Use of Performance Assessment Up at Foundations, Proof of Impact Elusive, Report Finds

Although foundations have boosted efforts to assess their performance with respect to the organizations, fields, and communities they serve, foundation leaders remain dissatisfied with their ability to measure the effect of their organization's work with any specificity, a new report from the Center on Effective Philanthropy finds.

According to The State of Foundation Performance Assessment: A Survey of Foundation CEOs (20 pages, PDF), data-driven forms of measurement have become more widely used to evaluate the results of programs. But while foundation CEOs place great importance on assessing their foundations' effectiveness and believe they have played a role in improving their organization's performance-measurement practices in recent years, they also feel there is room for improvement. The report notes that foundations appear to be using a broader range of information to assess their financial, operational, and programmatic performance than a decade ago, and that many are combining that information in interesting ways to assess overall performance.

Almost three-quarters of the 173 CEOs of the foundations surveyed reported that the assessment of foundation effectiveness is among their highest priorities. However, more than 60 percent said too few foundations really have a solid grasp of their organization's overall performance. And almost 60 percent said they believe nonprofits should be held to a higher standard in terms of demonstrating the effectiveness of their work.

"It is important to stress that there is significant work to be done before foundations can answer that tough question, 'How are we doing?' with real confidence," said CEP vice president for research Ellie Buteau, who was lead author on the report. "And the perceived conflict between assessment and innovation merits serious consideration. But it is important to note that the pursuit of assessment has intensified for foundations."

"Performance Assessment on the Rise at Large U.S. Foundations but Proof of Impact Remains Elusive." Center for Effective Philanthropy Press Release 09/07/2011.