How Donors Can Maximize Social Returns

Leslie Crutchfield, who co-authored the excellent book Forces for Good about high impact nonprofits and was a guest on one of my podcasts, has written a really great article for the Washington Post titled How Donors Can Maximize Social Returns:

The global financial crisis has forced many donors to scale back their charitable giving, and nonprofit organizations are bracing for more severe reductions in 2009 and beyond. It is now more important than ever that philanthropists develop a focused strategy and strive to maximize the impact of their charitable dollars. Based on five years of research on a dozen of America’s top-performing nonprofits, here are four smart strategies for donors who seek to optimize social returns this year:

• Fund safety-net services and policy solutions
• Give fewer, bigger grants — without strings attached
• Leverage social innovation
• Look beyond conventional charity ratings

The article explains each bullet point. Most end of the year stories like this that run in major papers tend to focus on overhead expense ratios and actually encourage donors to fund organizations that have limited capacity (in direct opposition to the Hardvard Business Reviews suggestion that donors “invest in good overhead”). Leslie knows her stuff and it is great to see the Washington Post (who has recently named a full time philanthropy reporter) join the growing ranks of major papers who are starting to take philanthropy seriously.