We can feel warm and fuzzy about an organization’s mission, but how do we know that they’re doing well AND doing good?
“Accountability” is not just a demand for corporations on Wall Street. For the last 20 years, nonprofits have been under pressure from funders, clients and the community to prove that they’re actually making a difference. Today the Tacoma-based international water nonprofit A Childs Right has lit up the Tweetosphere about their new “radically transparent” accountability project, #ProvingIt.
Is it new? Is it radical? You decide.
We’ve seen performance measurement projects come and go in the nonprofit sector, and there’s something to learn from all of them. Yes, financial ratios are important: What does an organization spend on programs vs. fundraising and other administrative costs? But sometimes the bottom line doesn’t tell the whole story. How has the world changed for clients? The community? Is it worth the cost?
Measuring against peers and common indicators provides benchmarking within fields of work, and measuring against mission lets us see if an organization is accomplishing what it set out to do. Balanced scorecards and other dashboards help stakeholders understand complex systems. Social return on investment became a popular accountability approach in the late 1990s. That’s morphed into “blended value,” a nonprofit take on the triple-bottom line of economic, social and environmental returns. Some think this approach helps measure socially-responsible business and mission-driven nonprofits on equal ground.
These approaches work for individual organizations, and even communities. I helped develop community indicators projects for several years, contributing to the development of www.WhatcomCounts.org, and assisting the City of Bellingham in setting 50- and 20-year goals based on community priorities. Groups such as the Jacksonville Community Council have done an amazing job at gathering citizen and organizations’ priorities and tracking progress on poverty, race and other issues. Not only do they measure and report, they also actively use their findings to help organizations adapt, and to pressure public officials to change policy. This is the real power of setting goals, measuring impact, and reporting results.
While accountability is being done well in many communities and organizations, there’s still a long way to go. Several of my nonprofit management students struggled to get basic information from organizations they studied. Especially when facing challenges, nonprofits tend to batten down the hatches: closing board meetings to the public, limiting communications, and not providing basic financial information upon request are sketchy tactics at the least and illegal at the worst. Often such missteps are due to internal crisis, embarrassment about how things are going, or lack of knowledge about ethical and legal standards. Other times, it’s a red flag for nefarious activity.
So what’s the new approach that A Child’s Right is taking?
It really is radical: They are laying their successes and failures bare. At their website, donors, the public, ANYONE can check in on the status of all of their water projects around the world. You don’t have wait for an annual report to see that over 200,000 kids are getting clean drinking water. What’s really radical? A Child’s Right promises to show you their performance even when the numbers go down. It’s not an entirely new approach to measurement, but rather a new commitment to transparency in reporting.
Via email, Peter Drury, the organization’s development director, said, “A Child’s Right designed this database for internal purposes – for project management and quality assurance – but mid-stream in development we made the radical choice to make it 100% open to the public. This means that when a system fails, the donor learns at the same time that the executive director does. A Child’s Right is committed to radical transparency, including earnest conversations about failure and course-correction.”
As a planning and evaluation geek, I like what I see at first glance. Will this approach be a game-changer in the field of water development? Funders and partners may begin to expect similar transparency from other organizations. The approach may even impact the larger nonprofit sector as a whole. What would it look like if every organization were so open with success and failure?
Especially in a world where socially-innovative businesses are competing with nonprofits for shrinking resources, I wonder if such openness could ever work against an organization’s strategic interests. Real-time reporting is great, but does it hinder thoughtful analysis and planning for change? I’m wearing my cheerful skeptical face, hoping this commitment to transparency is more than just good PR. Yes, setting goals, measuring results and reporting impact is important. But can a web-based reporting tool really change the world for kids or communities? I’m eager for A Child’s Right to prove it.
Ultimately nonprofits’ responsibility is to the community. We’re using community resources to change the world, and the community deserves to know if we’re having the impact we promised. Congratulations to A Child’s Right for making this commitment, and making it a radical commitment. Follow their progress at http://achildsright.org/provingit/, or follow the #ProvingIt hashtag on Twitter and their main handle @achildsright.
Personally, I can’t wait to see what they learn and share about the experience. In particular, I wonder how such radical transparency may someday influence the community indicators movement: Will the often-overlapping and sometimes-competing interests of governments, businesses and nonprofits be served by radical transparency? Meanwhile, what can the rest us do to increase the accountability of our organizations? Are we setting goals and measuring progress? If so, how are we reporting the results, and how are we changing organizations, public policy and communities in response to what we learn?