The received wisdom about measuring impact (much simplified, of course) is that it serves two purposes: it enables non-profits to know how they’re doing in terms of achieving their goals and to adjust accordingly, and it enables donors to make rational decisions about which NGOs to support, thus channelling resources to the most effective organizations.
So do potential donors want to study in-depth reports to help them make decisions? And to receive such reports on an ongoing basis from organizations they’re supporting? Not necessarily, is the conclusion one would draw from an interesting panel discussion on ‘Demonstrating Impact’ at the European Association for Philanthropy and Giving’s annual conference in London on 24 November.
What are wealthy donors expecting in terms of reporting and evaluation from the charities they support? Are they prepared to pay for effective monitoring and reporting? These were some of the questions for the panel. The message that emerged was that donors do want to know they’re making a difference but they don’t necessarily want in-depth reports on impact.
Not surprising, perhaps, given that wealthy donors are likely to vary as much as any other group of people! Tris Lumley of New Philanthropy Capital (NPC) told of a charity that produces regular in-depth impact analysis but never gives reports to donors – because no donor has ever asked for them. In his view, not all ‘new philanthropists’ want in-depth analysis. They want to hear they’re making a difference but they don’t want to have to become analysts themselves. Caroline Underwood of Save the Children stressed the importance of showing leverage.
In her experience, donors of over say £25,000 do need tailored reports on what they’re funding but they will want different things. Taking the example of a new reservoir in a very poor community in Ethiopia (in fact costing only $6,000), some donors will want to know how many people use it and what difference it makes to their lives, and some may prefer a DVD showing women using it, or personal stories.
Another thing that all panellists agreed on is that wealthy donors are not prepared to pay separately for impact measurement. Tris Lumley’s conclusion from this was that we need to invest in organizations’ ability to measure their impact and end our obsession with low administration costs.
None of this undermines the need to measure impact (how you think about impact in relation to funding advocacy campaigns or small grants programmes or social movements is another story). But maybe the emphasis should be more on organizations’ own effectiveness rather than on what donors are assumed to want.
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