Nonprofit News: “The Worst Question to Ask About Charity”

June 22nd, 2009 - Posted by OneStar Foundation

In his blog post “The Worst Question to Ask About Charity,”  Dan Pallotta writes about the misconceptions behind measuring a nonprofit’s success through low overhead costs. He argues that judging a nonprofit simply on whether or not it has low administrative costs does not answer the larger, more important question: how much social impact is generated by the work of that organization? The public assumes that there is a direct correlation between low overhead costs and high social impact, says Pallotta, but the two can be mutually exclusive. He doesn’t want people to assume that organizations with miniscule administrative costs must, therefore, be making a difference. In fact, Pallotta states that “major studies on the relationship between organizational strength and impact find otherwise.”

What questions do you think donors and volunteers should ask nonprofit to determine whether or not they are successful? How does your organization measure its success?  Join the discussion at Pallotta’s blog, or share your comments below.

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