Conference Roundup: Rating Charities

The ratings are unfair, Melia said, because the groups don’t factor in outcome measurements — how many people organizations help. Melia further explained that the watchdog groups use no official government standard for rating charities and no uniform criteria.

They do base the rating on fundraising efficiency (how much it costs to raise a dollar), cost allocation (expenses allocated to program administration/fundraising), capacity (how much money they have in reserves), and governance (board independence and oversight).