Study: Nonprofits That Follow BBB Standard Guide Raise More Money

Nonprofits that follow the Better Business Bureau’s Wise Giving Alliance Standards for Charity Accountability raise more money via donations, a recent study found  (opens in a new tab).

Specifically, the research by professor Greg Chen of the City University of New York’s Baruch College looked at charities’ records from the years between 2006 and 2011. His analysis  (opens in a new tab) [PDF] showed that charities in the national sample that adhered to the 20 BBB WGA standards raised roughly 8 percent more in fundraising revenue; in the Metro New York sample, charities that met all the guidelines reported a 13.5 percent fundraising increase. The study linked the rise to their BBB accreditation. More details:

About the guidelines: The BBB WGA standards  (opens in a new tab) serve as a nonprofit best-practices guide to fundraising. The rundown covers a range of advice, from emphasizing transparency in governance and breaking down expenses to laying out strategy for measuring effectiveness and responding promptly to complaints. According to Chen’s study: “Charities that meet all BBB standards become ‘BBB Accredited Charities,’ a status that is displayed for public review and consideration on the BBB website…. Participating in the BBB’s Charity Review Program and meeting all BBB standards is demonstrably associated with stronger fundraising results, and is therefore
recommended as a consideration for charities that seek to increase revenue from donative sources.” These findings are similar to results to of Chen’s 2009 study of Metro New York charities that implemented BBB standards. “Meeting BBB standards is associated with higher levels of public support,” the report noted.

What to do: Even organizations that don’t fully adopt the standards in all the details can use them as guideposts for building trust with the public. In a blog post for marketing software company HubSpot,  (opens in a new tab) Taylor Corrado writes that all marketing material—online and hard copies—should be up to date and, most important, truthful. Annual reports in PDF form should link to the organization’s website, Corrado advises, and the nonprofit should detail how it works with for-profit organizations and benefits from the sale of products.

By following protocol, nonprofits can demonstrate accountability and cultivate trust among those who choose to donate, Corrado notes. Organizations can use the standards to gauge their productivity, improve their operations, better handle finances, and, ultimately, communicate more effectively with the public—as well as potential donors.