Opinion: Third Voice - 'Value for money' is a difficult concept to measure

Alan Gosschalk, chair of the ImpACT Coalition

Mick McAteer of Which? welcomed the implementation of self-regulation of fundraising (Third Sector, 17 May), but argued that much more needs to be done to ensure greater accountability and transparency in the sector.

I share his enthusiasm for the self-regulation of fundraising, but the Fundraising Standards Board is not alone in its drive to improve accountability. It is one of a number of initiatives, such as the ImpACT coalition and the Standard Information Return, that will give charities the tools to demonstrate good standards with greater clarity.

When comparing charities' effectiveness, McAteer's views are overly simplistic. Most charities achieve a high 'return on investment', but a simple cost-income ratio can't be the most accurate comparative factor.

Each charity's expenditure and investment in fundraising will vary year on year according to the attractiveness of their causes and their longer-term fundraising strategies. Legacy fundraising might be one of the most cost-effective fundraising techniques, but its income will take years to materialise. A quick comparison of costs with income gives a very different impression of overall efficiency, depending on the year in which figures are reviewed. Results need to be put into context.

It is a priority for charities to measure and report on the impact of their work in a better way, and many have started down this route. But charities represent widely different causes, are of varying sizes and have very different sources of funding. Each has a different story, so it would be impossible to rate every charity on one definitive, consumer-friendly reporting scale of 'effectiveness'.

The public must be able to make informed choices, and it is a challenge for charities to present their cases. They should be allowed to demonstrate their unique attributes to donors and potential supporters, but their accountability measures must also be flexible enough to allow appropriate progress reporting.

Many charities are committed to improving transparency and accountability - more than 70 charities and trade bodies (including the top 20 fundraising charities) have already joined ImpACT. They recognise that increased accountability and transparency are key to raising public trust and confidence. Each member charity considers it a priority to become even more effective.

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