When it comes to discussions I’ve had regarding the work of nonprofits, a statement such as this ultimately works its way into the conversation “Yes, but do you realize that only x % of the donations made to such and such nonprofit actually end up funding their programs?! They’re not effective! And they’re using donations to pad their personal wallet, travel, etc? I only give my money to organizations that are efficient with how they use donations.”
I get the sentiment of such a statement; the desire to be informed and make sure that our donations are being used in such a way that actual social change and progress occur. No one want’s to be conned. The problem is that the metric so many of us turn to in order to determine an organization’s effectiveness, the % of donations spent on the nonprofit’s actual programs, has major shortcomings.
I spent a year of grad school picking apart this and other metrics used to rate nonprofits. Basically, I chose to focus on one nonprofit, using them as a case study and structuring my research in such a way that I was able to determine the ways in which these metrics accurately conveyed the nonprofit’s effectiveness and the ways in which they seriously misconstrued the effectiveness of the work being done.
These metris fail to incorporate answers to important questions such as:
- what kind of labor is required to do the work at hand? (e.g. will short term, untrained volunteers suffice or are long term, trained personnel required (lawyers, doctors, accountants, geographers, etc))
- Is the work being done long or short term? Is it dangerous work requiring costly equipment and/or staff to aid in the safety of the volunteers?
- Is the travel to the region in which the work is occurring long or short term, expensive or inexpensive?
- is the nonprofit older or newer? (e.g. Race for the Cure doesn’t have to spend as large a % of their donations on raising awareness for their organization as a newer organization does)
- does the organization have a handful of donors (or a single donor) who covers all of their overhead, enabling the organization to say that all (or a large %) of the money being donated to the org. goes to programs, thus slightly skewing the metric?
As engaged and intelligent participants in the work of social justice, we absolutely should do our homework and gather facts, metrics, etc. on the front end in order to make the most informed decision possible when it comes to our charitable donations. My caution is simply to keep in mind that the metrics we often use to make this decision are far from perfect; be slow to take the data you collect at face value. Ask yourself questions such as those outlined above before making a final decision.