Donors Prefer Charities that Earn All Four Beacons

Charity Navigator's Encompass Rating System 

Two years ago, Charity Navigator introduced the Encompass Rating System, affording donors a holistic view of a charity’s effectiveness and reliability through an expansive, nuanced, and evolved method of evaluation, beyond finances alone. The framework illuminates the overall health and performance of an organization in four key areas, referred to as “beacons”: Leadership & Adaptability helps donors understand if a charity has clarity of purpose, Accountability & Finance explains if they are transparent and fiscally capable, Culture & Community shows who they are and how they engage with their constituents, and Impact & Results explains what they have accomplished. Charities are scored in these areas and earn beacons by claiming their Charity Navigator profiles via the Nonprofit Portal and providing additional information on their efforts.

To better understand donor perceptions on beacons, we conducted a survey with 865 participants. The top-line finding is that donors overwhelmingly prefer charities that have earned all four beacons. When comparing a four-star charity with only one beacon to a four-star charity with all four beacons, 79.8% of participants preferred the organization that earned four beacons.