New Research on How $15 Billion Can Be Moved to Higher-Performing Nonprofits

• Individual donors research only a third of their charitable donations, whereas those that advise donors and foundation grant-makers research almost every donation they make;
• Despite these different behaviors, the groups have similar preferences for research. Specifically:

• They want a broad range of information on nonprofits’ impact, financials, and legitimacy.
• They want data provided in transparent formats or portals that provide them with several pieces of information. They prefer these formats more than 2:1 to simple seals or ratings.
• They want this information from third-party portals that provide information on nonprofits. Specifically, 53 percent of donors want to use such sites, though few know they exist today; and

• Of all the information they are looking for, impact and effectiveness data are seen as the greatest unmet need for each group – and the most urgent need for the sector.

These findings present a wonderful opportunity for nonprofits to better connect with donors by providing more — and more detailed — information about their organizations. At the same time, it’s an opportunity to educate donors about the need to research before donating. MFGII provides actionable recommendations, including:

• How individual donors can take a few easy steps to make better charitable gifts this giving season by reflecting, researching, and rebalancing;
• What high-performing nonprofits can do to increase their fundraising and operations through an intentional focus on impact, effectiveness, and efficiency; and
• How nonprofit information portals can better address user needs and create a more efficient philanthropic market

“We live in a world of reactive giving, where we give to our brother-in-law to support his marathon; to our friend hosting a fundraiser; to a phone call or mailing we receive,” said Greg Ulrich, director of advisory services at Hope Consulting. “Nonprofits need to show just how effective they are in meeting their mission – and most importantly, donors need to look for that impact information before they make a charitable gift. Changing the system will be hard, but not impossible.”