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Comment: A revolution the sector should join

By Nick Seddon, Third Sector, 19 September 2007

Nick Seddon

"A reform is a correction of abuses," said the novelist Edward Bulwer-Lytton. "A revolution is a transfer of power."

Depending on whom you talk to within the rather parochial world of the third sector, it's not uncommon to hear people sneering about Guidestar, or New Philanthropy Capital, or Intelligent Giving, or the Institute of Philanthropy - or all of them. I wouldn't be surprised if these organisations sneer about each other, too, but they share an exciting quality, which is that they are all, in their different ways, powering a revolution.

Precipitated by changes within the sector, it is an information revolution, which challenges the assumption that charitable status alone is proof of effectiveness. For if charities receive taxpayers' money to do things state departments were once audited for doing, it is reasonable to ask if there is any identifiable benefit or added value for the community when the service is run by a charity as opposed to a state department. Some are even suggesting that government needs to invest in performance research to head off public accountability scandals, which would make research a form of due diligence.

Many charities object that what they do is qualitative, not quantitative, and that their currency can't be valued in a marketplace, as if there were something grubby or rude about analysing charities and their work. But surely all charities should be seeking to evidence their own outcomes, at the very least as a way to attract donations. Surely an organisation that isn't trying to measure and evaluate its performance isn't well run.

Big grant-making trusts and foundations have long employed sophisticated frameworks for gathering information about the performance of the bodies they fund. All the new analysts are doing is making this information freely available to us all. This can be a top-down process - but from a research infrastructure involving umbrella bodies, academics and the state, it can come from the bottom up too, a point not lost on Guidestar and NPC, which offer websites on which charities can post their own results.

With information, the satisfaction of demand creates more demand. Revolutions are rarely easy, but the sector would do well to embrace this one.

- Nick Seddon is an author and journalist.