Wednesday, June 19, 2013


Like many leaders in the nonprofit sector, I have long considered overhead ratios - comparing the amount your nonprofit spends on administrative expenses aka fundraising to the amount you spend on programs - as a flawed way to measure the impact of nonprofits.

I'm pleased to see that Guidestar, BBB Wise Giving Alliance, AND Charity Navigator have all teamed up to take a look at this maniacal metric.

Check out the Overhead Myth below.

No one is suggesting that nonprofits be frivolous with our donors money.  Quite the contrary, we're suggesting that we - the leaders of charitable organizations - be empowered to make the best and highest use of our donors' investments by allocating donations such that they make the biggest IMPACT on critical issues, like ending global poverty, curbing climate change, and eradicating HIV.  

Sometimes this will mean investing programs and outreach and sometimes this will mean investing in infrastructure to run better businesses.



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