According to the National Center for Charitable Statistics, there are currently over 1.5 million nonprofit organizations in the United States. With so many to choose from, how do you determine which ones to support? Whether you’re evaluating a proposal or simply want to know which organization will make the best use of your donation, getting answers to the following questions can help you make an informed decision. And thankfully, many of the answers may be as close as your laptop.
Although you may want to obtain additional information before committing your funds, and some donations (such as multi-year commitments or significant gifts) might even merit an in-person visit, reviewing a nonprofit’s website is an excellent first step, providing a better sense of both the organization and its programs. As you browse, here are some questions to keep in mind.
1. DOES THE ORGANIZATION HAVE A CLEARLY ARTICULATED MISSION STATEMENT
Look for specificity. Vague, ambiguous intent (“dedicated to making the world a better place”) often leads to vague, ineffectual projects. What is the overriding purpose of the organization? Is it clearly focused on serving the public interest? Does it appear focused with laser-like precision on a defined goal, or does it seem more interested in “raising awareness”?
2. ARE THE NONPROFIT’S VALUES CONGRUENT WITH YOUR CORE BELIEFS
Let’s say that you are interested in reducing urban violence. You find an organization that is precisely aligned with your agenda. A closer look reveals that they’re focused on passing tougher gun control laws as they consider the prevalence of handguns to be an important, underlying cause. Depending on whether you agree with their stance, they may or may not be the right fit. Shared goals are important, but so are aligned convictions.
3. DOES THE ORGANIZATION MEET A VITAL NEED
Perhaps the most important questions you can ask are also the most fundamental: Does the organization matter? Is there a clear need for its services? To begin to answer these questions, ask for hard data on the extent of the issue or problem the organization purports to address. Do the organization’s services and projects fill a gap, meet a need, develop a skill or talent, or build on an opportunity to solve a problem? What is their target population and what percentage of that population does the organization serve? Can you tell whether these numbers have increased over time, or has there been a decrease in the number of individuals served?
4. HOW SOUND IS THEIR STATED APPROACH
Different nonprofits will approach the same problem from different angles. In practice, this means that you’ll need to evaluate each organization’s strategy on its merits. Is there an inherent logic to their proposed approach? Does it make intuitive sense? Is the program unproven or based on solid evidence? If so, do they cite the results of the research on which the program is based?
5. ARE THEIR SERVICES AND PROGRAMS UNIQUE OR ARE OTHERS DOING SIMILAR WORK
How does the organization differ from other nonprofits operating in the same philanthropic space? Is there a need for multiple organizations working in the same sphere? To compare nonprofits with a similar focus, many donors visit the websites of various “watchdog” organizations. These sites apply a uniform set of standards to analyze and grade the financial and programmatic quality of nonprofit organizations. Some of the more popular nonprofit rating sites include Charity Navigator (www.charitynavigator.org), the Better Business Bureau Wise Giving Alliance (www.give.org), The American Institute of Philanthropy (www.charitywatch.org), and Give Well (www.givewell.org).
6. HOW DOES THE ORGANIZATION DEFINE SUCCESS…AND HOW DOES IT KNOW THAT IT IS SUCCEEDING
Although nonprofits often struggle to quantify outcomes, an organization should have more to offer than a few touching anecdotes. How does it measure success? Is there tangible evidence that it is succeeding in addressing its articulated goals? Have they posted any bottom line results? If the organization doesn’t publicize results of any kind, consider it a red flag.
7. WHO SITS ON THE BOARD
As part of your assessment, look at the board’s composition. Are nominees to the board logical and thoughtful, or is the list of names seemingly chosen at random? Is the board dominated by the founder and a few insiders? Ideally, the board should be comprised of a mix of influentials and funding “rainmakers” as well as those with expertise relevant to the organization’s mission.
8. HAS THE ORGANIZATION BEEN TAINTED BY CONTROVERSY
Google the organization’s name to see if it has been in the news. Has there been any recent positive or negative attention? Does the nonprofit seem to enjoy a solid reputation? Have there been any allegations of bad conduct? Even if you suspect that the organization has been falsely or unfairly tarred by controversy, bad publicity in the nonprofit world, whether or not it’s deserved, can compromise an organization’s ability to effectively serve its target population.
TAKING THE NEXT STEPS
If you’re not finding the information you need—or if the information you’re finding leaves something to be desired—you might want to call the organization to fill in the blanks. And if you’re contemplating a sizable gift or ongoing commitment to an organization, you might want to gain an “on the ground” perspective through site visits.
Although getting the answers you need to make informed decisions is the ultimate goal, many people find the fact-finding process itself rewarding. By learning more about how nonprofit organizations approach their work, fund their efforts, and measure their results, you gain valuable experience. With time, you’ll acquire the skills to determine when your donation isn’t just a gift, but an investment in progress.