August 13, 2009

New Discussions in Nonprofit Evaluation

The question of how to determine the success or failure of efforts to solve social and environmental problems is preoccupying many blog writers.

For charities, the most important discussion about evaluation may involve Charity Navigator. The charity watchdog in Mahwah, N.J. last year said it would start rating social-service groups and other organizations on how well they fulfill their missions, instead of judging them solely on their finances and governance.

On his blog, Ken Berger, Charity Navigator’s chief executive, is holding a series of “open forums” with nonprofit experts about how the watchdog can pursue this goal.

This week Mr. Berger interviewed David Bonbright, co-founder of Keystone Accountability, a nonprofit group that helps charities develop ways to measure their work and get views from their beneficiaries.

In a similar fashion, Ideo, a consulting and design company, has started a new blog with Good magazine to explore how innovative nonprofit groups and businesses can measure their “social impact.”

Sean Stannard-Stockton, author of the Tactical Philanthropy blog and a Chronicle contributor, writes that Ideo’s participation in this area is significant.

Another development in the evaluation world is the Global Impact Investing Rating System.

The system, which the Rockefeller Foundation helped create, will rate whether a social enterprise—nonprofit or commercial business ventures with charitable missions—is benefiting a specific cause, like health care or creating jobs in Africa.

Nathaniel Whittemore, director of the Center for Global Engagement at Northwestern University, in Chicago, writes on his blog, that the tool may need a few years to work out its “kinks,” but could lead to real changes in how philanthropic wealthy people and foundations make decisions about their investments and donations.

To be sure, as the possible tools to measure philanthropy and charitable for-profit work grow, some wonder whether the everyday donor cares.

“There seems to be a movement afoot to demand that donors like you and me insist on less ‘soft’ criteria for giving (like what they love or is personally relevant) and critically examine ROI [return on investment] based on standards,” writes Katya Andresen, a nonprofit marketing expert, on her personal blog.

“I believe this will never happen among the masses,” she says. “Most people give for profoundly personal and emotional reasons, and it’s going to take forever to get them to think like philanthropic investment bankers.”

What do you think? What other new developments are happening in nonprofit evaluation? Do you think everyday donors will pay attention to them?