Study Calls for Greater Flow of Information in Philanthropic Sector

"Nonprofit leaders need to use that information to drive performance and make decisions that lead to greater social impact," the study notes, recommending that organizations share their "theory of change (or impact model)" and outcomes. This can "create a richer, more honest dialogue around performance."

If your organization lacks outcomes data, then having information on your mission, strategies and goals, quantitative data on inputs, activities and outputs, and beneficiary and staff feedback — even if it's negative — is a start.

3. Educate donors about how to assess nonprofit performance. Engage donors as partners and educate them on what your organization is trying to achieve and why it's important. Share goals and activities, and let them know how you measure your organization.

"As the information gap starts to close, nonprofits need to be ready to answer more questions about how they are doing, welcome these inquiries and have a system for responding," the study advises.

It also offers suggestions for ways individuals, foundations and intermediaries can help create transparency and greater flow of information in philanthropy — for example, suggesting individual donors adopt more of an investment mindset, and seek and demand performance and impact information.

To view the study in full and engage in online discussion of this topic, visit www.givingmarketplaces.org.