Charity Navigator Updates Ratings, Web-Based Service Evaluates More Than 1,700 Non-Profits

Children's Miracle Network Earns Top Rating; SADD and PETA Rate Poorly

MAHWAH, N.J., Oct. 22, 2002 – Charity Navigator (www.charitynavigator.org) today announced new ratings of more than 1,700 charities, including 632 new organizations never evaluated before. The new, more comprehensive ratings will be part of Charity Navigator's online service as of midnight Tuesday, Oct. 22. The updated and improved site will feature more than 1,700 organizations, including 539 previously-listed charities whose ratings have been modified. Notably, 23 newly-rated organizations received zero stars, the service's lowest rating, including Children's Wish Foundation International, Firefighters' Charitable Foundation, Hale House, and Multiple Sclerosis Association of America.

The improved site offers several new features, including:

  • A "My Tools" section, modeled after financial sector sites allowing donors to compare charities by performance, income, sector or group.
  • Noteworthy "top 10" lists highlighting high- and low-performing charities.
  • New regional search capabilities.
  • Articles on charitable giving, polls, facts and special links.

Using publicly available tax returns (Forms 990) filed with the Internal Revenue Service, the Charity Navigator rating system evaluates a charity's overall financial health based on two broad areas, short-term spending practices and long-term sustainability. Within these areas, Charity Navigator looks at an organization's fundraising efficiency, fundraising expenses, program expenses and administrative expenses to show users how efficiently a charity functions on a day-to-day basis. To assess how well the charity sustains its programs over time, Charity Navigator looks at average annual growth of operating revenue, average annual growth of programs and services and working capital ratio. Based on how the charity rates in each of the two areas, it is assigned an overall rating, ranging from zero to four stars.

"We're perpetually looking for ways to improve our service," said Charity Navigator executive director Trent Stamp. "By adding more organizations and more user-friendly options, we continue to provide potential donors with the tools to help them decide which organizations are worthy of their donations."

Of the 1,748 charities evaluated on the site, Charity Navigator found that:

  • Total revenue generated by individual charities ranged from $4.57 billion (Harvard University) to $122,000 (Michigan Botanic Garden Foundation).
  • The highest compensation received by a charity's CEO was $776,243, and the average CEO compensation was $174,000.
  • Nearly three out of four charities examined by Charity Navigator spend less than 10% of their budget on fundraising costs and at least 75% on the programs and services they provide.
  • The average charity spends 80% of total functional expenses on programs, 12% on administrative costs and 8% on fundraising.
  • The average charity spends 10.6 cents to raise $1 in contributions.

Charity Navigator is itself a not-for-profit organization. The service is free, and the site is easily navigable by charity name, location or type of activity. Links are provided for all evaluated charities allowing potential donors to easily review each charity's website and quickly send a contribution.

About Charity Navigator:

Charity Navigator guides intelligent giving by evaluating the effectiveness and financial health of more than 1,700 charities. By accepting no advertising or donations from the organizations it evaluates, Charity Navigator ensures that its evaluations are unbiased. A 501 (c)(3) organization, Charity Navigator can be accessed at www.charitynavigator.org, or by telephone at (201) 818-1288, and by mail at 1200 MacArthur Blvd, 2nd Floor, Mahwah, N.J., 07430.


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