Policy Brief

Millions of donors rely on third-party ratings to decide which nonprofits deserve their charitable dollars. But what if those ratings say nothing about how well an organization actually performs?

This brief describes how donors respond to GuideStar's transparency seal ratings and what that means for nonprofit accountability.

The author finds that even ratings not tied to verified performance significantly influence giving, with platinum-rated nonprofits receiving 34% more in donations than unrated ones, and that donors do not penalize poorly performing nonprofits that hold ratings.