Charity Navigator is America’s largest and most influential charity rater. We had over 7 million visits to our web site in 2014 alone and impact approximately $10 billion of charitable donations each year. This makes Charity Navigator far and away the largest and most utilized charity rating service that exists anywhere.
Over the past few years Charity Navigator has been working to expand our rating system (which originally only considered Financial Health) with the ultimate goal of including what we believe are the three dimensions of a charity’s operations that a informed charitable givers/social investor needs to consider before donating to them:
In 2011, we expanded our rating analysis to include dimension 2 (CN 2.0) - Accountability and Transparency. In January of 2013, we launched Charity Navigator’s newest rating dimension – what we call Results Reporting – which begins to address the final dimension of information we believe donors must consider to make a wise giving/social investment decision – the charity’s results reporting. By results we especially are interested in the outcomes of the work of the charity and whether these results are providing a social value (in other words, offering meaningful change in communities and peoples’ lives). Mission related results are the very reason that charities exist. Therefore, it is the most important dimension of all for our rating system and yet the hardest to measure due to the tremendous variation in the work that charities do as well as the lack of standardized public reporting on results by most charities. However, after years of research and with the advice of many experts, we believe we have taken a major step forward by adding this new dimension to our rating system.
CN 3.0 will include a dimension focused on the quality of reporting of results that charities provide to the public. We believe this will highlight those charities that are high performing and results oriented, as well as encouraging other charities to become so. The Results Reporting dimension considers several elements that you can learn about by going to the methodology section of our web site and by looking at the first three charities (Roca,Dave Thomas Foundation for Adoption and the Alliance for Children's Rights) that we collected the data for the new methodology. In addition, you can read the detailed Concept Note.
We plan to implement the new Results Reporting dimension as follows:
Although we are hopeful we can achieve the full implementation of CN 3.0 within four years, in reality the resources available to us will determine how quickly CN can fully implement CN 3.0. Charity Navigator is itself a charity and we do not charge a fee for our services to users, nor do we charge the charities to be rated or to use our analysis in their fundraising and marketing endeavors. Instead, CN relies on the voluntary donations of our Board members and our users, as well as advertising revenue, data sales and grants.
Paul Brest (Professor of Law, Emeritus and Former Dean of Stanford Law School and former president of the William and Flora Hewlett Foundation) recently reviewed the Results Reporting methodology and concluded that, “This is the most important work being done in the nonprofit sector”. We believe it is that important because donors will have access to much more robust information than ever before about each charity’s ability to bring about long lasting and meaningful change in the world. It is also important because many more charities will become focused on measuring and managing their performance. In other words, we believe this work and the new rating system that is evolving out of it is critically important because our users will be able to direct even more money to high performing charities. Ultimately we believe this will lead to a significant and measurable improvement in human welfare and acceleration in solutions to our world’s most persistent problems.