Over the holidays I wrote a blog post about how to pick a great nonprofit to donate to with extremely minimal work. That post spurred Lucy Bernholz to write two posts (part one and part two) about her effort to help a 10-year-old pick a nonprofit to support.
Lucy’s posts were great because out of the need to communicate nonprofit due diligence best practices to a 10-year-old, Lucy manage to distill everything down to three simple questions:
- What does the organization do?
- How do they do it?
- How do they know if they are making a difference?
I’ve written up my own list of five simple questions to ask, but they are a good deal more technical. Sometimes I think the “smart giving” movement gets lost in our own nuanced debates and forgets how powerful it can be to reframe our discussions so they make sense to anyone (in this case, a motivated 10-year-old ended up being the perfect foil for Lucy).
Here’s why I think Lucy’s questions are so powerful and are the core of what more complex evaluation processes are trying to get at.
What does the organizations do?
This seems to be such an obvious question that it doesn’t need to be asked. But visit the Red Cross’s website and try to explain what they do. Or check out the American Cancer Society, which many people think does cancer research, and then realize that only 17% of their program expenses go to research.
Understanding what an organizations actually does should always be the first step to building conviction in a decision to support them. A good answer to this question can’t just discuss the organization’s goals or focus area, but should describe the programs or approaches taken by the nonprofit in pursuit of those goals.
How do they do it?
The question above might be answered above for a college access nonprofit that the organization provides assistance to under-privileged high school students in the process of applying for college. But lots of nonprofits do that sort of work, so how does the nonprofit in question provide the service? How does their service differ from similar organizations? How do they fund their activities?
How do they know if they are making a difference?
Any high performing nonprofit is going to have some process in place for trying to get a handle on whether they are having success in their programs. The answer to this question doesn’t need to come in the form of a spreadsheet. It might be completely qualitative. But regardless of how it is answered, a solid nonprofit should be able to speak convincingly about their own efforts to know if they are making a difference.
In some ways, that’s about all you need. If before you make a donation you are able to fully describe what an organization does, how they do it and how they know if they’re making a difference, you are well on your way to knowing that your money is actually going to make a difference.
I’m sure some people will argue that this is too simple of a process. My own advice on this matter requires that a nonprofit base their programs on evidence about what works or, if the program is experimental, make clear that the program is a research effort. But we can go on adding qualifications and additional due diligence forever.
In a world where most people do little to no research before donating, it seems to me that a big positive shift would occur if donors began to spend 15 minutes figuring out the answers to Lucy’s questions before making a donation.