3-DIMENSIONAL
2009 - FORMED ADVISORY PANEL
2010 - RECEIVED HEWLETT GRANT TO LAUNCH VOLUNTEER STUDENT RATING PILOT PROJECT TO SCALE UP & FIDELITY CGF TRUSTEE’S PHILANTHROPY FUND FOR STRATEGIC PLANNING .
CN 2.0 - From One Dimensional to 3-Dimensional
20
40
60
80
100
120
2002
to 201
020
11
2012
& B
eyon
d
% W
eig
ht o
f Rat
ing
Effectiveness/ Results
Accountability/ Transparency
Financial
100%Financial
33.3% Account-Ability/Trans-
parency
+66.6%
Financial
50%Results
+17%
Accountability/Transparency
+33%
Financial
SCALING UP: 6 Steps to a 3-Dimensional Rating System
July 2010
Accountability &TransparencyMethodology
Launched (achieved)
Fall/Winter 2010
Financial Metrics
Revised (in process)
July 2011
Methodology to Measure Results
Launched (provided adequate funding is secured
to scale up)
Accountability & TransparencyNow Part of Star Rating
(in process)
July 2012
Results Dimension Now Part of Star Rating (assuming data has now been collected for all charities in CN’s database)
July 2013
Incorporation of reviews/data into Results Dimension (e.g.
beneficiary satisfaction, volunteer reviews,expert reviews and independent impact
evaluations.)
1
2
3
4
5
6
FINANCIAL
(33 Points)
ACCOUNTABILITY/
TRANSPARENCY
(17 Points)
RESULTS
(50 Points)
EFFICIENCY
(10)
SUSTAINABILITY
(23)
Overhead
(3 yr. moving average)
•Working Capital•Current Ratio Web Site & 990s
Keystone/NPC
7 Questions &
3rd Party Reviews
Low
Risk
27 – 33 15 – 17 38 – 50
Moderate
Risk
22 – 26 13 – 14 26 – 37
Intermediate Risk
18 – 21 11 – 12 12 – 25
Significant Risk
13 – 17 9 – 10 8 – 11
0 Stars High Risk < 13 < 9 < 8
FINANCIAL
0 – 4 STARS
33 Points Max
DCCK: 27 out of 33
ACCOUNTABILITY/
TRANSPARENCY
0 – 4 STARS
17 Points Max
DCCK: 14 out of 17
RESULTS
0 – 4 STARS
50 Points Max
DCCK: 41 out of 50
0VERALL SCORE: 0 – 4 STARS; 100 POINTS; RISK LEVELDCCK SCORECARD: 82/100 POINTS Low Risk
TRANSPARENCY & ACCOUNTABILITY
RESULTS7 Questions* - 50 Points Total Maximum
*For this prototype, we are using 7 questions devised by Keystone Accountability and New Philanthropy Capital.
QUESTION Max Points
1. What is the charity’s commitment to reporting results? 5
2. How does the charity demonstrate the demand for its services? 3
3. Does the charity report its activities (what it does)? 3
3. Does the charity report its outputs (short term results)? 3
RESULTS7 Questions - 50 Points Total Maximum
QUESTION Max Points
5. Does the charity report its outcomes (defined as the identifiable differences that it makes through its work)?
10
6. What is the quality of evidence for reported results? 14
7. Does the charity adjust and improve in light of its results? 12
*Prototype for purpose of illustration only and in no way represents the final product.
Sample Agency Dashboard
EFFECTIVENESS/RESULTS3rd Party Evaluations/Reviews
Weighted score based on quality and rigor of data:
1. Volunteer Reviews2. Primary Constituents Feedback3. Independent Expert Reviews4. Independent In-depth Research and
Analysis
Charity Navigator Soon to Launch Collaboration with GreatNonprofits
Charity Navigator users will now be able to write and read reviews by Donors, Clients Served, Volunteers, Former Staff, Board Members, General Public
Donors Can Expand for More Details
GNP REVIEWS TO REPLACE COMMENTS TAB
NO GOOD DEED GOES UNPUNISHED
The Battle for the Soul of the Nonprofit Sector
OUR BEST HOPE
• Educated and Engaged Stakeholders are our Best Hope!
More Information• Article: “The Battle for the Soul of the Nonprofit
Sector” Berger, Penna and Goldberg, Philadelphia Social Innovation Journal of
• Books:1. Billions of Drops in Millions of Buckets by Steve
Goldberg2. Money Well Spent by Paul Brest, et. al3. The Nonprofit Outcome Toolbox by Dr. Robert
Penna (March 2011)• Web Sites1. www.alleffective .org2. www.keystoneaccountability.org3. www.WhatWorks.org• Video: www.savingphilanthropy.org
Your Questions & Our Web Addresses
Website- www.charitynavigator.org
Blogs- www.kenscommentary.org
blog.charitynavigator.org
Twitter- kenscommentary
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