Posted on 11th May 2010
A new report says that charities need to measure what they do to attract funding in an increasingly competitive world where resources are likely to continue shrinking. But funders must recognise that monitoring outcomes costs money and they should invest in helping their grantees to measure impact.
Published last month, the report from the Private Equity Foundation (PEF), a venture philanthropy fund which invests in charities working with young people, says that, ‘A new generation of sophisticated donors, grant-funders and statutory service commissioners is seeking clear data on results as a basis for decision-making, and organisations that are unable to provide this will be at a disadvantage.’
One of the report’s authors, Aliyyah Giga, told Philanthropy UK, “Measuring outcomes has always been important but increased competition for funds has made it even more so. But funders have a responsibility to help service providers with measuring.
“It’s vital to involve frontline workers in the design and implementation of measuring systems," continues Aliyyah. “Otherwise, there is a risk they view the exercise as more bureaucracy which keeps them away from their central mission – serving clients.
“You need to be able to show that measuring impacts can help to refine and improve the services they offer and ultimately benefit their clients.”
Harvey Koh, the report’s co-author and head of investment and performance at PEF told Philanthropy UK ,
“We love to count things in the private equity world but obviously the charity world is different – you don’t have a bottom line to measure. We have to recognise the tension between the desire of funders to measure the impact their investments are bringing and the need of charities to measure their success against their own missions - sometimes the two are perfectly aligned but not always.
“We need to move away from the attitude that some funders have which is, 'here is our money, so just give us the information we want'. Funders need to work more closely with charities and they need to realise that if you want effective and accurate reporting, it has to be paid for.”
The report can be downloaded free from the PEF website.
Aliyyah Giga was working at PEF on an externship from global management consultancy, Bain & Co.
