Valuing Impact Presentation, May 2009


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Presentation given by Charity Navigator's President & CEO, Ken Berger, at the Valuing Impact conference in London. This was the first international gathering dedicated to exploring nonprofit analysis, and an important first step towards creating an Association of Nonprofit Analysts.

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  • Valuing Impact Presentation, May 2009

    1. 1. A Conversation About Measuring Impact Presented by Ken Berger President & Chief Executive Officer at Valuing Impact Event London, UK May 19, 2009
    2. 2. Charity Navigator’s Current Impact <ul><li>Estimated 3 million distinct visitors per year (4 million + hits) </li></ul><ul><li>92% say CN ratings affected their decision to support individual charities </li></ul><ul><li>CN ratings influenced approximately $10 billion in donations in 2008 </li></ul>
    3. 3. <ul><li>Administrative Expense </li></ul><ul><li>Fundraising Expense </li></ul><ul><li>Program Services Expense </li></ul><ul><li>Fundraising Cost to Raise a Dollar </li></ul><ul><li>Program Growth Rate </li></ul><ul><li>Revenue Growth Rate </li></ul><ul><li>Working Capital </li></ul>SEVEN VARIABLES MEASURING FINANCIAL HEALTH
    4. 4. WARNING IN USE OF OUR DATA <ul><li>To make wise giving decisions, our ratings are a &quot;part of the puzzle&quot;. </li></ul><ul><li>Be Proactive In Your Giving - Smart givers ... have targeted outcome goals for their giving.... </li></ul><ul><li>Start A Dialogue To Investigate Its Programmatic Results - assess a charity's programmatic impact , talk with the charity to learn about its accomplishments, goals and challenges . Be prepared to walk away from any charity that is unable or unwilling to participate in this type of conversation. </li></ul>
    5. 5. THE PROBLEM <ul><li>Some donors are not taking the additional steps we recommend to assess outcomes </li></ul><ul><li>They are relying almost entirely on our ratings. </li></ul><ul><li>While we assume that financially strong organizations are far more likely to be effective in their outcomes, it may not always be the case. </li></ul><ul><li>Alternatively, charities with mediocre financial strength may not necessarily have mediocre outcomes. </li></ul>
    6. 6. <ul><li>Financial Health </li></ul><ul><li>Accountability & Transparency </li></ul><ul><li>Outcomes </li></ul>THE SOLUTION: 3 COMPONENTS OF A NEW CHARITY EVALUATION SYSTEM
    7. 7.
    8. 8. A SCARY FINDING ON OUTCOME MEASUREMENT <ul><li>We have been testing out what information charities are currently compiling in the area of outcome measurement. </li></ul><ul><li>We assumed that most charities have SOME system of evaluating their outcomes. </li></ul><ul><li>So far, less than 10% of the charities we have polled have provided us with meaningful information in this area. </li></ul>
    9. 9. HOW CHARITIES CURRENTLY “RATE” All 2% 0-Star Exceptionally Poor 9% 1-Star Poor 23% 2-Star Needs Improvement 36% 3-Star Good 30% 4-Star Excellent
    10. 10. HOW MIGHT THEY RATE ON OUTCOMES? All 30% 0-Star Exceptionally Poor 36% 1-Star Poor 23% 2-Star Needs Improvement 9% 3-Star Good 2% 4-Star Excellent
    11. 11. AN INTERIM SOLUTION? CONSTITUENCY VOICE <ul><li>Promoters – Detractors = </li></ul><ul><li>NET PROMOTER SCORE </li></ul><ul><li> </li></ul>
    12. 12. Our Web Addresses Website- Blogs- Email- [email_address] Twitter- kenscommentary