The little blue book: NPC's guide to analysing charities, for charities and funders

Brits and Yanks have cross-exported many things for which we owe each other, alternatively at times, profound thanks and abject apologies. But America will forever be in the UK’s debt for one singular contribution to advancing the charitable arts and sciences. I speak, of course, of New Philanthropy Capital’s recently published master work, The Little Blue Book: NPC’s guide to analysing charities, for charities and funders.

True, the LBB is not the OED, but I’m less sheepish than perhaps I should be in thinking of it as philanthropy’s Magna Carta. The LBB won’t be the last word on charity analysis, but its earliest version was among the very first and its latest may well be the best. What distinguishes the LBB from an over-crowded field is its rigour, scope and utility. I can’t imagine any useful methodology for evaluating charities that wouldn’t emulate at least 80% of NPC’s approach. And NPC started from a nearly clean sheet of paper.

NPC’s work has been formative in my own efforts to understand the $300bn (£197m) American non-profit capital market, and I’ve had the pleasure of knowing some of NPC’s brilliant team since 2006 and even visiting its laboratory at London Bridge.

The LBB tackles the most daunting challenges with grace; “Assessing effectiveness is a complex business”. It offers and supports the simplest and most profound truths; “Charities with very different goals cannot be directly compared with each other”. It takes one’s hand and leads the way, step by careful step, along its enlightened six-part framework – activities, results, leadership, people and resources, finances, and ambition – eschewing facile notions that one-size-fits-all. And it does so in concise and highly readable prose.

To be sure, there is one enormous drawback to NPC’s rating system: its business model. NPC employs a sizeable and talented staff of analysts who conduct exceedingly thorough due diligence, including site visits and interviews. It is time-consuming and expensive, and its financial sustainability, particularly in substantially larger US and international charity sectors, is unclear at best.

Still, the LBB is a wheel that we shouldn’t spend a lot of time and money reinventing. Rather, all of us who care about improving people’s lives through charitable giving, working and volunteering should devote ourselves to promoting its widest possible adaptation within a more robust delivery vehicle. It’s available on NPC’s site as a free download and a £10 booklet. I’m doing both.