An Analysis of Rating Systems Used by Watchdog Organizations for Nonprofit Charities in the Health and Human Services Sector
Date of Award
Moore School of Business
Director of Thesis
Dwight David McIntyre
In the United State, lack of trust and accountability are developing trends among donors in regard to charitable nonprofits in the health and human services sector. Watchdog organizations are working diligently to provide useful data to donors to combat this growing issue. While some watchdog organizations focus on quality of statistics, others focus largely on quantity of metrics. Additionally, some rating systems are solely based on financial data, while others consider nonfinancial data as well. Although different methodologies concentrate on varying metrics, this thesis seeks to find a comprehensive, yet easy-to-use rating system that allows users to understand both financial and nonfinancial data. In comparing this proposed system with current methodologies for specific charities, overall ratings did not differ as greatly as hypothesized. Because managerial decisions and financial health correlate so closely, the focus on financial versus nonfinancial data in rating systems created little difference in overall grades. Additionally, the focus on quality over quantity, and vice versa, seemed to create almost no difference in ratings. Although this difference in ratings was not large for different ratings systems, using portions of certain rating systems can benefit individuals if they have more concerns in one area of a charity’s business than another. Through this research and analysis, it can be concluded that individuals can trust current watchdog organizations in regard to overall ratings. However, discretion is still advised, and this thesis recommends verifying the accuracy of scores on published websites before donating to charities in the health and human services sector.
Strathmann, Sara, "An Analysis of Rating Systems Used by Watchdog Organizations for Nonprofit Charities in the Health and Human Services Sector" (2018). Senior Theses. 262.