Seeing the Big Picture on Charities

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The charity's focus may be on solving an unpopular cause or a rare disease. It may have just launched a capital campaign. Or its offices may be in a high-rent city.

Comparisons derived solely from financial data may be misleading and unfair to a charity's reputation. On the other hand, misleading comparisons may improperly boost the reputation of an undeserving charity. It's essential for all of us to recognize that "rating" charities is a confusing endeavor -- even for experts. An assessment of the charity-watchdog organizations, "Rating the Raters," done by the National Council of Nonprofit Associations and the National Human Services Assembly, is helpful in deciphering the differences among the various ratings organizations. This report can be found on the Internet at nassembly.org.

EASE OF INFORMATION.

In the end, we all want easy answers to hard questions. We simply want to know if a charity is "good" and deserving of our hard-earned dollars, or if we should donate somewhere else.

We can find that out in part by using the data at our disposal. Certainly a positive outcome of the overall data deluge we're experiencing is that donors are much better informed. They can readily tap into excellent "wise-giving" information on the Internet. I think there may possibly be less wrongdoing among charities today than in the past simply because of the availability of information.

Be grateful that it's available. We should also take comfort in the fact that board members are under mounting pressure to be responsible fiduciaries, and that charity employees are protected by whistle-blowing statutes. But in the end, you have to take into account the reasons you have always given:

• Your emotional tug: You simply feel strongly about the cause.

• You consider it morally important to give.

• You volunteer or have experience with the organization.

• Your family or friends have asked you to contribute, and you want to be responsive.

• You simply want a tax benefit.

BOTTOM LINE.

There can be other reasons, of course. But we all give in spite of knowing that there will always be human mistakes and transgressions in the nonprofit world -- just as in every other aspect of society. We also know enough to ask questions and do research. We appreciate that the sector is under a microscope, and hope that will ensure there are fewer opportunities for future scandals.

Continue to rely on your own instincts. If your inner voice tells you something sounds phony about a cause, then investigate further, or simply walk away. And never lose sight of the fact that what it's really about is each one of us doing some good, reaching out to those in need, and improving our society whenever we can.

Cristine Cronin is president of NYCharities.org, a free Web site dedicated to helping people donate whatever they can -- time, money, or talent -- to New York State's 60,000 charities. She is a contributing columnist to BusinessWeek.com.