Country's Largest Charity Evaluator Expands Analysis

The folks at Charity Navigator do incredible and important work by evaluating the stewardship of donor dollars.  Every nonprofit should follow their guidelines for what information to provide the public regarding the organization's management, structure, income, expenditures, etc.  Getting a good rating from Charity Navigator is important because it will assure your donors that you are responsibly and ethically using their money for good.  Bunnie

Country's Largest Charity Evaluator Expands Analysis

Charity Navigator's Enhanced Service Helps Donors Assess a Charity's Commitment to Accountability and Transparency

Donors will be in a better position to make informed giving choices now that Charity Navigator, America’s largest and most utilized charity evaluator, has expanded its analysis.

Since launching its service in 2002, Charity Navigator’s free financial evaluations --- which examine how a charity functions day to day and how well positioned it is to sustain its programs over time --- have changed the giving habits of the general public. But financial metrics are just the starting point in choosing a charity to support. Donors must also have access to information that considers a charity’s accountability and transparency practices and assesses its effectiveness and results. Starting this month, Charity Navigator is deepening its analysis by rolling out new metrics that examine the accountability and transparency component.

“Smart donors should require evidence of accountability and transparency from the charities they support,” said Ken Berger, President & CEO of Charity Navigator. “They should require this evidence because charities that are open about their performance and follow best practices in areas such as governance and donor privacy are less likely to engage in unethical or irresponsible activities and, as a result donations to such charities are a less risky investment.

“Charity Navigator was created with the goal of advancing a more responsive philanthropic marketplace, in which donors and the charities they support work in tandem to overcome our nation's most persistent challenges. We are thrilled to go beyond our financial ratings and take our analysis to the next level. By reviewing each charity’s commitment to accountability and transparency, we can help donors make even smarter giving choices.”

When examining the accountability and transparency of charities, Charity Navigator’s new methodology seeks to answer the following questions:

Does the charity follow ethical and best practices?

Does the charity make it easy for donors to find critical information about the organization?

Specifically, the methodology, which was developed in partnership with Charity Navigator’s staff, Board, Advisory Panel (http://www.charitynavigator.org/advisory), donors and nonprofit leaders, tracks the following:

1) A review of the charity’s website to determine if

Board members listed

Key staff listed

Audited financials and Form 990 included

Privacy policy posted

Inclusion of information about effectiveness and results

2) A review of the newly expanded Form 990 to determine if

The charity has made loan(s) to related parties

There has been a material diversion of assets

There are minutes for Board meetings

Copies of the Form 990 were provided to organization’s governing body

The charity has a conflict of interest policy

The charity has a whistleblower policy

The charity has a records retention policy

The charity disclosed its CEO’s name and salary

The charity has a process for determining CEO compensation

The Board is paid

The audited financials were prepared by independent accountant

An audit committee exists

As soon as the accountability and transparency data is gathered on a particular charity, it will be posted on its ratings page. However, no charity’s rating will be impacted by the results of this richer analysis until the data has been collected for all 5,500 charities in Charity Navigator’s database. For more information about Charity Navigator’s new Accountability / Transparency Methodology, please visit: www.charitynavigator.org/accountability. And to see a sample of a charity that has been reviewed for its accountability / transparency data, please visit: www.charitynavigator.org/accountability/list (more charities will display this data in August).

About Charity Navigator (http://www.charitynavigator.org/)


Charity Navigator is the largest charity evaluator in America and its website attracts more visitors than all other charity rating groups combined. The organization helps guide intelligent giving by evaluating the financial health of over 5,500 charities. Charity Navigator is a 501 (c)(3) organization which accepts no advertising or donations from the organizations it evaluates, ensuring unbiased evaluations. Charity Navigator, can be reached directly by telephone at (201) 818-1288, or by mail at 139 Harristown Road, Suite 201, Glen Rock, N.J., 07452.


Media Contact
Sandra Miniutti, Vice President, Marketing
(201) 884-1051
media@charitynavigator.org

A Grant Contract Isn't a Suggestion

I saw this article on Charity Channel and knew I had to "reprint" it! The truth is that you really do need to expend grant funds just as you promised you would. It may be tempting to apply grant funds to pressing needs, but if you want to get a second or third grant, the grantor has the right to know exactly where you spent every dime. Additionally, even if it is a one-time gift, the grantor has the right to ask for re-payment of funds if the money was not spent as was promised in the grant application or contract. Read and heed. Bunnie

A Grant Contract Isn't a Suggestion

by Rebecca Shawyer, Director of Grant Administration at Brazosport College

Throughout my career I have noted that far too often, program staff and administrators discuss and debate the meaning of the words "grant contract." What does this term really mean? Is it really a binding contract? Why can’t we buy that new computer we need? After all, we have grant funds left over.

Sadly, in the past I have found that some of my colleagues honestly believed that once grant funds have been received and deposited into the agency’s banking account, they were free to dip into them for any expenditure associated with the relevant grant project. As grant professionals, we know differently; and, it is our job to educate our colleagues before there is a problem.

So, what is a contract? The dictionary lists a variety of definitions for the word contract. Two that pertain to grant contracts are as follows: (1) “an agreement between two or more parties for the doing or not doing of something specified”; and, (2) “an agreement enforceable by law.” (Source: http://dictionary.reference.com/.)

“An agreement between two or more parties for the doing or not doing of something specified.” Hmm, this sounds quite clear. It doesn’t mention the possibility of loop holes or wiggle room. It clearly states “for the doing or not doing of something”. So why do program staff, accounting offices, and administrators offer think that it is acceptable to spend funds in ways not included in the grant contract?

I think that the answer is quite simple. Grant professionals oftentimes find themselves playing the role of a compliance officer because they failed to educate their organization and colleagues about the strict nature of any grant contract. It is our responsibility to take the time to fully explain contractual limitations prior to the signing of a contract.

I believe that this educational process should begin at the time grant proposals are being developed. In fact, I have found that it is crucial that everyone (including the president or CEO) clearly understands that the written proposal including its implementation plan, outcome objectives, evaluation plan, and budget will become an addendum to any future grant contract awarded. This is true for private foundation, corporate donor programs, and government agency awards.

Thus as I lead my college’s grant development teams, I consistently and constantly remind them that our eventual performance will be rated on that which they state will be done in the proposal narrative. In order to facilitate the development of ambitious but attainable goals and objectives, we develop a progressive program logic chart that clearly shows the relationship between program activities, minimum process objectives, staffing plan, equipment and supply purchases, and anticipated outcomes.

As we develop our grant applications, their attention is focused upon three primary issues:

The proposed program plan – With a contract award, the granting agency or foundation will expect that the proposed plan detailed in the application will be implemented as described with a minimum of changes. It will be assumed that as professionals, the program team has developed and proposed an implementation plan and strategies that are based on recognized and best practices in their field. If the team proposes to achieve that which is not truly attainable, it is likely that the organization will not be able to meet its contractual obligations if an award is received. If this happens, the organization could be endangering future grant awards and be putting itself in a position that requires the repayment of grant funds.

The budget – The budget needs to be realistic, accurate, and well thought out. After a contractual agreement has been reached, many funders will allow only minimal changes to the budget. Funds must be used for expenditures specifically listed in the proposal. For example, if the requested budget allocates $25,000 in salary expenses for direct service personnel, the agency may not pay administrative fees with these funds (unless the funder provides prior written approval of the change). For this reason, program teams should give as much attention to how the requested funds are being distributed as they give to the rest of the proposal. If funds are not properly allocated, the organization could find itself without adequate funds to cover key costs required for optimal implementation. If this happens, the funding agency will expect the grantee to find the needed funds elsewhere.

Equipment and supply purchases – Without prior written approval, equipment and supplies (such as computers, laptops, furniture, inkjet cartridges, etc.) cannot be paid for with grant funds unless they were included in the proposed budget. Additionally, if it was proposed that computers be purchased with the grant funds, these same funds cannot arbitrarily be switched to pay for new furniture.

After all, a grant contract is not a suggestion. Any grant professional that has ever survived a funder’s audit knows that it is in fact “an agreement enforceable by law.”

Contact Rebecca Shawyer at Rebecca.Shawver at BRAZOSPORT.EDU

Do You Have a Media Marketing Plan?

by Bunnie Riedel, Host, Nonprofit Conversation

Whether it’s new media or old media, getting attention for your organization can be a challenge. Remember, there are millions of Nonprofits out there and your organization is in competition with every one of them and the competition gets hotter when you narrow it down to just “like-minded” organizations.

I’ve recently had calls from several start-up Nonprofits wanting basic advise on what they need to do, whether it’s board development or how to incorporate as a Nonprofit or what kinds of grants they might pursue. I have a tool that I’ve developed to help me get to know them better and frankly, to help them focus. I call it a “marketing questionnaire” but it goes beyond simply “marketing” to drilling down on the who, what, and why of the organization.

I’ve found that people who start Nonprofits do so because they have identified a need in their community. Sometimes that need is to help the disadvantaged or to highlight a problem or even to provide peer professional networking. By and large, folks who start Nonprofits are highly altruistic, but that altruism doesn’t necessarily translate into framing a vision that is practical or sustainable. The marketing questionnaire can be daunting because it asks questions that may not have been asked previously. One Nonprofit entrepreneur exclaimed “You’re forcing me to come up with a business plan!”

“Yes,” I said “That’s the idea of the questionnaire.”

Every Nonprofit needs to step back from time to time and ask “Why do we matter?” If you and/or your board doesn’t know why the Nonprofit matters how can you convince anyone else that you matter? Maybe that’s the perfect way to start your next board meeting, spend fifteen minutes answering the question “Why do we matter?” Why you matter leads to being able to pitch media stories that will be picked up, it leads to creating relationships with media that will last over time, it leads to getting noticed.

Answering “Why do we matter?” also leads to finding out what is unique about your Nonprofit. As I said earlier, you are in competition with millions of Nonprofits and you are in heated competition with other Nonprofits who have similar missions. In order to get the 3 M’s (money, membership, media) your Nonprofit has got to stand out in the crowd. Take the case of two fictitious animal shelters:

Shelter One is fairly traditional. It receives stray animals, provides initial medical care, places them up for adoption and if not adopted in 120 days, euthanizes the animals.

Shelter Two not only receives stray animals, provides initial medical care and places them up for adoption; but it has an active foster parent membership, behavior rehabilitation services, web-cam capabilities so prospective animal owners can see the animals live and in real time, hosts adoption fairs at the local pet store, provides spay and neuter clinics to the public for a nominal fee and doesn’t euthanize but has a 100% placement rate (even for those hard to place animals).

Shelter Two is a marketing dream. There are about six stories that can be pitched for Shelter Two. And part of the Shelter Two pitch is how much better Shelter Two is than Shelter One.

Another question I ask is “Who is your target audience?” You can call it audience, constituency, membership, it doesn’t matter, what matters is the need to identify who you are trying to reach. I’ve seen Nonprofits mistakenly identify the entire world as their audience and unless your Nonprofit is the International Space Station, the “world” is not your audience. In identifying your audience you really need to apply some tough love. You may want to serve everyone, but can you? Think of it as “niche marketing.” If you can’t determine who your target audience is, maybe it’s time to pull out that mission statement and give it serious consideration. Figuring this out helps you narrow your pitch and narrow the field where you pitch and helps you be more successful because you are focused.

There’s more that needs to be explored but I’ll leave it for another time. If your Nonprofit doesn’t have a media marketing plan, now is the time to develop one. The competition for attention won’t get easier as time goes by it will only get tougher, especially in light of new media. This is an area that is woefully lacking for most Nonprofits and many simply do not include it as part of their regular programming activities and rarely give it a line item in their budgets. Your Nonprofit can stand out in the crowd if you include media marketing as an important component of your business plan.

Contact Bunnie at info at riedelcommunications dot com

Get a Policy Before You Chase Sponsor Dollars

How many times have I heard "We'll get a sponsor for that!" Often there seems to be a common belief that sponsors are like apples falling off a tree, just waiting to be thrown in a basket and taken home. We all know the pie is shrinking as people and organizations realize less from their investments. Now is a good time to be as intentional as possible about your sponsor program. Bob Crawshaw of Mainstreet Marketing (Australia) provides some global thinking on things an organization should do before going after sponsors.

Bob wrote me an email to tell me I could take the liberty of "americanizing" his spelling of certain words, but I prefer to leave it just as is because Nonprofit Conversation is now read in 65 countries and I am hoping we will have more international contributors to this blog! Bunnie

Get a Policy Before You Chase Sponsorship Dollars

by Bob Crawshaw, Maine Street Marketing

It’s tough times for not for profits and community groups everywhere are looking for revenue to keep the doors open and the lights on.

Australian groups are no exception. Many are facing increasingly tough times as people have second thoughts about where to spend their charity dollar – if in fact they have a spare dollar for a worthy cause.

Our PR agency in Australia’s national capital, Canberra, has provided free marketing support to 183 not for profits in the past five years. And we find a common reaction of groups with shrinking budgets is to say “let’s get a sponsor”. Across the not for profit sector the search is on for a large corporate to help fund something significant down to a small business to provide valuable in-kind support.

Since 2004 we have noticed very few medium sized not for profits and certainly most smaller ones lack a sponsorship policy. It seems the cupboard is bare when it comes to clear intent about their sponsorship ambitions.

Our workshops have always encouraged charities and community service organizations to set out a simple sponsorship policy to guide their efforts. Now the competition for the corporate cheque book is so fierce it is mandatory to have a sponsorship policy. It could be the one thing that separates fund raising success from failure.

The first step really belongs to your CEO and Board. They must set clear policy guidelines. They must also be right behind all sponsorship efforts and personally willing to devote their energies to the business of winning donors.

A sponsorship policy begins by clearly stating why your organisation wants outside funding and should explicitly state:

The types of large and small organisations to approach?

Which organisations to avoid, such as those associated with tobacco, alcohol, adult services, the arms trade and of course the environmental polluters.

What is the sponsorship property you are selling? Be crystal clear about what you’re offering.

How and where you will use the funds or services sponsorship brings in.

What benefits you plan to offer in return for sponsorship and are you willing to negotiate these?

Is there a budget to attract sponsorship, for example to travel to other cities to woo likely suitors?

Who in your organisation approves sponsorship arrangements?

Time limits on any sponsorship.

Who is responsible for servicing the sponsor and doing all the detailed work once the cheques are handed over?

I know that is a big list. But it’s better to think of these key issues now before your sponsorship marketing is in full swing.

Bob Crawshaw runs Maine Street Marketing.He began his communications career as the Australian Army's first Director of Public Affairs. He helps organizations with limited time and budgets get maximum community impact. Bob blogs PR at http://mainestreet1.blogspot.com/