A one dimensional rating system, like the one Charity Navigator launched in 2002 to rate the Financial Health of charities, can be done with a simple addition of scores. But rating charities on two distinct components – (1) Financial Health + (2) Accountability and Transparency – in such a way that charities must excel in both areas in order to score well overall, requires a more complex calculation. In our two dimensional rating system the overall score is not a sum, but rather a measurement of the distance of two component scores from a perfect score of 100 and 100. The smaller the distance to the perfect score, the better the overall score. Mathematically, the formula we use to calculate the overall score is:
Although the calculation used to determine the overall score is complex, the rating table used for Financial Health, Accountability & Transparency and the Overall Rating is the same as illustrated below.
|Overall Rating:||0 Stars||Donor Advisory|
|Overall Score:||≥ 90||80 - 90||70 - 80||55 - 70||< 55||N/A|
Visualizing the Math
To help understand the calculation for determining a charity’s overall score, we provide a visual tool on each charity’s rating page. The following graph is an example of what is shown on the ratings pages. In this example, the charity has a score of 88 in Financial Health (3-stars) and 77 in Accountability and Transparency (2-stars). Following the 88 score on the vertical scale and the 77 on the horizontal scale to where they meet, it is easy to see that the charity earns a 3-star overall rating.
You can also plug the charity’s two individual component scores – (1) Financial Health and (2) Accountability and Transparency – into the boxes below. This tool will perform the complex distance formula calculation for you so that you can easily obtain the charity’s overall score.
|1 - Financial Health Score||2 - A&T Score||Overall Score|