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Charity Navigators New Ranking and Review System

Posted October 26, 2011 1:56 PM by Dylan Miyake

We use Yelp.com to find great restaurants, Amazon.com to find quality products, and Consumer Reports.org to find everything from from the latest gadgets to the fastest sports cars.

Doesn't everyone want to know if they are getting a good deal? Don't we all want to know if we will love the result or regret it before spending any money? In the information age, everyone is looking online for this kind of insider-information before making a purchase.

In a very similar way, donors are going online before making a decision about who they support. And it's in your best interest to know what they are seeing to ensure that your hard-earned donations do not disappear.

Say I have $500 that I would like to go to a good cause. I can donate it to the local animal shelter, the little league baseball program, my alma mater, a veteran's support organizations, or any number of other mission-driven organizations. In fact, there are so many choices it's hard to even start.

Enter Charity Navigator, one of the nation's largest and most-detailed evaluators of charities. The dedicated professionals at Charity Navigator have spent over 10 years examining tens of thousands of nonprofit financial documents. Through this detailed process, they have developed an unbiased, objective, metric-based rating system to assess the financial health of over 5,500 of America's best-known charities. The rating system gives each charity one to four stars based on how responsibly it functions day-to-day as well as how well positioned it is to sustain its programs over time.

Great, so how does this apply to my Charity?

Well, that's exactly the point of this blog. Millions of people believe in the value of charity and understand the benefits of donating to nonprofits, and tax code even encourages it. But picking which Charity can be a difficult process. Donors need to know their contributions are going to a great cause, and that there is no mismanagement or waste along the way.

As a Charity, your "product" needs to look as good online as it is does in real-life. As a leader of a nonprofit or Charity, it's in your best interest to know what the reviews are saying about you, and really understand how this impacts a potential donor's decision to support your work. And even if you had a great rating last year, it's worth looking again, as the rubric has recently been enhanced to include new dimensions. Be warned, the new ratings are tough, more comprehensive, and have definitely raised the bar for being a top-rated organization.

In the words of the Charity Navigator President & CEO, Ken Berger, "...We've made a major enhancement to our rating system. We know that donors will welcome this change as it gives them more knowledge to do more good."

Because the new ratings are much more in-depth, Ken has been out and about discussing CN 2.0, Charity Navigator's newest charity rating system. In addition to financial metrics, rates charities along two additional dimensions--(1) transparency and accountability and (2) results reporting.

A short video featuring Ken as he talks about CN 2.0 is included below, or click the link to save your seat at the 2012 Mission Driven Management Summit, the premiere event for nonprofit and charity leaders who value strategic planning, effective management, and real, measurable results.

Filed Under Reporting