Navigating the Evaluators

I recently gave a keynote address for a conference of nonprofit leaders in Oregon. At one point, I asked people to raise their hands if they thought that the evaluation methodology of Charity Navigator, the country’s most popular nonprofit rating system, had validity. Nobody moved a muscle.

Then I asked: “So for those of you whose organization has received a top 4-star rating from Charity Navigator, raise your hand if you placed that rating on the home page of your website.” Dozens of hands reluctantly rose, accompanied by embarrassed laughter.

That moment crystalized both the charitable sector’s lack of respect for nonprofit evaluators, and its recognition of the evaluators’ influence. Continue reading

Share this: Facebooktwittergoogle_plusredditlinkedintumblrmailFacebooktwittergoogle_plusredditlinkedintumblrmail

Giving, When You Have a Lot to Give

The rich have always played a leading role in charitable giving. Now their role is getting larger. In fact, soon the middle class may not even have a speaking part.

The growing domination by the very wealthy in philanthropy is the central topic of the new report “Gilded Giving” from the Institute for Policy Studies. Authors Chuck Collins, Helen Flannery, and Josh Hoxie write how over the last decade a growing percentage of charitable giving in the United States has come from the highest earners. Over that period itemized charitable contributions by the top one percent have increased by 57 percent; itemized contributions from people making $10 million or more – essentially, the top tenth of the top one percent – are up 104 percent.

And what of the middle class, defined for the purposes of the study as families earning less than $100,000? The statistics are less definitive, because a significantly smaller percentage of middle- and lower-income taxpayers itemize their deductions. But for those who do, charitable donations have declined by 34 percent. The report also suggests that over the same period the number of low- and mid-range donations to national charities has declined by 25 percent.

So if we are to believe this report – and I tend to do so –  fewer people of modest and average means are giving to charity at all, while those who are still contributing are giving less. Continue reading

Share this: Facebooktwittergoogle_plusredditlinkedintumblrmailFacebooktwittergoogle_plusredditlinkedintumblrmail

Wall Street 9, Charity 0

The news last week was stunning, but at the same time utterly unsurprising: When The Chronicle of Philanthropy compiled its annual Philanthropy 400 list of the nonprofit organizations that had raised the most money in the United States last year, the top dog was not United Way or the Salvation Army, but Fidelity Charitable.

The finding sparked a series of stories around the country: The New Yorker,  The Washington Post , The San Francisco Chronicle, The American Prospect, and National Public Radio, to name a few. Journalists are gob-smacked by the idea that an affiliate of a financial services firm could claim the title of top charity – and that it did so by the hefty margin of $900 million over United Way Worldwide. (Last year Fidelity’s take rose 20%; United Way’s dropped 4%.)

But those of you who have been reading my rants about the commercial donor-advised fund industry have seen this coming for five years. It’s like watching the sea levels rise from climate change. We’ve long known what was going to happen. Now, the evidence is incontrovertible. I take some grim satisfaction in the news, but mostly I feel despair. Continue reading

Share this: Facebooktwittergoogle_plusredditlinkedintumblrmailFacebooktwittergoogle_plusredditlinkedintumblrmail

Starvation Diet

A friend who serves on a nonprofit board asked me whether her organization was drawing enough from its endowment each year. “Probably not,” I answered. Then she described her organization’s endowment spending policies. I was right.

Endowment spending policies are often discussed at board meetings, but rarely questioned. And the amount taken annually from the endowment in most cases is too little.

To understand what’s going on, we have to look at the social and power dynamics. Continue reading

Share this: Facebooktwittergoogle_plusredditlinkedintumblrmailFacebooktwittergoogle_plusredditlinkedintumblrmail

this is a test

Thoughts on the Nonprofit World