Charities: How important is performance to donors?

Purpose - This paper seeks to develop insights into the charity selection criteria used by individual donors, and the information that charities provide to individual donors. Design/methodology/approach - Charities are defined as organizations involved in health, international aid, wellbeing, and nature and environment. In this paper the main focus is on one type of charity stakeholder; the individual donor. The research is undertaken through an internet survey among Dutch donors and through interviews at eight case studies of Dutch charities. Findings - Based on the internet survey it can be concluded that effectiveness is seen as important, but not as the major criterion in the selection of a charity. The case studies show that charities do not have standardized reporting systems in order to inform their donors on their performances Practical implications - Based on this research it can be concluded that there is a need for management of charities to develop both measures of internal efficiency and of external effectiveness. Originality/value - The literature review identified a lack of empirical data available on the charity sector; this paper tries to fill that gap.

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