Charity Navigator's new evaluations

On Monday, November 29, 2010, the NY Times printed To Help Donors Choose, Web Site Alters How It Sizes Up Charities.   The article discusses how Charity Navigator “recently embarked on an overhaul to offer a wider, more nuanced array of information to donors who are deciding which organizations they might help.”

Charity Navigator’s site will track approx. 3 million unique visits in 2010, according to their statistics.  They, along with sites like Guidestar, are one of the largest online sites for evaluating nonprofits. 

The article states:

“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.”

What I want to know is, how is it going to measure “accountability” and “transparency?”  And what about “impact?”  How will that be measured? 

I’d like an example, such as for an NGO that provides food relief.  Will they count how many people received the food? And what kind of quality was the food?  How it distributed?  And was there any violence in that distribution setting or was it peaceful and fair? Was there any waste in the distribution?  Is there corruption?  Or is that just the “price of doing business”? I could go on – you get the point. 

More hope, it appears, is emerging from the nonprofits themselves.  Take, for example, the Children’s Tumor Foundation:

“Some individual charities have begun offering up more of their own information in public formats, to help benefactors make these assessments. For instance, the Children’s Tumor Foundation has begun reporting on its finances using the same format as the 10-K, the annual report that public companies must file with the Securities and Exchange Commission, in the belief that it is an easier and more comprehensive way for donors to see how it operates.”

The 10K is more revealing of its operations as opposed to the newly revised 990, which nonprofits are required to file.  How revealing!

The number of articles about this topic is heating up.