Charity Navigator’s New Outlook on Success Helps Orgs that want to Look Good

Charity Navigator, one of the largest online source for evaluating nonprofit groups, is tweaking their website in an effort to help organizations provide more – and broader – information about themselves and their impact. With year-end appeals and direct mail campaigns hitting donors doorsteps, it couldn’t have come at a more opportune time for the orgs. Until recently, if I wanted to assess a charity, all I really have to go on are administrative-cost ratios and other financial metrics that, for the most part, make no sense to me.

Charity Navigator had been using a system of awarding one to four stars to charities based mainly on financial measures, like how much organizations spend on fund-raising and the ratio of their administrative costs to their overall revenue.

That focus, on an organization’s expenses in particular, rankled its critics, who contended that choosing a charity based on its administrative costs was a poor way of making sure donations did the most good.

Over all, there is a trend toward new ways to measure a charity’s effectiveness in delivering services or results. Over the next three years, Charity Navigator plans to add evaluations of a nonprofit’s accountability and transparency to its ratings, as well as research on its impact and research by other organizations.

Some individual charities have begun offering up more of their own information in public formats, to help benefactors make these assessments.

Now, the question is: will people give a damn?

One of the most talked-about surveys of donors this year suggests donors may greet these efforts with a big yawn. Only 35 percent do any research before making a gift, and only 10 percent use services like Charity Navigator as their primary source of information about nonprofits, according to research by the firm Hope Consulting.

Charity Navigator believes that by making the information easier to read and readily available, donors will become more interested.

At present, their  Web site, is on track to tally 4.7 million visits this year from some three million unique visitors. Traffic to the site has increased every year but 2009, a dip he attributed to the recession.

Check out Charity Navigator.

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