Welcome to Charity Navigator's Blog!

The team from Charity Navigator, the nation's largest independent charity evaluator and leading donor advocate, shares their thoughts on emerging nonprofit-sector issues and offers tips to better inform your intelligent giving decisions.

Monday, August 31, 2009

NJ Area Nonprofits: Don't Miss The 2ND Annual Nonprofit Symposium

Where: Bergen Community College, Nonprofit Institute for Philanthropy and Leadership
When: September 23, 2009, 8 a.m.
Items on the Agenda:
  • Panel Discussion: “Surviving Tough Economic Times – Staying Focused on Your Mission”
    Among the panelists is Charity Navigator's very own Ken Berger!

  • Various Sessions: Web 2.0 and Social Media – Finding the Diamonds in the Rough, Performance Management and Outcomes Measurement, Meeting Your Needs and Theirs – Managing Volunteers in the Current Market, Brain Drain – Preparing Your Organization for Middle Management and Executive Leadership Succession, Financial Keys to Mergers and Alliances, An Overview of the Small Nonprofit, Careers in the Nonprofit Sector, Fundraising in Changing Times, Successful Branding and Marketing of a Nonprofit

  • Keynote Speaker: Steve Adubato, Ph.D, Anchor, Thirteen/WNET (PBS) and Author, “What Were They Thinking?”
To register, please contact Ilene Kleinman at (201) 447-7160 or e-mail ikleinman@bergen.edu.

Friday, August 28, 2009

4th anniversary of Hurricane Katrina

On August 29, 2005, Hurricane Katrina devastated the gulf coast. The horrific stories, photos and videos inspired philanthropists to give $6.5 billion towards the relief and recovery efforts. The pace and level of giving was unprecedented, breaking all previous records of disaster-related giving. Charity Navigator played a part in guiding some of that giving by highlighting ratings for charities responding to the crisis, by providing tips to donors and by sharing our data and expertise with the media.

Tomorrow marks the 4th anniversary of Hurricane Katrina and we can expect the media to revisit the disaster. This may in turn prompt many donors to reflect on charitable investments made in the wake of Katrina. We offer the following resources for those who want to give again, follow-up on their previous gifts or simply learn more about what went right and what went wrong after Katrina.

Thursday, August 27, 2009

Corporate Giving Trend Continues

Tom’s of Maine is offering five $20,000 donations to support community projects in a contest called 50 States for Good This competition is the latest in a growing trend of for profit companies allowing their clientele to determine where their philanthropic dollars go. Target recently allowed its Facebook fans to direct a $3,000,000 contribution by holding an on-line vote in May.
Pairing philanthropic work with customer involvement is a natural move for many companies, who typically give back a portion of their earnings to the community. By drawing new visitors to their site with an interactive experience such as voting, they engage their patrons while supporting a good cause. The Tom’s of Maine contest has drawn applications from organizations in nearly every state. The submission period closes August 30th for nonprofits to register their projects and voting begins September 21st by Tom’s. Find out more on the Tom’s of Maine website.

Wednesday, August 26, 2009

Senator Edward "Ted" Kennedy 1932- 2009

If you've read a paper or watched the news, then you no doubt know that Senator Kennedy died of brain cancer yesterday at the age of 77. You probably also know that his sister, Eunice Kennedy Shriver, who founded Special Olympics, died earlier this month. For those that wish to make a donation in remembrance of the Senator, we suggest the following charities.

Education Charities in Massachusetts:
Harvard University
Citizen Schools
Hands Together
Reach out and Read

Health Charities in Massachusetts:
Partners in Health
The Medical Foundation

Civil Rights Organizations:
Center for Constitutional Rights
Common Cause Education Fund
American Civil Liberties Union Foundation

Brain Tumor Charities:
Brain Tumor Society
National Brain Tumor Foundation
American Brain Tumor Association
Pediatric Brain Tumor Foundation

Be Careful Of Sound-Alike Names

Charity Navigator's senior program analyst, Matt Viola, and Detroit News columnist, Neal Rubin, remind donors to be careful of charities with sound-alike names. In this particular case, the National Children's Leukemia Foundation (NCLF) is capitalizing off the Children's Leukemia Foundation of Michigan's brand name to entice well-meaning donors to support its inefficient efforts.

Most recently, the National Children's Leukemia Foundation reports spending 58.5% of its budget on programs and services. But previous financial reports show it spent as little as 10.2%! Either way, this charity is less efficient that the typical charity rated by Charity Navigator which spends at least 75% of its budget on its charitable mission. Furthermore, comments left by visitors to our site show that potential donors are annoyed by the NCLF's telemarketing efforts.

Be sure to check out Charity Navigator's Top 10 Best Practices of Savvy Donors for more tips on how to be an informed donor.  

Tuesday, August 25, 2009

Charity Navigator’s Funding

Just like the charities we evaluate, Charity Navigator is a 501 (c)(3) tax-exempt charitable organization under the Internal Revenue code. We are currently in the second year of a 5-year interim ruling period, at the end of which (11/30/2012) we must demonstrate that we have fully transitioned from private foundation to public charity.

Why are we doing this? In simple terms, we want to expand our capacity to 1) evaluate more charities, 2) add new dimensions to our ratings system, and 3) hold ourselves to the same standards as public charities.

Perhaps the most important requirement we will have to meet is the IRS’s “public support test”; in terms of numbers, that means that we will have to derive a minimum of 1/3 of our revenue from a diverse funding base (individuals, foundations and corporations). Currently, approximately 15% of Charity Navigator’s funding comes from those sources, with the remainder generously given to us by our founders (click here to access background and financial information). Since our founding, over 6,200 donors have made contributions in support of our work and we are deeply grateful.

We have a lot of work to do and we’ll need a lot of help in the next few years to ensure that we successfully make the transition. Some of our users have noted that we are now allowing advertising on our website. Advertising is another way to diversify our funding stream, just as many charities sell merchandise or engage in other activities that might be considered of a commercial nature. The dollars derived from it aren’t huge, only about 1% of our budget, and we feel we must pursue every viable funding avenue as long as it does not violate our mission or jeopardize our tax-exempt status. To that end, Charity Navigator accepts no advertising or donations from any of the charities we evaluate.

We value your feedback. If you have questions, concerns or comments about our funding, please do not hesitate to contact us at development@charitynavigator.org. And if you'd like to support us, you can find out how here.

Monday, August 24, 2009

Summer Reading

The Ultimate Dream, a new book written by Heather Chabino and Sherri Watson, was inspired by The Ultimate Gift by Jim Stovall. In The Ultimate Dream, a mom (Ms. Chabino) sends her daughter (Kenzie) on a life-changing journey to learn that gift-giving encompasses more than doling out material good. This book enjoys endorsements by Steve Forbes, Tony Romo and Charity Navigator's very own Ken Berger.

You can view a TV interview with the Ms. Chabino and her daughter here.

Friday, August 21, 2009

Ramadan and the Tradition of Zakat

Ramadan, a holy time when Muslims fast and focus their attention on giving to charity, starts this weekend. Zakat is a integral part of Ramadan and one of the five pillars of Islam. Specifically, zakat requires Muslims to give at least 2.5% of their assets to the poor and hungry.

But American Muslims have found it difficult to meet this requirement in recent years. After the terrorist attacks of 9/11, the US government increased its scrutiny of Islamic charities accusing some of providing support to terrorists. This dampened zakat as many American Muslims feared that their generosity may inadvertently support terrorist activities.

President Obama hopes to change that. In a speech he gave in June in Cairo he said, "rules on charitable giving have made it harder for Muslims to fulfill their religious obligation. That's why I'm committed to working with American Muslims to ensure that they can fulfill zakat."

To help Muslims practice informed giving during Ramadan, Charity Navigator published a listing of highly rated charities which either work in countries with large Muslim populations or strive towards the alleviation of hunger.

Thursday, August 20, 2009

Boomer Market Advisor Features Charity Navigator Giving Tips

The August issue of Boomer Market Advisor includes an article on charitable giving tips for financial planners helping donors prepare their future gifts. Boomer Market Advisor is a magazine which offers information and studies for financial planners serving baby-boomer generation clients. The tips, which cover everything from the tax benefits of donating to choosing an organization, were written in collaboration with Charity Navigator. You can read the full article here. For more information, you can review our expanded article on maximizing your philanthropic impact here, and top tax benefits of giving here.

Wednesday, August 19, 2009

More on the Charitable Impact of "Cash for Clunkers"

USA Today personal finance writer Sandra Block suggests that "sometimes a charity is better choice" than the government's "Cash for Clunkers" program. Her article includes a quote from Charity Navigator's president & CEO, Ken Berger. This is a topic that we've covered previously on this blog.

Tuesday, August 18, 2009

More Stringent Review of Military Charities

Good news for donors who wish to support the troops. The Office of Community Relations recently developed a more stringent vetting process for groups to be listed as a resource in the “Support for Our Troops” section of OurMilitary.mil. All groups listed on the site must provide documentation of their 501 (c) (3) status, complete an application and self certification form, and demonstrate that they have been vetted by at least two independent charity evaluators- such as Charity Navigator.

At Charity Navigator you'll find our own list of charities that support the troops.

Monday, August 17, 2009

Teaching Your Child About Giving

Education.com Partner Badge

Education.com has republished our article, Five Great Ways to Teach Your Child About Philanthropy. In it we offer several tips for helping your child become a philanthropist including donating used clothes, food and new toys. Other experts advocate that you start early teaching your child to share, spend and save their money.

Interestingly, we've received a lot of feedback from parents and grandparents explaining how our site has helped the kids in their lives identify charities to help. That process enables kids to not only beef up their math skills, but to also learn about the size and diversity of the nonprofit sector. The education component of what we do is also apparent in the fact that many schools link directly to Charity Navigator's database as part of a class assignment.

How about you? How do you teach your kids to give back? Do they enjoy donating money or used items? Or would they prefer to volunteer?

Friday, August 14, 2009

Big Charity Scandal May Lead to Big Reform

In the wake of a major charity scandal involving the Sephardic Jewish community, many community leaders and charitable givers are demanding reforms and transparency. A major donor to these organizations, the Jewish Funders Network, is asking organizations to "exceed the standards that the government is imposing specifically in the areas of transparency and governance.” Late last month, Federal agents arrested 44 people on corruption charges, including three leaders of the Sephardic community. Millions of dollars were laundered through religious charities. Also being considered as part of the reforms is the end to grants given to organizations who take a religious exemption allowing them to not have to file financial forms with the IRS. This issue is a reason why many religious organization, including the Salvation Army can not currently be evaluated by Charity Navigator.

Thursday, August 13, 2009

“Cash for Clunkers” has Mixed Impact on Charities

As previously reported on this blog, many charities expressed concern about the impact of the “Cash for Clunkers” program on charitable donations of automobiles. The program, which offers car buyers a rebate of up to $4,500 when they trade in their old car for a new one, has predictably resulted in a decrease in car donations to many charities. Other charities, however, feel that the program may have spurred increased donations of cars that don’t meet the governmental program’s requirements. While the true impact of the program remains to be seen, for now, the reaction is generally mixed.

If you are considering donating your car to charity, we suggest you read Charity Navigator’s
Guide To Donating Your Car for tips on this subject.

Tuesday, August 11, 2009

Eunice Kennedy Shriver 1921 - 2009

Special Olympics announced early this morning that its founder, Eunice Kennedy Shriver, passed away in Massachusetts, surrounded by her family. Special Olympics, founded by Shriver in 1968, provides people with intellectual disabilities continuing opportunities to realize their potential, develop physical fitness, demonstrate courage and experience joy and friendship.

Timothy Shriver, Eunice Kennedy Shriver’s son, and Chairman and CEO of Special Olympics stated on the organizations’ website: “My family and I would be proud and honored if you would take some time to learn more about her life, share your own remembrances about her, and read the remembrances of others at a website that was recently established to honor her legacy, www.eunicekennedyshriver.org. In the spirit of her hope that everyone would share in the power of Special Olympics, I hope you'll not only read and contribute to the site, but share it with friends.”

Charity Navigator evaluates the national Special Olympics, as well as many of the local chapters, which you can find by clicking here. If so inclined, donations can be made to the Special Olympics in honor of Eunice Kennedy Shriver via our site.

Food Bank Stimulus

The Nation's food banks have received $100 million in funds per the economic stimulus bill that was signed earlier this year. This is welcome news for food banks that have seen a rise in those coming to them for assistance. Some surveys have found that demand is up 30% from last year. As more and more Americans find themselves unemployed, the need for food assistance is increasing. For a list of Charity Navigator 4 star rated Food Banks that you may want to support go here.

Monday, August 10, 2009

2009 CEO Compensation Study Released

Our site users have the opportunity to post comments about their favorite – and least favorite – charities that are listed on the Charity Navigator website. Perhaps the most frequent comment we see relates to executive compensation. Individual donors are fed up with seeing outlandish salaries paid to the leaders of nonprofits around the country!

While ultimately it is up to the donor to decide what they feel is appropriate pay for staff at the organizations they are considering supporting, Charity Navigator recently released a study of the charities listed on the site investigating executive compensation in depth. Understanding some of the factors that influence CEO pay and learning about average pay across the charity world can help you make an informed decision as a donor. You can watch our short video to hear about the findings from CEO and President Ken Berger.

Friday, August 7, 2009

Positive Changes for the Red Cross

The American Red Cross is letting the public know it has made significant changes during the past year, and they seem to be paying off. While the deficit was at $209 million a year ago, it currently stands at $50 million, and the organization says that it aims to balance its budget next year.

In house cuts via eliminating positions; decreasing raises and benefits; and reducing overall expenses, combined with much higher than anticipated response to the organization’s fundraising goals are attributed to the positive change.

The Red Cross also states that it is embracing new tech savvy ways of raising funds, and is aiming to be prepared prior to any catastrophe: "Our goal is to not only raise money episodically during a disaster, but to ensure that we have the funds to respond before a disaster strikes," Gail McGovern, president and CEO of the American Red Cross since taking over last year, said.

Thursday, August 6, 2009

Time is Money

A new report by the Corporation for National and Community Service gives us cause to smile. Volunteerism rose by 2% in 2008, despite a faltering economy and reports of low monetary contributions to charities. Although it would be nice if we all had the means to increase our financial support to our favorite charities annually, it's important to remember just how valuable gifts of time truly are. In 2008, one hour of volunteer labor was worth an estimated $20.25. That can add up to a pretty respectable gift over time considering that the average annual household donation is somewhere around $2,000. So if you'd like to donate to your preferred charity but don't think you've got room in your budget, consider making a contribution of time instead. To get started, take a look at our Guide to Volunteering, check out charities that match your interests and contact them directly to see how you can help. Time is money!

Wednesday, August 5, 2009

Charity Execs Getting Big Salary Increases?

Here's the footage of Ken Berger on Fox Business News today talking about Charity Navigator's newly released CEO Compensation Study.

Charity Navigator's 2009 CEO Compensation Study

Today, Charity Navigator published its 5th annual CEO Compensation Study.

In examining the compensation practices at the 5,448 charities in our database, we found that the top leaders earned an average salary of $158,075. This represents a pay raise of 6.1% over the previous year studied.

Our 2009 study offers insight into how a charity’s mission, size, and location impact its CEO’s salary. The report also highlights some questionable salaries and suspect compensation policies. And we round out the report by offering advice for judging the appropriateness of a nonprofit executive’s pay.

The report is already generating media attention. In fact, our President & CEO, Ken Berger, will be discussing our findings on Fox Business News with Stuart Varney this afternoon at 1pm EST.

Tuesday, August 4, 2009

Charities Located In The Nation's Capital Have Limited Rainy Day Funds

As we've discussed previously on this blog, the charities that have the best chance of weathering the current economic storm are those that have 6 months to a year's worth of working capital (rainy day funds). That makes a new report, by the Urban Institute, showing that charities in the D.C. area have low reserves, very disconcerting. This particular study shows that more than half of the charities in the nation's capital have less than three months worth of working capital.

Our own analysis, from 2008, shows that D.C. charities have about the same amount of rainy day savings (about 8 months) as charities in other U.S. cities. In fact, we found that charities in Colorado Springs (about 3 months), Orlando (about 3 1/2 months) and Phoenix (about 5 1/2 months) were in a much more precarious position than those in D.C. On the flip side, the philanthropic marketplaces in St. Louis, Boston, and Pittsburgh all reported having at least a year's worth of working capital.

Monday, August 3, 2009

August Update

On August 1st, we issued more than 450 new ratings, including those for New York Cares (4-stars), The V Foundation (4-stars), The Mobility Project (0-stars), and Vision America (0-stars).

We also added
16 new charities to our site. These include Life for Relief and Development (4-stars), Polaris Project (4-stars), and Sacramento Loaves & Fishes (3-stars).

You can also check out the new Top 10 lists added to the site this month, as well as a few
articles that deal with the ongoing problems charities are facing in these tough economic times. Concerns about funding for nonprofits located in rural areas, as well as declining gifts to colleges are just a few of the issues plaguing charities in today's economy.

If you haven't done so already, be sure to
sign up for our free, monthly, email newsletter so that you can automatically be notified about our updates.