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Evaluating Charities to Align with Social Vision


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Presentation on evaluating charities for the #Rotary District 5360 conference

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Evaluating Charities to Align with Social Vision

  1. 1.  Evaluating Charities for Impact Benchmarks of Highly Effective Charities Gena Rotstein, FEA, MA CEO & Advisor in Philanthropy
  2. 2. About DVI and Gena Rotstein
  3. 3. Vision “To make charitable giving a part of every person’s banking and financial management experience and positively influence $1Billion in charitable transactions.”
  4. 4. Integrating Philanthropy Planning with Wealth Management  About Dexterity Ventures Inc. & Gena Rotstein  Personal and group values shaping charity evaluation  Evaluating the Social Impact  If we have time…Non-traditional "philanthropy“
  5. 5. How do I knowWhat Most Needs Doing? Benchmarking charities for impact and effectiveness
  6. 6. What is Philanthropy?  Love of mankind  A financial transaction predicated by moral response to a social dilemma  As a phenomenon, philanthropy is actively practiced throughout the world through voluntarily giving of time, talent and resources in support of the common good (Wagner et al, 2003, p 442)
  7. 7. What is Strategic Philanthropy?  The process of identifying what you want to see society look like, and using philanthropy as one of the tools for achieving that vision  The Charitable/Philanthropic Plan is the coordinated steps in achieving the vision
  8. 8.  Picture Card Activity Small group acitivty
  9. 9. What Most Needs Doing? Collective Impact Source: Collective Impact – Kramer, FSG Consulting
  10. 10. D-Rev - Mulago Foundation
  11. 11.  “Greatness has more to do with how non-profits work outside the boundaries of their organizations than how they manage their own internal operations.” ~ Forces for Good  “High impact non-profits work with and through organizations and individuals outside themselves to create more impact than they ever could have achieved alone. They build social movements and fields, they transform business, government, other nonprofits, and individuals; and they change the world around them.” ~ Creating High Impact Non-Profits What Makes a Great Non-Profit?
  12. 12. A Diversified Portfolio to Drive Social Change Social Issue Investments – Shareholder Activism, Private Equity, Traditional Philanthropy – Annual giving, multi-year financing AdvocacyVolunteerism Vendors/Suppliers
  13. 13. Charities & Non- Profits Social Investing Social Return on Investing Social Entrepreneurship Social Finance Social Capital Shared Value Collective Impact Social Innovation Social Impact Bonds & Community Impact Bonds Patient Capital Co-Operatives The Social Profit Sector
  14. 14. What Role DoYou Play?  Donation advisor  Vetter of options  Transactional  Solution creator  Asset manager (Investment committee)  Sponsor  Participant  Consumer  Connector
  15. 15. Donor Profiling – Creating a Strategy for Giving • Leadership • Program Implementation • Community Engagement • Volunteerism/HR • Governance (policies & procedures) • Funding & Financials Source: Benchmarks for Evaluating Charities
  16. 16. What to look for?  Program Implementation  Capacity to report on long term effectiveness  What is success?  Volunteerism/HR  Hiring policies  Staff & Volunteer turn-over  Financial Management/ Fundraising  Overhead  Operational Effectiveness  Diversified funding portfolio  Leadership  Qualifications  History & Connectedness  Board engagement  Governance  Strategic v. Operational Board  Policies to protect donors and clients  Community Engagement  How do they work with others in their industry?  Media
  17. 17. Governance & Leadership Serve & Advocate What to Evaluate  Strategic Direction  Financial Oversight  Ethical Fundraising  Policies & Procedures  The role of the board is to drive the direction of the organization, represent the needs of society, and steward the donors’ interests
  18. 18. Community Engagement  A community is defined not only by the geographic but by those individuals and groups that are within. A great charity has strong, positive relationships within its defined community.  Competitive Analysis “Creating Evangelists”* *Creating High Impact Non-Profits, SSIR
  19. 19. Program Implementation  Plan, Execute, Adjust  How resources are being allocated in order to achieve the mission  How the organization fosters exploration, experimentation, growth and solutions to the mandated problem. Effectiveness = Time of your donation + Amount Needed
  20. 20. HR/Volunteerism  A use of human capital (talent and ties) to offset HR and admin costs  Ties financial contribution to time contributions  Policies & procedures are aligned with the values and mandate of the organization
  21. 21. Financial Management  The last sign of an organization in crisis is usually seen in the financials. The Canary in the Mine
  22. 22. Questions to Ask Group discussion
  23. 23. Governance & Leadership 6. What is the composition of the board? How long are their terms? 7. Are conflict of interests publicly stated? 8. Policies & insurance to protect assets 9. Are conflict of interests publicly stated (i.e. investments are being held by the firm of a board member)? 10. What is the ED evaluation process? 1. What is the strategic direction and who is managing it (board make-up? 2. Is the board managing the budget & key financial transactions? (Chair, Treasurer and CEO different people) 3. Have they filed their annual return with the IRS or CRA? 4. How often does the board meet? Do you feel that it is often enough? GUT CHECK 5. Privacy statement
  24. 24. Admin/Operations What is Good Management?  Management team  Volunteer team  HR Policies & Procedures  Shared Leadership 1. Are the right people sitting in the rights seats on the bus to drive the operations? 2. Whistleblower policy? 3. Does the salary policy create a cycle of poverty within the organization? Is it competitive with the marketplace? 4. Is there a business plan? 5. Are the opportunities for professional development? 6. Are staff appropriately trained?
  25. 25. Financial Management How do I evaluate Financial Management?  Know the marketplace  Donor Bill of Rights  Report on Financial Activities  Investment policies What are the liabilities? 1. Are there public policies on expense reimbursements? 2. Who manages the investment assets? Are all the investments with one firm/broker? 3. How much of the operating budget is spent on program delivery? 4. How long does it take for the donated funds to “hit the ground”? 5. Who is doing the fundraising?
  26. 26. Community Engagement How to measure public perception  Inspires others to get involved  Creating strong networks with other non-profits  Strong relationships with media 1. Which companies have affiliated their brand with this organization? 2. What other charities are working with the organization that you support to address the issue that is mandated? 3. How has the organization been represented in press (unpaid)? 4. Who are the major donors and how are their donations being leveraged? 5. How are community members engaged in the organization?
  27. 27. Program Implementation: Is my money working?  People  Capital  Infrastructure  Innovation 1. What is the funding ratio (private foundations – government – corporate – individual donors – fee-for-service)? 2. What is your commitment to investing long-term? 3. What is your commitment to investing in overhead? 4. What is the process for measuring success? Does the organization have the ability to learn from failure and adjust? 5. What does success mean to you?
  28. 28.  Donor Bill of Rights  Charter of Ethical Fundraising  Philanthrocapitalism  Giving 2.0  Giving Well  The Art of Giving  End of Fundraising  Impact Assets  Uncharitable  The Creative Class  The Blue Sweater  Soul of a Citizen  The HIP Investor  Harvard Business Review, Stanford Social Innovation Review  Blogs:    Resources & Book List
  29. 29. Contact information Gena Rotstein 1-866-936-4483 403-860-7572 @Place2Give @DexterityCon
  30. 30.  Non-Traditional Philanthropy Social Impact Bonds, Community Impact Bonds, Co-Operatives, Patient Capital
  31. 31. For Profit Social Enterprise
  32. 32. Village Capital*  Private equity placement in local social businesses  Co-Ops  Patient Capital  B-Corps  Community Economic Development/Social Biz Investments (BC, MB, NS)  L3C’s (US)
  33. 33. Crowdfunding: Awesome Foundation The power of the crowd
  34. 34. Micro-Lending