Charities’ Zero-Sum Filing Game

By    May 29, 2012

The minimalist ratings of nonprofit organizations, using overhead and fundraising ratios, are deeply flawed. Are we collectively making the situation worse by shaving the numbers? A recent study found that over 40% of nonprofits report zero fundraising expenses, which suggests nonprofits can’t be trusted to share information in the public interest and the rating agencies are all that more essential. Our collective actions are feeding the current system rather than demonstrating its irrelevance through honest, open and more comprehensive and meaningful data. (Full disclosure: NAS does not raise money from individuals and therefore lists its grant-related expenses under business development rather than fundraising.)

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