Last fall, I became a member of the Arbor Day Foundation. Yay, trees! I love trees. I want to save trees. The Arbor Day Foundation loves and plants trees. Sounds like a membership marriage made in heaven, right?
Almost immediately after becoming an annual member, like within a couple of months, I received a mailing from the Arbor Day Foundation asking me to renew my membership. What the what?
Excuse me, I just became a member and you’re already asking me to renew? Not cool.
A month or so ago, I got the following in the mail from the Arbor Day Foundation:
It is yet another membership renewal with, count ’em, around 11 pieces of paper and an envelope.
Tell me, how is this saving trees? This mailing is not only annoying because it is yet another membership renewal when I’m nowhere near my annual renewal time, it goes directly against the organization’s mission.
Nonprofit organizations, DON’T treat your members this way!! Or work against your mission through the mailings you send. Just don’t.
And, if you’re too close to the forest for the trees (metaphor very much intended), ask your members or some other third party what they think of your mailings.
Assessing the Performance of Nonprofits
Before I launched into this blog post, which I’ve had on my docket of blog post topics for a while now, my daughter texted with questions about how to best assess the performance of nonprofits in order to determine where to contribute money. Rather than simply grouse about the Arbor Day Foundation, I thought I’d share some of the advice I gave to my daughter.
Roll up your sleeves and get ready to do some research.
1) The first thing you should do if you want to get background information on nonprofits is sign up for a free account through Guidestar.
Guidestar provides the 3 most current IRS 990 forms on file for nonprofits that are required to file them. (Very small nonprofits, those with revenue under $50,000 per year, only have to file a 990 e-postcard, not the full 990. Churches aren’t required to file a 990 at all.)
The 990 shows the sources of an organization’s revenue and its expenses, along with the salaries of its board and staff if they meet a specific income threshold. It also contains a section for Program Service Accomplishments. This should explain how the organization is meeting its mission. Some organizations only fill out the bare minimum on this section, which is a waste of a good opportunity in this public document to describe all the wonderful work they are doing.
When you are investigating a nonprofit, take a hard look at their 990s. These are complex documents, so it may take a while to get accustomed to them. Ask a trusted friend who works in a nonprofit to explain them to you if needed.
2) Check to see if the organization is registered with the Secretary of State’s Office where it is based. You can typically do this with an online search. Not every state requires a nonprofit to register with the SOS. Nationwide organizations are required to be registered within every state that requires it when they are soliciting donations or memberships.
3) Along with the 990, you’ll want to look for the nonprofit’s website to find additional information, like mission statement, vision, board and staff, programming, annual reports, and the like. When examining the website, ask yourself, how transparent is this organization? Does it provide you with the information you are seeking or does the organization seem opaque? Is there an easy way to contact the org?
4) Check out the org’s social media presence. How transparent is it via these channels? Some small nonprofits may not have their own website, working mostly through a site like Facebook to reach their audiences. What is the tenor of the social media posts? Is the org open or defensive?
5) Search for news of the nonprofit on your favorite search engine to see what comes up. A nonprofit may be reluctant to discuss negative news on its website or social media, but a local news source may uncover problems or, heaven forbid, scandals within the organization. If you find negative news, check to see whether it is addressed by the nonprofit on its own channels. If it tackles the controversy head-on and takes responsibility for it, that’s a good sign. Nonprofits can be complicated to run, so problems may arise through no real fault of those running the organization. Watch for how the nonprofit responds to determine whether you want to support it. No nonprofit is perfect, so consider cutting them some slack if they have a rare, fairly minor issue. If they have continual problems, find a different org to support.
6) Word of mouth is important. Ask your friends, family, and work colleagues if they have experience with a nonprofit in order to glean more information before making a donation or becoming a member.
7) Contact the organization directly with any questions you might have and note the response, whether you give them a call or send an email. Does someone get back to you in a reasonable amount of time? (Be aware that very small organizations run by all volunteers or a small staff may not be able to respond right away.) Do they answer your questions directly? Are they pleasant?
8) If the organization allows for membership, become a member at the lowest appropriate level. This will give you an opportunity to see how the organization treats its members. You should get a decent standard of treatment even at the lowest levels of support. That means getting an acknowledgment of your membership, plus whatever items, mailings, etc. were promised with that membership level. By becoming a member, you will have a better chance of seeing whether the organization is meeting its mission. If you are a member of a local nonprofit, there will be an annual meeting you can attend. Watch for this and go in order to see how the meeting is conducted and visit with board members and staff.
If the nonprofit is not a member org, make a small donation and see how the org responds. Daughter just made a donation to a school and received a personalized video acknowledgment. Now that’s responsiveness! And it has her considering further donations.
If you have a bad experience as a low level member or donor (ahem, Arbor Day Foundation), you can end your relationship with the organization and search for a new one to support.
Supporting Smaller Nonprofits
While it may seem easiest to support large, long-established nonprofits with a good track record, your contributions may actually do the most good with smaller organizations. Large nonprofits (think nationwide) have well-established bases of support, whether through government funding, a direct line to foundations, endowments, major donors, or other revenue streams. They have a tendency to vacuum up most of the charitable giving dollars available while smaller organizations with missions that are just as critical are left in a perpetual starvation cycle. These smaller organizations know how to stretch a dollar. If they are within your community, they may also be the most approachable in terms of getting to know them personally. Consider not only becoming a member or making a donation, but becoming involved as a volunteer, committee or board member.
Regardless of size, do your due diligence in assessing nonprofit organizations before deciding where to contribute your money and/or time.
If you have other tips or resources for assessing the performance of nonprofits, please leave them in the comments.