Transparency in the Charity Sector
Transparency in the Charity Sector
Transparency is more than a buzzword. The truth is people won’t, and shouldn’t, donate their hard-earned cash unless there is trust that the money is being suitably spent. The vast majority of charities both believe and adhere to this principle, yet the reputation of the sector as a whole has come under scrutiny in the past few years, impacting donor confidence in the charity sector overall.
At Altruism Ireland our role is to act as an intermediary between people and charities, allowing people access to the type of information that facilitates trust – such as charity’s financial reports, including expenditures, in an easy-to-read manner, as well as services they provide and the results that they have achieved. For a more detailed breakdown of our transparency metrics, please see below.
On the other side, Altruism Ireland also allows for virtuous charities to engage people through transparency. By making their details freely available, charities are showing that they appreciate the trust that people show in them, and our platform allows for individuals or groups to fundraise for any charity at no cost to the charity whatsoever, ensuring more money ends up for the charities to continue on providing a valuable service to Irish society.
An obvious question to ask is: why are we doing what we’re doing? In a nutshell, the answer is simple: Because it needs done. Increasing transparency benefits everyone; the Irish public and the charity sector alike. At Altruism Ireland, our belief is that transparency builds up much needed trust among potential donors which should hopefully lead to increased mindful giving as a consequence. Our ultimate aim is not only to maintain Ireland’s status as a highly generous population -- The World Giving Index by the Charities Aid Foundation has consistently ranked Ireland in the Top 5 most charitable nations -- but also to be the most efficient and transparent one.
Which organizations do you include?
Because we aim to help givers and to celebrate charities nationwide, we use one simple guideline for choosing which organizations to include. We only include organisations to which the Office of the Revenue Commissioners, Charities Section have granted charitable tax exemption. In granting tax exemption Charities Section give the body a CHY reference number.
How can I get Altruism to include my favourite charity?
You can send us an email indicating your favourite charity in the "Contact Us" page here.
Why is the charity that I support not present on your website?
It probably means that the charity has not signed up yet or that we have not been able to include it yet. There are thousands of charities in this country and we will do our best to support as many as we can.
How do I find a charity on your site?
You can use the search bar on our website and rank charities based on our Transparency score. Our smart search engine will help you identify a charity by name or keyword. Then you can refine your search using the "Filter by Location", "Filter by Size" and "Filter by Category" functions and sort the results by "Near to you", "Highest rating" and "New charities".
Additionally, you can filter charities that are looking for volunteers.
FAQs ABOUT THE TRANSPARENCY SCORE
Where does the Transparency score come from?
We base our Transparency score on the information each charity provides on our website. Charities submit this information and make a self-declaration that the information is accurate and reflects the truth.
How is the Transparency score calculated?
We issue an overall Transparency score that combines the charity's performance in three broad areas.
- Transparency on the Projects: The score is calculated based on the information shared by the Charity in relation to the projects they want to carry out in the current year. We ask the charity to:
- Public telephone – Write the main public telephone number of the charity
- Public email – Write the main public email address of the charity
- Short description of you – Write a description of the charity mission
- Subcategory of activity – Publishes the subcategory of activity of the programs provided by the charity
- Cities where active – Write one or more cities where the charity has active programs
- Video URL – Link a short video introducing the charity
- The cause you address – Write a description of the overall cause that the charity addresses
- The response you propose – Write a description of the response that you propose
- Fundraising objective – Write the total fundraising objective that the charity wants to raise to finance the projects for the current year
- Projects – Write three or more specific and measurable projects that the charity plans to carry out during the current year.
- Transparency on the Results: The score is calculated based on the information shared by the Charity in relation to the results achieved in the previous years. We ask the charity to:
- Results – Write the result achieved for each specific and measurable project that was planned the previous year. The results can be shared within 3 months from the end of the previous year. During the first year in which the charity is registered on Altruism’s website we assume that the results have been shared.
- Transparency on the Financials: The score is calculated based on the information shared by the Charity in relation to their allocation of financial resources. We ask the charity to:
- Total Income – Write the total income of the charity of the previous year. The income can be written within 6 months from the end of the previous year.
- Total Program Expenses – Write the expenses on programs and services of the previous year. The expenses can be written within 6 months from the end of the previous year.
- Fundraising costs – Publishes the fundraising costs of the previous year. The expenses can be written within 6 months from the end of the previous year.
- Financial report – Upload the financial report of the previous year. The report can be uploaded within 6 months from the end of the previous year.
- CEO name – Write the CEO name.
- CEO compensation – Write the CEO compensation.
- Board Members' names – Write the names of the board of director members.
The methodology that we use in the scoring system, including the information that is evaluated and the weights, is clearly communicated to all charities because we want to enable them to achieve the highest transparency score.
Should I use your score exclusively to determine if I should support a charity?
We believe our score will dramatically improve the quantity and especially the quality of information available to givers. Our score provides clear, objective, and reliable assessments of the transparency of charities. By using our score, givers can be confident that in supporting those charities scored highly by Altruism, they will be supporting organizations that committed to communicating externally their projects, results and financials. We do not recommend using our score as the only factor in deciding whether to support a particular organization. Givers should also seek out additional information from charities directly.
What is your score scale?
The Transparency score is calculated on a scale from 0 to 10.
How current is the Transparency score?
We base our Transparency score on the information from the previous year and the current year. Our score is based on the most current information made public by each charity.
When do you update the Transparency score?
The Transparency score is updated in real time when the charity publishes new information.
Does disclosing or not disclosing the CEO salary affect a charity’s transparency score?
Yes. We include the CEO salary solely as part of our larger effort to bring transparency to the charitable sector and to help donors make informed decisions. A charity that publishes the CEO salary is considered transparent independently from the amount of the salary paid. Ultimately it is a matter of personal sensitivity to decide if a salary is appropriate for the level of responsibility and amount of hours a CEO works. Moreover, in order to attract an applicable CEO capable of leading and driving forward a charity’s vision, it is worth bearing in mind that an organisation will often need to offer commensurable compensation, appropriate to the size, impact and structure of the organisation. While there is no one way of determining what is commensurable, one method is to view CEO compensation as a percentage of total expenses. For example, a charity CEO compensation of €100,000 for an organisation spending €10 million per year (1%) probably seems much more reasonable than the same salary for a organisation with total expenses of €1 million (10% of expenses for one person).
Why do you not score the charity's effectiveness?
Evaluating the effectiveness of a charity's programs is out of our scope. Our goal is to increase the level of transparency and reduce the cost of fundraising. We believe that mindful giving will bring more effectiveness as a consequence.
Is it better to support one charity or many charities?
We suggest that you take the time to find a few well-run charities that match your interests and make a commitment with a monthly donation. Charities can work better when they have a stable flow of donations to be invested in their programs.
FAQs ABOUT TAX DEDUCTIONS
Can I deduct my giving?
For every donation that you make, both single and monthly, Altruism provides a receipt from the charity to back up any tax claim that is permitted.