We are thrilled to announce a new feature on more than 2,300 of our nonprofit reports that focuses on impact—an increasingly important metric that donors are searching for before deciding where to direct their charitable contributions. This new area, which we’re calling the “Impact Tab,” signifies a complete merging of GuideStar and Philanthropedia databases, which we acquired in early 2011. You can see an example of the Impact Tab at the bottom of this blog.
How it works: Nonprofits granted a “Top Nonprofit” medal from Philanthropedia—organizations that have received recommendations by foundation professionals, academics, researchers, nonprofit senior staff, and other field experts about the nonprofits’ high impact—will now have information about the evidence of their impact, organizational strengths, areas of improvement, and expert quotes displayed in a new section of our standard nonprofit reports. Additionally, our Quick View summary at the top of the nonprofit report will show a green checkmark if the expert information is available.
Why we’re leading the charge to focus on impact: First, let’s describe the term. We define impact has the outcomes of an organization’s work to serve and achieve its mission. Our Money for Good II research, conducted by Hope Consulting, shows that among all of the pieces of information that donors and funders want to see about nonprofits, the greatest unmet need in the philanthropic sector is information about impact and effectiveness. The research found that donors and foundations want trusted third-party portals, like us, to provide this information to the general public, and we have spent the last year or so speaking and writing about the shift in the sector from transparency and accountability to impact and effectiveness. Erinn Andrews, our senior director of nonprofit strategy, said it best: “Although it’s important to have a financially healthy and mission focused organization, those measurements don’t guarantee that a nonprofit is effective at fulfilling its charitable goals. By measuring an organization’s impact, donors and funders can discover nonprofits that are really doing the most good.”
Why the sector should move past the overhead ratio as a measure of success: A nonprofit’s overhead ratio, which is too often the sector’s metric of choice when determining worthy organizations, is only one piece of the overall puzzle that people should consider. We had already included a nonprofit’s own description of its impact, as reported through the GuideStar Exchange program, in an area of the nonprofit report titled “Impact Statement.” The new Impact Tab is entirely from third-party experts, and underscores our commitment to helping people make informed charitable decisions and focusing energies on high-performing nonprofits.
What nonprofits can do:
Leave a comment in the Impact Tab
Another feature of the new Impact Tab is a section called “From the Nonprofit,” where nonprofits with expert reviews can e-mail a request to leave a comment in the Impact Tab to email@example.com. To see examples of the new Impact Tab, visit two of Philanthropedia’s Top Nonprofits: Water for People and Teach for America.
Participate in Philanthropedia’s research
Experts are asked to identify effective nonprofits working in the area of their expertise. Senior nonprofit staff members are encouraged to e-mail firstname.lastname@example.org to request an invitation to participate in Philanthropedia’s research in their respective cause areas. Staff members should send their name, title, e-mail, phone number, organization name, and the cause they believe their organization falls under. For more about Philanthropedia’s crowd-sourcing methodology when assessing impact, click here: http://www.myphilanthropedia.org/how_we_rank.
How do you define impact? How are you presenting your organization’s own effectiveness to donors and other stakeholders? Please leave us a comment and tell us more.