NGO Admin costs and overheads
Fundraising costs are not a measure of a charity's effectiveness | Voluntary Sector Network | Guardian Professional The Public Accounts Committee's (PAC) hearing on 7th March covering the Cup Trust and tax evasion highlighted the importance of public trust and confidence in charities and their principal regulator, the Charity Commission. The latest public trust and confidence in charities survey published by the Charity Commission shows that the vast majority of the public have positive perceptions of charities' conduct and intentions. Three quarters believe that most are trustworthy and act in the public interest.
The TED talk everyone in the social sector is talking about – and what needs to change If you have ever made a donation, let alone are in the social sector – you need to watch Dan Pallotta’s TED talk “The way we think about charity is dead wrong”. If you haven’t seen it, watch it now. (Yes, now.)
Why NOT to use overhead ratios as a way to compare NGOs 29/03/2012 at 2:16 pm We in Dóchas are very keen to promote Good NGOs, and to discourage funders to keep supporting Bad NGOs. And in doing so, we obviously need to have clear standards of what a “Good NGO” is. And that is not easy.
In defence of NGO overhead costs 18/08/2010 at 6:51 am Graham Heaslip, a lecturer at NUI Maynooth, recently published an article in the Irish Times, attempting to clarify some of the challenges facing aid agencies. The article, entitled “Key funds for NGO administration often neglected in rush to get aid to victims“, illustrates how aid agencies are effectively discouraged from investing in quality control by pressure from the media, fuelled by the myth that overseas aid must be based on good intentions and not incur the dreaded “overhead costs”. However, in overseas aid, as in most other areas of life, quality comes at a price. (See also: Why do we expect overheads at fast food restaurants but not in aid?) Admittedly, it is often difficult for people in Ireland to assess the quality of NGO work, for the simple reason that much of it takes place thousands of miles away.
As the network of Irelands Development NGOs, we promote greater transparency and accountability among our members, and . And we know that for NGOs to change, critical external scrutiny is essential. Our are based on the assumption that members of the public will help hold NGOs to account, and we work with politicians and journalists, to promote greater awareness of the work of Irish non-profits. NGO overhead costs
Identifying Effective NGOs
03/04/2012 at 4:15 pm Guest blog by Marguerite Hughes As highlighted by the resource lists recently compiled by Dóchas on this blog, there is a formidable opposition to the use of administration costs as a measure of NGO quality. Might it be time to stop talking about NGO Administration Costs?
Charities Must Battle Myths About Overheads By Dan Pallotta Nonprofit organizations build movements that mobilize people to fight the worst forms of human suffering. But when it comes to dealing with the systemic issues that undermine its true potential, the nonprofit sector has no movement to mobilize itself. And while nonprofits speak for those who cannot speak for themselves, they have no national voice to defend against investigative reporters, lawmakers, and others who attack them—often maliciously and incorrectly—for spending too much on executives’ salaries and on the overhead and infrastructure expenses it would take to grow. This silence comes with a cost. It makes it impossible for charities to get anywhere close to the scale required to solve the gigantic social problems that confront humanity.
The following letter to the donors of America was penned by the leaders of the country’s three leading sources of information on nonprofits – GuideStar, Charity Navigator, and BBB Wise Giving Alliance. The letter is made available the the public under the Attribution-NoDerivs Creative Commons license, which allows for it to be shared and distributed for any purpose so long as it remains unchanged. You may download a PDF of the letter here. To the Donors of America: We write to correct a misconception about what matters when deciding which charity to support. Letter to the Donors of America | The Overhead Myth
The experts have spoken: the percent of charity expenses that goes to administrative costs—commonly referred to as “overhead”—is a poor measure of a charity’s performance. JOIN US to end the Overhead Myth and start supporting nonprofit INVESTMENTS IN sustainability and success. In a historic move, the leaders of the country’s three leading sources of information on nonprofits – GuideStar, Charity Navigator, and BBB Wise Giving Alliance – penned an open letter to the donors of America denouncing the “overhead ratio” as a valid indicator of nonprofit performance. The letter, signed by all three organization’s CEOs, marks the beginning of a campaign to correct the common misconception that the percentage of charity’s expenses that go to administrative and fundraising costs—commonly referred to as “overhead”—is, on its own, an appropriate metric to evaluate when assessing a charity’s worthiness and efficiency. The Overhead Myth
Five myths about charitable giving It’s also astonishingly easy to start a charity. The Internal Revenue Service approves more than 99.5 percent of charitable applications, often in very short order. Because of this, the sector includes more than a few organizations that have little connection to common notions of doing good: the Sugar Bowl, the U.S. Golf Association, the Renegade Roller Derby team in Bend, Ore., and the All Colorado Beer Festival, just to name a few. 2.
It's probably the most frequently asked question in the entire charity world. And yet as any charity knows, it's irrelevant. To see off the question about running costs, talk about something else. How to stop donors asking about your administration costs | Voluntary Sector Network | Guardian Professional
Hard times for charities: A perfect storm or an opportunity? Charities may not be run for profit, but they still need to have high standards of corporate governance, writes Hans Zomer THE decision by Labour senators to apply pressure on the Government to regulate the 7,800 charities in Ireland that receive about €6bn a year in taxpayers’ money, and the protracted, internal disagreements at Goal have placed the charity sector under closer scrutiny. This comes when charities are under huge stress. Government funding has been cut, but demand for services is soaring. Charities find themselves more reliant than ever on the gener-osity of the public at a time when the public has less money to give. Charities must ensure society does not lose faith in them
Charities should not have to reveal salaries of highest-paid staff, sector bodies say By Beena Nadeem, Third Sector Online, 12 March 2014 Nick Brooks Charity and voluntary sector experts have warned against charities being made to reveal the salaries and job titles of their highest-paid employees in their accounts. The Charity Commission and the Office of the Scottish Charity Regulator have published all the responses not submitted in confidence to their consultation on an "exposure draft" of the new Statement of Recommended Practice.
Charities must be clear about the funding they receive, the money they spend, and the things they campaign for. Photograph: Leigh Prather/Alamy NPC (New Philanthropy Capital) published a report last week entitled Mind the Gap: What the public thinks about charities. It revealed that a third of the public say their views towards charities have become more positive over the past three years, compared with a quarter who are now more negative. This is despite prominent negative media coverage of the charity sector, including executive salaries and concerns raised by some over our campaigning activity. Despite this positive news, this is not a time to be complacent. Charities can't just expect the public's trust; they must earn it | Voluntary Sector Network | Guardian Professional
Overhead ratios: the amount of revenue that nonprofits spend on overhead expenses, as opposed to program expenses. It’s (thought to be) an indication of efficiency, and, by extension, efficacy. This makes sense – surely the best organizations don’t spend money on superfluous administrative costs? Low overhead ratios mean great nonprofits, right? » On overhead ratios and why they (don’t) matter Good Karma (the blog)
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Q: Are overhead ratios the perfect measure of NPO efficiency and effectiveness? « Nonprofit update
Fundraising costs are not a measure of a charity's effectiveness | Voluntary Sector Network | Guardian Professional