Informing Donors About Nonprofit Performance

As Jacob Harold described last week, the current system for getting donations to nonprofits is faulty. It's usually aggressive fundraising and slick marketing rather than high impact that bring in donor dollars. If donors do look for objective information about nonprofits, they'll often find Charity Navigator and rely its financial rating, which is virtually meaningless used alone. Since donors aren't deciding where to give based on impact, nonprofits have little direct incentive to strive for great outcomes or to track what they accomplish. Charity Navigator has asked a set of nonprofits if they would provide outcome data and so far less than 10% have done so. That doesn't necessarily mean only 10% have systems to measure outcomes. But it's not a good sign.