Charity Navigator Rates Clinton Foundation 4 Stars: Every Other US Charity and Donor No Longer Needs to Bother
This morning, I saw a notice that an east coast newspaper had written an article that the reliable charity evaluation organization, Charity Navigator, had suddenly rated the Clinton Foundation 4 stars after previously unrating the organization. In addition, Charity Navigator participated in the Clinton Global Initiative between 2012 and 2014, according to the Associated Press. Ordinarily participation in the CGI costs $20,000 and up; Charity Navigator’s CEO Michael Thatcher is on record saying the membership was complimentary to their organization, and they treated it as an “in-kind donation.”
Bernie Sanders voters in California will recognize the source of this story right off: it’s from the AP.
It should be a mark of how “important” the third or charitable sector is in the US that I have just reviewed the industry standard “rater” Charity Navigator’s ranking system, and it would be substandard and inadequate if used to rate or rank even a small-to-medium for-profit company. There are many competing systems and methods that rate, rank, assess and evaluate publically-traded companies. Publically-traded companies also provide quarterly financial reports and annual reports to stockholders that dwarf even the most thorough nonprofit/public charity annual reports.
The original purpose of these charity “ranking” systems was to inform the public of charities that were inauthentic or “scammers” — i.e. the “fly by night” operations that work out of telemarketing call centers, taking donations from credulous people over the phone. Then the ranking systems began to be used by larger funding organizations, such as corporate giving programs or private foundations. In order to be considered for all but the smallest gift, charitable organizations needed to have their profiles up to date and have reliable, correct information that fits within certain basic parameters (i.e. not too high “administrative” costs as compared to program expenditures).
So, apparently Charity Navigator suddenly decided that the same documents that put the Clinton Foundation on the “Watch List” in 2015 (its 2014 tax filing form 990 and audited financial statements) now qualify them for top ratings — including “transparency.”
So, Charity Navigator’s former head Ken Berger “left abruptly” in April, 2015. The organization is about three times larger than Charity Watchdog/American Institute of Philanthropy, with its $550,000 a year budget and 6–7 staff. The CEO joining the organization in August, 2015 is Michael Thatcher, former Microsoft “Public Sector Chief Technology Officer (CTO) responsible for technology policy initiatives and engagements with government and academic leaders in the Middle-East, Africa and Asia.”
I could go point by point and illustrate how Charity Navigator, which used to be respected, but likely without much good cause, has gone wrong with the announcement — about as “neutral” and “non-political” as the AP announcement that Mrs. Clinton was the Democratic presidential nominee the day before the California Presidential primary, the first one in which state residents’ votes had any impact in a primary for many years.
Here’s one fact: Charity Navigator always did update its records based on the organization’s tax return. From their website: “Once we have a new Form 990, we promptly update the charity’s record and publish a new evaluation on the first of the following month.” 990s must be filed no later than “15 days after the fifth month after the close of the organization’s fiscal year.”
Considering the craptastic state of the Clinton Foundation’s information and records, I had some difficulty determining the organization’s fiscal year. It is 1–1 to 12–31.
So, you can see to the left — the tax return is due May 15 of the year following the end of the prior fiscal year.
So “top ranking charity evaluator” the ones I used to respect based on, honestly — I don’t know — just gave a top rating for a tax return covering an accounting period of almost two years ago.
The 990 that I can see, the “4 star ranking” one — is signed 11/16/2015.
Combining two years of audited financial statements in to one are also a hallmark of a top-rated, 4 star A+ charity.
I’ll just close here by saying that the staff changes at Charity Navigator, including the appointment of an unqualified former Microsoft employee with “CTO” experience and their public statements that they want to become a “data” and “technology” company mean that whatever potential the organization may have had in aiding the ever-shrinking nonprofit sector in developing actual benchmarks and metrics for effectiveness as opposed to analyzing meaningless tax returns an 8th grader could game — is over.
The organization has stopped its work in trying to evaluate program effectiveness (apparently having achieved over 3,000 ratings or information about 3,000 organizations) and is “reassessing” this aspect of its rankings.
Charity Navigator notes that one financial portion of its rankings (grossly meaningless in the case of the Clinton Foundation due to its lack of programs) involves growth in program spending year after year.
First, one cannot see this with the Clinton Foundation, particularly due to the amended tax returns and reports, and second, how can this be seen as a good thing across the board? Sometimes less expenditure is better, meaning greater efficiency. Not endless increases.
Maybe they’re just talking about “good enough for government work.”
Oh, and Mark Cuban? Financial endowment growth in a charitable organization might mean that the organization has deep support for its mission. The Clinton Foundation doesn’t have a mission. Or it might just mean increased millions from Saudi Arabia, Gilbert Chagoury and mysterious others donating to the Clinton-Giustra Global Partnership.
And Thatcher? In your world, if you fail you just get promoted, isn’t that right?
One of the main outcomes stated by the Clinton Foundation on their website your organization so thoroughly reviewed is “children in 31,000 US schools have healthier food because …”
That’s this organization. Alliance for a Healthier Generation. They are a July 1-June 30 FY organization.