Tuesday, February 3, 2009

Building up the unpredictable charity ratings

By David Anttony

Charity ratings are a fickle thing with highly rated charities holding the number 1 position today being overtaken by new charities coming from nowhere. Charity Water is a recent and amazing example of this. Originality and the power of the Internet, are driving the ratings of brand new charities through the roof. A charity may not know today with a non-existent rating, but tomorrow it can be rated as number one by the New York Times as being the most amazing charity ever, and wham their rating goes from zero right to the top overnight.

Because the general public are swayed so much by the charity ratings the press and media give, a brand new charity can flourish very quickly with a flood of charitable giving being thrown its way. And of course when the media lose interest, then the charity rating can drop out of the sky overnight.

Directory listings of charity rating

With steadily rising distrust and morality guardians of charity being ever suspicious of charity problems like transgression, having pretty large amounts of money spent on the running of charities or mishandling of funds, listings of charity ratings are booming. It is real quaint that humanitarian institutions that are meant for giving others are under the watchful eye of charity watchdogs. The whole idea of benevolence is getting a bit problematical!

Organisations like Givespot.com and Guidestar.org list detailed charity ratings. Givespot.com has a detailed list called the GiveSpot 100 list, which shows its top 100 rated charities. Other organisations like charitynavigator.org have charity check systems as well as a charity Top Ten list so that look up a charity is easy. Guidestar.org is probably the biggest US charity directory offering an amazing array of charity information some free some at a cost. The Better Business Bureau in the USA, despite its name is also charity directory that lists both business and non-profit organisations.

With enough charity rating guides, there is no data shortage for anyone who wants to get information on the 100 top charities, but what constitutes real rating is something different. What in reality makes a charity superior has nothing much to do with its ratings. There are characteristics that make an organization, whether charity based or otherwise, stand out from the rest.

Charity Ratings and belief in the public

According to a YouGov poll of 2005, even well known charities like Save the Children and Oxfam did not enjoy a high amount of faith by the majority of the British population amounting to 56%. The public seemed to have faith only in about 15% of the charities even among those that had good charity ratings.

Charity Warning Bells are more common

Belief in charities is at an all time low these days. Public can hardly be blamed for this. Charity watchdogs are ringing warning bells of charity institutions spending even up to 60% of the amount collected on overheads that include big salaries for managers so that very little remains for real charity giving.

Recent studies show that the average costs of raising funds in the UK and Australia are 18% or 22% respectively. In the USA, the Association of Fundraising Professionals found the statistic to be around 30%. These figures do not even include admin expenses, which are often much higher. Some charity givers see this as a key issue especially with charitable giving often in the media spotlight like it was in Singapore a fewyears ago. The additional negative focus tends to reduce charitable giving which is not good.

Charity ratings secret exposed

There is practically no difference between a charity and a commercial enterprise when it comes to the question of drawing money. They way they put the money to use might be different, but the techniques they use to get that money are more or less the same.

In order to get the funds necessary for functioning, as well as to improve the charity ratings, there is only one assured way - make it tempting.

When we look at something and consider buying it, investing in it or connecting with it, we make an instant decision based on how attractive it is to us. If the level of attraction is high, we are highly interested and take action quickly and of course if low, we take our time or decide no.

Charity Water made it to the top of the chart in charity rating and got media support because of its unique and attractive image. The way they sold a bottle of charity water for the best price and projected the idea of using the profit for making clean water accessible to those who required it was very enticing.

The factors that combine to make Charity Water so enticing, making it popular, are easily decipherable.

* They have the perfect name - Charity Water that makes people easily respond to the obvious passion of the founder to the idea, and his eagerness to share it with others.

* Their idea of the vocation and their message is lucid, plain and remarkable - sell water and give water - Buy One Give One

* They focused on the solution and not the problem. This is the number one mistake that loses charities rating points lowering their charity rating in people's minds. No one wants to feel guilty and sad. They want to feel uplifted and happy. In this case happy to know they could make a difference in the lives of others by buying a simple bottle of water.

How to instantly reduce one's Charity Ratings

The fastest way in which a charity's ratings would go down is when it turns itself less tempting by centring its attention on the problem. People are by and large disinclined to listen to negative things. On the contrary, most people are keen on listening to positive things that involve verve, dynamism, motivation and effort to bring in a fresh vision.

To prove this, all we have to do is look at ourselves in the company of our kids and know how our response is positive when children make a request in an exuberant, polite and eager manner. The same request, if made in an irritating or maudlin way, might elicit a negative response.

The picture a charity projects would strongly affect its ratings. By projecting an arousing and motivating picture of itself it will be able to influence people well. Then people will be ready to give more in response.

Social Enterprise raises Charity Ratings and reduces Fundraising Problems

Social Enterprise is a new business paradigm that arose some time ago. This endeavour combines in it a commercial enterprise and charity. This has been initiated by those who are enthusiastic of solving social problems but are not satisfied with the pattern of charity organizations.

Many social entrepreneurs would never survive in traditional business because their ethical and moral values would always be in conflict with many of the business decisions made. Social Enterprise is a perfect arena for these very inspiring and valuable individuals who choose to use the business vehicle to effect social and global change. One of the most famous Social Entrepreneurs of course is Muhammad Yunus who was the first businessperson ever to be awarded the Nobel Peace prize in 2006.

A new global social enterprise, Buy1GIVE1 commonly known as B1G1 (Buy 1 Give 1), partners businesses with worthy cause and charity organisations right around the world. Buy1GIVE1 cuts traditional fundraising and administrative costs down to nothing: promising to give 100% of all funds received. Similar to successful online entities like Kiva.org , recently endorsed by Bill Clinton; Buy1GIVE1 is an alternative to the traditional way of direct giving to charities. Many find them a more efficient way to make contributions while gaining significant value in return.

Business leaders who are looking for opportunities to give back in effective ways and give to worthy charitable causes, see the great value and well-defined key marketing advantages businesses like Buy1GIVE1 offer. Each sales transaction makes a difference - and not just in an altruistic sense. With powerful 'impact-matching', businesses are gifted with an eye-opening, attention-grabbing marketing story. Compare the business that gives away a million dollars to charity with the one that lets their customers experience the joy of giving with Buy1Give1 transaction-based giving.

Businesses like Buy1GIVE1 profile charities and it tends to be the charities or worthy causes as they call them, that are the most attractive that receive the most contributions. Intrinsically business owners understand the power of attraction and they tend to go with non-profit causes that have the best story rather than look at their direct rating. They intrinsically know that their customers will connect with a better story and not ever think about a charities rating.

The Australian company Maple Muesli collaborates with an Indian charity called Midday Meals in the city of Mumbai. Whenever someone buys a bag of muesli, the contribution from it feeds a needy child there. A meal for a child costs only the equivalent of 30 US cents and the charity in this way feeds 125,000 kids in Mumbai every day. This makes the children desist from begging, keeps them away from streets, and makes them remain in school.

The company has managed to advertise the worthy cause of the charity Midday Meals in Australia. The inspiring story is continuously shared by Maple Muesli with all their buyers which has resulted in increased rating for the institution of Midday Meals in Mumbai, though all that the charity does is provide a daily lunch for those needy children. This is the era of Effective Giving - The sun has almost set on the Era of Plain Charity Donations.

We will surely see a change in the landscape of the top 100 charities over the coming years as new and innovative and far more effective ways of giving are created. These days we are spoilt for choice on how we can make our charitable giving. Not all of them are efficient ways to make a difference.

Other choices in Charity Ratings

Methods of charity have changed over the years and newer ways are making their presence, some of which are rated below. Comparison Points of Charity.

We have compared and rated a few well-known and less well-known charities and Social Enterprises on areas that are important to their donors.

THE SALVATION ARMY

PATH TO GIVING : DIRECT GIVING

One of the Top 100 charities in the world - The Salvation Army is a charity that individuals and businesses often donate to directly.

TRANSPARENCY - B - Lack of transparency - Sum of money is contributed - but result is not fully measurable.

BENEFIT FOR THE BUSINESS - C - Contribution to Salvation Army gets mention in the press even if it is a one time contribution.

FUNDRAISING COSTS - B - Spends millions of dollars annually to raise funds.

DONORS' CHOICE POTENTIALS -B- For those who want to give directly, there are plenty of charities to choose from.

POTENTIAL FOR REAL GLOBAL CHANGE - C- Nothing new to offer in terms of market change.

PRODUCT (RED)

ROUTE TO GIVING: MARKETING CAMPAIGN

Product (RED) is a brand that enters into partnership with companies, which then creates products with its logo, a percentage of which goes to fighting AIDS, TB and Malaria in Africa.

CANDOUR - B - Insufficient candour - Lots of money is donated - but result is not completely quantifiable.

MARKETING VALUE TO BUSINESS - A - People and businesses love to support (RED) as it is backed by adored personalities like Oprah & Bono. Marketing results a little hard to track though.

FUNDRAISING COSTS - C - Spends hundreds of millions of dollars on advertising - could have just given that money to Africa.

DONOR'S CHOICE OF CHARITY - C - Limited choice for collaborators on deciding to which charity they should donate - all their charity work is in Africa.

ABILITY FOR EFFECTING A CHANGE - B - All those who collaborate with Products (RED) are big enterprises and all the income is spent on Africa.

THE BODY SHOP

ROUTE TO GIVING: BUSINESS TRADE & GIVING

The Body Shop has a purchasing program known as community trade to help Third World countries; and from the income they generate, substantial contributions are made to charities.

CANDOUR - B - Insufficient candour - Lots of money is donated - but result is not completely quantifiable.

BENEFIT FOR THE BUSINESS - A-tve - Customers are interested in community trade and it increases their interest to do business with the venture. Visibility is not entirely sufficient.

FUNDRAISING COSTS - A - Lower costs - Successful business model that makes donations and boosts community trade.

DONORS' CHOICE POTENTIALS - A - Ventures that donate has the option to decide in what way their donations are to be used.

ABILITY FOR EFFECTING A CHANGE - B - The ability of the business to give back to the society is good - still few make the required additional effort to press on for change.

LIVE EARTH

WAY TO GIVING: EVENT FUNDRAISING

Live Earth was a series of worldwide concerts held on 7 July 2007 that initiated a three-year campaign to combat climate change.

CANDOUR - F - As per the reports of the site Intelligent Giving, satisfactory accounts were not produced on the proceeds from the sales of tickets.

ADVANTAGE TO BUSINESS - B - The sponsors of the business benefitted by the good press coverage, though by being a single occurrence results were not properly assessable.

COSTS OF FUNDRAISING - C - Huge amounts were spent on advertising and according to some the whole event was a damp squib without any actual goals.

DONOR'S CHOICE OF CHARITY - C - Only three charities could manage to get funds.

PROMISE FOR GLOBAL CHANGE - C - Such events can be held just once or at the most once a year. The amount collected generally goes to better known charities.

Buy1GIVE1 (B1G1)

PATH TO GIVING : SOCIAL ENTERPRISE

B1G1 is a brand licensed to form a partnership with any business - connecting them with any worthy cause in any place. A truly universal precept.

TRANSPARENCY - A - One for one giving ensures funds given are used for what they were intended. Customers know their giving translates into real change (e.g. numbers of trees planted, numbers of children fed).

MARKETING VALUE TO BUSINESS - A+tve - Great marketing value because of:

* Measurable giving * Media attraction * Good stories * Word of mouth * Repeat customers

FUNDRAISING COSTS - A+tve - Zero costs - B1G1 can take care of a charity's fundraising needs including a large percentage of admin as well. 100% of funds received go to the charity.

CONTRIBUTORS'CHOICE OF CHARITY - A - Business givers can choose their charity project or elect to give to a charity cause such as food or education, etc.

ABILITY FOR AFFECTING A CHANGE - A - Infinite. If increasing number of businesses can team up with charities worldwide, the possibility for real change is boundless.

You Might Think Giving away Money Would Be simple!"

Donating money may not seem to be a difficult job - it is just a question of handing over some money as cheque, cash or via the credit card. Still, someone like George Sores, who is as generous a donor as could be, agrees that effectual giving is no cakewalk. Underprivileged communities and countries receive millions of dollars in aid and still the situation remains much the same year after year.

People asking smarter questions will bring about the needed change. Social Entrepreneurs like Mohamed Yunis, Nobel Prize winner, creating innovative solutions to poverty and environmental issues with Micro Finance are carving the way to a new future where business initiatives, social enterprise and conscious consumerism transform our world. Initiatives like The Body Shop's 'Trade - Not Aid' need to be replicated. New ideas like Buy1GIVE1 need to be embraced. The value of social enterprise needs to be recognised.

When questioned on how one can bring about some positive global change, Bill Gates showed Kiva.org and Buy1GIVE1 (www.b1g1.com) as examples of charities that enrich the giver. Those who sponsor a business are updated by Kiva.org about the activities of the business. Buy1GIVE1 also does this. By this arrangement enterprises get enough stories to tell their clients - if they buy a laptop they will know that it will help in some needy person somewhere else getting a computer.

Other methods for improving your Charity Ratings

Make sure that you have an open attitude, use the laptop effectively, and keep apart a little time to observe the novel and wonderful systems of charity that are being born. These function through the internet and are mostly network based.

As of now if one is not connected with good international networks via the internet, the chances of losing out are substantial even with good charity rating, tomorrow things are bound to change - totally.

There are more and more examples these days of companies rising up from nothing and being sold three years later for over a billion dollars. This was unheard of ten years ago. Today this is becoming a regular occurrence. All these new Internet companies are doing one thing - tapping into global networks or creating global networks.

Buy1GIVE1 (Buy One Give One)

Buy1GIVE1 is a rather new entrant to the world of Social Enterprises and was launched in 1997 by a Japanese lady called Masami Sato. Any business can avail a membership in Buy1GIVE1, and membership charges for smaller ventures will only be one dollar a day and donations can be as little as one cent on a sale. Buy1GIVE1 is in the forefront of the Buy One Give One transaction-based giving world movement. Joining hands with Buy1GIVE1 is totally uncomplicated for businesses as well as charity needs. The working pattern of Buy1GIVE1 is perfectly controlled and practical. It connects the products or services of any given business to a needy cause (Buy1GIVE1's or their own) and after that whenever a sale is closed, it has to be recorded and the contribution percentage sent to the charity at the end of the month or end of quarter year directly or through Buy1GIVE1.

You could be losing out a lot if you are not interested in forming an association with Buy1GIVE1and not persuading your business patrons to do so. Buy1GIVE1 is a unique and brilliant organisation whose impetus as well as global impact is huge.

The dawn of a new age in charity giving

Institutions that no one had heard about even a few months ago, are today bombarding the cyber world with booming user acceptance. People strongly prefer have a place on sites like Facebook, MySpace, Twitter, YouTube, NING or TipJoy. One should also create strong bonds with companies like Buy1GIVE1, Kiva or The Present. These are the realities of the future which are imperative for sustaining and building charity ratings. Now is the chance to fashion an ideal new future.

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