Welcome to the Charitable Measurement Initiative!

The Charitable Measurement Initiative is a collaboration of people and organizations that are deeply committed to the belief that social change organizations can mobilize significant new and better investment if they are able to implement a measurement reporting framework that credibly communicates their real impact to donors. The Initiative is directed by GiveIndia and calls on the resources of pilot program partners Keystone Accountability, Global Giving, and New Philanthropy Capital, as well as many other organizations committed to social welfare.

The process began when we decided to combine our previous experiences in humanitarian and charitable work with our current work as corporate lawyers. We sought to find a group in India that was looking to incorporate capital markets/securities concepts in reporting and analysis to create more valuable and transparent information.

Thankfully, we were put in touch with GiveIndia. Give discussed the idea of running a pilot program implementing the Keystone framework developed by Keystone Accountability to see if we could help organizations more clearly articulate the outcomes they wanted and better communicate their actual results to donors. This was exactly what we were hoping to do and gladly agreed to donate a year of time to making this work.

While we were in London, Give put us in touch with Keystone Accountability and New Philanthropy Capital. After many meetings throughout the spring and summer, we arrived at our joint creation – the Charitable Measurement Initiative – and a plan as to how we would seek to help NGOs in India become more transparent, responsive, and efficient, as well as help donors become more engaged and involved.

Wednesday, February 20, 2008

Keystone's Study of Social Marketplaces

Our friends ate Keystone have just published a remarkable study of social market places that is available at: www. keystoneaccountability.org/node/159.

It tracks and examines the growth of online philanthropic marketplaces and their potential to create an informational basis for results-oriented giving and encouraging greater accountability.  The study finds that while there is great potential and the marketplaces are doing remarkable work, there is still a need for clear criteria to determine effectiveness and impact.

It's a long read but worth reading through during train rides.

Sunday, February 17, 2008

Franziska Zeiner's Blog on Indian NGOs

Our friend and co-worker Franziska Zeiner is creating a photo-blog capturing many NGOs in India.  There are great photos and excellent commentary.  If you are interested in finding out about Indian organizations that could use some support, this is a great reference.

http://clicksonngos.blogspot.com

Tuesday, February 12, 2008

Interview with Fay Twersky

http://www.alliancemagazine.org/online/html/aonov07a.html

Here is a link to a Fay Twersky interview from November 2007. It discusses some key issues related to impact measurement. Ms. Twersky is Director of Impact Planning and Improvement at the Gates Foundation and has great insight on the topic.

Monday, February 11, 2008

Allowing for Growing Pains

Some preliminary feedback on our reports suggests that we may need to make two forms of reports, one for HNIs and one for corporate donors. The HNI reports need to be shorter and more anecdotal. The corporate reports need to be closer to financial disclosures.

We have generally leaned toward the corporate model, shying away from photos and anecdotes because we don’t want to encourage that type of behavior. Also, it is difficult to verify such stories unless we actually listen and make a record of those stories. It would be great if we could, but given our resource limitations, we are trying to figure how to “humanize” our reports without having to reply on the NGOs for their stories because we can not be 100% certain that they are correct.

One of the dangers in measuring the effectiveness is that it might dissuade the innovativeness of the projects funders are prepared to support. Measures if not tailored correctly will be overly harsh on new groups as they test out new interventions and approaches to solving problems. If this is calculated without some leniency for such innovativeness these organizations will look worse and donors may shy away from them.

Thus, measurement standards must strike the right balance between innovation and effectiveness. This means that means that measurement frameworks, especially in the beginning of an organization’s life, must to be tailored to allow for innovation. As a organization grows and matures, more stringent measurement criteria can be applied.

The key point is that a “one-size-fits-all” approach will not work.

Friday, February 8, 2008

Tailoring Reports for Different Donors

Some preliminary feedback on our reports suggests that we may need to make two forms of reports, one for HNIs and one for corporate donors. The HNI reports need to be shorter and more anecdotal. The corporate reports need to be closer to financial disclosures.

We have generally leaned toward the corporate model, shying away from photos and anecdotes because we don’t want to encourage that type of behavior. Also, it is difficult to verify such stories unless we actually listen and make a record of those stories. It would be great if we could, but given our resource limitations, we are trying to figure how to “humanize” our reports without having to reply on the NGOs for their stories because we can not be 100% certain that they are correct.

Thursday, February 7, 2008

Good idea but maybe think about what people actually need?

I was on Facebook today when a pop up add came up with a picture of a young Indian girl and said "24 Hour Famine". So I googled it and it turns out that World Vision is asking people to get sponsored "to go go without for 24 hours, so that someone else doesn’t have to." The idea is to raise funds and awareness for a new project they are doing for street children in Chennai.

While I applaud their efforts -- which are laudable -- it is proper nutrition rather than starvation that is an issue in India. I point this story out only as an example of what we have seen with foreign organizations in India. They often intervene with the best of intentions but with preconceived notions of what should be done. And those preconceptions often are incorrect and therefore lead the organization astray.

This is why it is not only important to consult with experts but also with stakeholders and beneficiaries. They will give you a better picture of the problem and correct misconceptions.

Wednesday, February 6, 2008

NY Times Article on Education Highlights Major Issues

Here is a NY Times article on education in India. It points out some of the issues we have seen in India: (1) mistrust of public education; (2) consumer driven culture; (3) increase in the cost of living; (4) lack of attention to the rural problems; and (5) middle class resentment of helping the poor.


http://www.nytimes.com/2008/02/06/world/asia/06school.html?_r=1&oref=

Tuesday, February 5, 2008

Donors' Level of Engagment Is Crucial to the Success of Unrestricted Funding

“If it happens without intermediation, our experience shows that it rarely succeeds because donors don't have that kind of time to engage in detailed discussions[.]”

That is a quote from one of the groups we trust the most. We asked them whether from the beginning we would be able to go for unrestricted funding and what he thought of the concept. Their belief was that it would only be possible if the donors were willing to take up a lot of the monitoring role and be actively involved because otherwise it would be very hard for the donor to judge success at some future point in time. Their point was that they believed that the donor would not be satisfied with a report one year later detailing the use of his or her money if there wasn’t some predetermined way to measure the use through a project or target.

This comes from a respected group so we are taking it very seriously. However, our belief is that we can get donors to understand that they are funding social change and are part of this process of change. This process requires flexibility and non-project based funding to target a range of conditions. And through our discussions and reports, we hope to encourage such a system/relationship.

We do believe we can get donors to be satisfied with such reports one year later, but the concern expressed in the quote is valid. For this to work, donors are going to have to have the time to engage. What we need to do is make that time as little of a burden as possible.

Monday, February 4, 2008

Additional Concerns about Unrestricted Funding

Here are two other concerns that were passed on to us:

(1)
Because most donors do not proactively ask for the full set of the NGOs accounts, they are unlikely to be able to identify duplicate allocations. We need to make sure that donors understand this problem and ask for the information. But because they probably do not have enough time to look over many records, either we will have to do it to provide assurance or train them how to do so. Ideally, we would like them to do it because it fosters a closer and more involved relationship, but practically, I don’t think it will happen until further into the relationship.

2) NGOs sometimes fail to utilize their funds at all if they are not tied to a specific project. For example, when NGOs raise money through fundraising efforts that yield unrestricted funds (like from marathon sponsorship), they often hold on to that money in a corpus account or try to spread it over the course of the year. While it may be necessary in certain cases, we do want to encourage funds to be used and not sat upon. There is always a chance of misuse or underuse when funds sit for a while.

Saturday, February 2, 2008

Concerns about Unrestricted Funding

Another concern that we have heard several times is that unrestricted funds often lead to misuse, especially duplicate allocations (where more than one donor is given reports of the same project). We have heard stories of where this has happened with some of the most reputed large NGOs.

In its most innocent form, it is done so that funds earmarked for one project are used temporarily for another and later when additional funds come in, they original project will be completed. This happens most often when an NGO has definite income coming to it, but because of some problem with a project, is forced to scramble a little. The more serious form is outright fraud.

We do not approve of either of these forms. What we want is open discussion and some element of unrestricted funding that allows for discussion as to what needs to done to solve social problems with flexibility to cope with problems that pop up.

Like we mentioned in our last post, we are seeing a strong tension between unrestricted funds and honest usage and reporting. Based on what we are hearing, at least initially, there will have to be some form of restriction.

Friday, February 1, 2008

Intermediaries’ Complaints about NGOs

Having had discussions with intermediary people and organizations (that is, groups like CMI) who have overseen many donor-NGO projects in India first-hand in the last 1o years, it is clear that their overall impression is that many Indian NGOs do not respect the freedom that comes with unrestricted money. The most common complaint is that many NGOs are not proactive in engaging donors and do not communicate to donors the challenges that the organization will or could face. They also complain that there is little to no meaningful stakeholder dialogue on an ongoing basis. As a result of these failures, the intermediaries say that they have often seen that even when NGOs receive money they do not take reporting seriously unless future disbursements are linked to reports. Without some sort of punishment, they fear that NGOS just won’t report honestly and complete and will not develop an honest relationship with their donors.

Based on this fear we are rethinking what it exactly means to get unrestricted funds. If we take these fears seriously, then purely unrestricted funds are unlikely to work or encourage the type of interactions and dynamics that we would like to see.

Our current thinking is that there will have to be strict timelines and reporting obligations, all of which are clearly outlined in a MOU signed by the NGO and donor and use an intermediary (like Give) to facilitate some of the exchanges.

The key will be doing so while giving the flexibility to use funds as may be needed. Clear project guidelines with clear timelines are easier to monitor but they handcuff the NGO and we believe are not the best for meaningful, sustainable development. While we would ideally encourage active donor-NGO engagement so that the donor takes up some of the monitoring and the NGO is responsible for frequent reporting, it is impractical because the donor is unlikely to have the time. Therefore, it is likely that initially the funding will have to be loosely restricted and as trust builds, the funding will become more unrestricted.