Funders Should Do More to Help Nonprofits Build Evidence

Announcing the final funding guidelines for the Social Innovation Fund last week, the chairman of the Corporation for National and Community Service Board said, “It’s just crystal clear we can’t continue to be funding social programs the way we’re funding them without more evidence of success.”

As I discussed in my last post, I see the Social Innovation Fund – and its focus on evidence – as a welcome push in the right direction. While there have been funders and nonprofits that have worked hard to assess effectiveness over the past many decades, we remain well short of where we need to be.

Admittedly, assessment in philanthropy is complex. It happens at multiple levels:  1) determining which grantees to fund; and 2) assessing a foundation’s own overall effectiveness. These two levels are interrelated, of course, but each has its own set of challenges.

Cutting to the heart of the first level’s challenges are the requirements in the SIF Notice of Funds Availability’s “Applicant’s Track Record of Using Rigorous Evidence to Select, Invest in, Support, and Monitor the Grantees” section. Funders must describe the process they use to “incorporate evidence into the selection, investment, support, monitoring, replication, and expansion of your grantees” and provide “in detail specific examples of how your organization has used rigorous evidence to drive program improvement and increase the base of evidence of what works.”

Neither of these requirements would be easy for most foundations to fulfill.

Today, too few funders use “rigorous” evidence to select the nonprofits they fund or to drive the development of their own goals and strategies. But, while I applaud the push that SIF NOFA requirements provide, any move in the direction they suggest must be made thoughtfully.

These guidelines should not be taken as an invitation to put the onus on grantees to suddenly produce evidence of their effectiveness independently. As I said in my post last week, many nonprofits are understaffed and underresourced, lacking the people, skills, and/or funds to conduct evaluations or collect data. Funders should proactively offer support – monetary and nonmonetary – to help grantees develop the needed systems and data to more rigorously test their effectiveness.

Today, too few funders provide the needed support for nonprofits to build better evidence bases about their work.  At CEP, we have analyzed data from over 30,000 surveys of grantees of nearly 250 funders, and the facts speak for themselves:

  •  Just 11 percent of grantees report that their funder helped them with the development of performance measures
  • Only 11 percent say their funders provided them with research or best practices
  • Of the 58 percent of grantees who reported having participated in a reporting or evaluation process, less than half (44 percent) report that after submitting a report or evaluation, their funder or an evaluator discussed it with them

These facts have consequences.  We know from our data, for example, that when discussions of a report or evaluation do not happen, grantees find the reporting/evaluation process to be much less helpful in strengthening their work.

Funders have an opportunity – and an obligation – to step up and share responsibility for the development of more rigorous nonprofit performance data.  Because if nonprofits are in a better position to answer questions about what works, funders will be able to better decide where to direct their resources, and subsequently have  more answers to questions about their own effectiveness.

If the Social Innovation Fund can act as an impetus for this kind of evolution, that is a very good thing indeed.

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Ellie Buteau, PhD, is Vice President-Research at CEP

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