5 actionable ways to vet a charity

Many philanthropists are wondering how to make a meaningful impact amid a heightened focus on structural inequities in education, housing, healthcare, food security and financial stability and their effects on people of color in general and Black people in particular.

Derived from the Greek word “philanthropia,” philanthropy translates to “the love of humanity.” And it’s heartening to know that our love of humanity has technically been growing for decades. According to Charity Navigator, giving in the U.S. has increased in current dollars every year since 1977, with the exception of 1987, 2008 and 2009, which all marked major economic crises. As we prepare to welcome a new decade of goodwill, you may have started thinking about the organizations and causes you wish to champion.

Even with the chaos and market volatility surrounding COVID-19, charities and donors have stepped up to help those in need. In fact, Candid and the Center for Disaster Philanthropy have tracked over $3.1 billion in philanthropic support for those affected by coronavirus, from individuals who’ve fallen ill to small businesses struggling to cope. As we continue fostering our sense of goodwill, there are steps you can take to help make the most of your philanthropic aspirations.

While we’d like to believe all nonprofits are helping change the world for the better, it’s still essential to research the organizations you want to support. This is especially important when giving large gifts or volunteering your time. That’s why, to help you do your due diligence and ensure you’re supporting reliable charities, we’ve compiled five actionable ways to vet a nonprofit:

1. Research the charity’s history, including how long they’ve been around, the type of supporters they have and their funding sources. You can learn more about their reputation by looking up news stories and seeing how they’ve been portrayed in the media.


2. Visit their website and social media. Explore what others are saying about them, what they’ve accomplished and the impact they’ve had. For instance, the following charities have received recent recognition for their dedicated response to COVID-19: Direct Relief, Team Rubicon, United Way Relief Fund, CDC Foundation and Feeding America.


3. Check their credibility using sources like CharityWatch, GiveWell, BBB Wise Giving Alliance and Charity Navigator, the largest evaluator of charities in the U.S. You can also rely on Candid to find financial statements, 990s and other important details.


4. Look for independent audit reports, an examination of the financial records, accounts, business transactions, accounting practices and internal controls of a nonprofit by an independent auditor (meaning an auditor who is not employed by the charity).


5. Avoid automatically dismissing charities with a high overhead, which refers to the costs of things like staffing, marketing and fundraising. According to a TED Talk by AIDSRide founder Dan Pallotta, charities with high overhead costs can sometimes fulfill their mission even more effectively than those with lower costs. That’s because they have more resources to invest in valuable talent, new ideas and strategies to maximize their impact.

We hope you find these tips helpful as you seek the best charities to support. In the end, it’s all about asking the right questions and ensuring a nonprofit’s values align with your own. And to learn more about the charitable response to COVID-19, including the steps funders are taking, visit Candid.org.