Henley Management College's Centre for Voluntary Sector Management and the Institute of Fundraising have launched a benchmarking pilot to enable the public, media and government to compare fundraising costs.
If enough organisations participate, the initiative will offer the most comprehensive window yet on charities' spending while at the same time providing context and explanation.
Questionnaires will hit the desks of fundraising and finance directors at the UK's top 500 charities next week. Information drawn from finance directors' trial balances, the raw financial information which later gets fed into charity's annual accounts, will be fed back to Professor Adrian Sargeant at Henley and then incorporated into a web site to be launched early next year.
The Strategy Unit's review of the sector has recommended that the sector be given a last chance to regulate itself, and called for measures to improve transparency and information provided to donors, the public and beneficiaries.
Sargeant made a plea for charities to participate with the pilot if they wanted to beat off the prospect of league tables imposed from outside.
"This is the sector's opportunity to explain its performance and provide information to donors,
he said. "If the sector fails to tackle these issues, then the Government may look again at statutory options for such reporting."
The institute has liaised with the Charity Finance Director's Group to determine which parts of charities' trial balances should be used to make meaningful comparisons between charities.
Ailsa Ogilvie, in charge of income generation for Age Concern England, has been involved in the early stages of the pilot and has seen the questionnaires.
"Unless we get a grip on this ourselves, someone else will do it for us,
she said. "Charities should get involved and influence the process and make sure we achieve something meaningful that improves public confidence."
The questionnaire is three-pages long comprising two pages of questions and one page of guidance notes, with space provided for charities to explain the factors behind their fundraising costs.
"If say they're doing some donor recruitment that does little more than break even (in the first year),
said Sargeant. "But this is very much a pilot - we may need to modify some of the questions."
The Institute of Fundraising, NCVO and the Charity Commission will consult with CAF on the proposal in the next few months.