Donors have been stepping up their game to measure the impact of every aid dollar spent. Should nongovernmental organizations start doing the same?
CARE launched in November a report that tries to address a number of questions thrown against the organization. Donors are curious if the organization achieves value for money; supporters ask if donations reach those most in need; skeptics continue to wonder whether CARE is really making any difference.
The report included data on project impact and outcomes from a number of Asian countries where CARE works. And, among other things, it provided CARE a “better understanding” of its impact in the region and areas for improvement, CARE Australia Manager of Quality and Impact Andrew Rowell writes for the Development PolicyBlog.
Case studies in the report, for example, show that for every dollar invested in CARE’s programs, there’s between $7 and $42 social return on investment. In the case of a plantation community empowerment project in Sri Lanka, every dollar generated a return of approximately $42.60, benefiting communities, tea plantations and estates, and the government.
But CARE, Rowell said, needs to “do a lot better” on a number of things, including improving its impact measurement processes. Rowell acknowledges, however, that the approach “may be unique among NGO reporting.”
Very few NGOs produce such reporting, although a number of donor policies are already encouraging them to do so. Australia, for one, aims to reward NGO programs that have demonstrated effectiveness and impact. Under its new Civil Society Engagement Framework released in June, the donor also aimed to develop an assessment methodology measuring an organization’s effectiveness that will figure in its funding decisions.
“The idea of impact should get to the heart of our sector: why we do what we do, why it’s the best thing to do, and why people should trust us,” Katherine Smithson of the Charity Finance Group once said in a blog post for the Guardian.
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