This document discusses the importance of accountability, transparency, and results reporting in the nonprofit sector. It notes that currently there is little evidence that most nonprofits produce social value. It outlines Charity Navigator's evolution from rating financial health to also rating organizational accountability, transparency, and mission results. Accurate performance measurement is critical for donors, charities, and beneficiaries. Increased accountability and transparency will lead to more nonprofits focusing on measuring their impact and improved human welfare over time by directing funds to effective organizations.

1. Your Guide Where the
to Heart
Intelligent Meets the
Giving Mind

2. The Data Proves Impact
 4.5 million distinct 7000000
visitors (6.4 million
hits) in 2012 6000000
 92% say
evaluations 5000000
affected their
decision to support
4000000
individual public
3000000
charities
 CN ratings 2000000
influence decisions
on billions in 1000000
donations annually
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

3. The Nonprofit Sector Problem*
“… there is virtually no credible evidence
that most nonprofit organizations actually
produce any social value.”
*“The End of Charity” by David Hunter – Philadelphia Social Innovations Journal

4. WHY IS THERE A LACK OF RESULTS REPORTING?
• A Fear of Fallout from Potential Criticism
• It’s All About the Work
• Performance Measures are Reductionistic
• Lack of Resources
• Bored Boards
• Donor Indifference
• The Growth Motive
• Inadequate Monitoring (Internal & External)

5. OUR DEFINITIONS OF ACCOUNTABILITY &
TRANSPARENCY (per Prof. Brackman Reiser)
ACCOUNTABILITY - is an obligation or willingness by
a charity to explain its actions to its stakeholders.
1) FINANCIAL - to safeguard and manage the
charities financial resources.
2) ORGANIZATIONAL – to consistently follow rules of
governance and operational process.
3) MISSION – to set goals and then measure and
manage performance to assure the charity is
achieving meaningful results.
TRANSPARENCY - an obligation or willingness by a
charity to publish and make available critical
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accountability data about the organization.

6. FROM ACCOUNTABILITY IN ONE
DIMENSION TO THREE AND BEYOND
CN 1.0 CN 2.0 CN 3.0
2002 - 2011 - 2013 -
Financial Organizational Mission
Financial Accountability Results A scalable, in
Health (Governance) Reporting depth, multi-
& dimensional
Transparency charity rating
system.
THE FUTURE (CN 4.0?):
OUTCOME MEASUREMENT

7. PART 2
Why do you think this is the most
important issue in the non-profit
sector today?
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8. THE DONOR PROBLEM
0% 20% 40% 60% 80% 100%
Org's Effectiveness 90%
How the Org will Use my Donation 87%
Quality of Leadership 78%
Percent of Costs to Overhead 76%
Ease of Donation 62%
Not Being Asked for Money Too Often 59%
Ability to Direct Donation's Use 46%
Regular Progress Reports 41%
Endorsements by Person I Trust 34%
Prompt and Sincere Thank You 31%
Ability to Get Involved 30%
Org Approach - Novel / Innovative 28%
Contact with the End Beneficiaries 24%
* Based on the Money for Good donor research of Hope Consulting
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9. WHY IT IS SO IMPORTANT FOR DONORS?
Because donors will have access to much
more robust information than ever before
about each charity’s ability to bring about
long lasting and meaningful change in the
world.
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10. The Nonprofit Sector Problem*
“… there is virtually no credible evidence
that most nonprofit organizations actually
produce any social value.”
*“The End of Charity” by David Hunter – Philadelphia Social Innovations Journal

11. WHY IT IS SO IMPORTANT FOR CHARITIES?
Because many more charities will become
focused on measuring and managing their
performance.
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12. THE BENEFICIARY PROBLEM
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13. WHY IT IS SO IMPORTANT FOR BENEFICIARIES?
Ultimately we believe this will lead to a
significant and measurable improvement
in human welfare and acceleration in
solutions to our world’s most persistent
problems.
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14. THE PROBLEM SOLVED
(The Nonprofit
Marketplace
Hewlett Foundation,
2008)

15. HOW WE ARE HELPING SOLVE THE PROBLEM