Nonprofits, here’s how you can start making a difference:

• Demonstrate ethical practice and share data about your performance.

• Manage towards results and understand your true costs.

• Help educate funders (individuals, foundations, corporations, and government) on the real cost of results.

The tools and resources listed below can help nonprofits move beyond the Overhead Myth, toward the Overhead Solution, by proving their worth based on impact.

Demonstrate ethical practice and share data about your performance. 

• Check BBB Standards for Charity Accountability for recommended practices on governance, finances, fundraising and more.  
• Read Charity Navigator’s Accountability & Transparency methodology.
• Update your GuideStar Nonprofit Profile to share information about how your organization is governed.
• Read Independent Sector: Principles of Good Practice & Governance to learn best practices in operations improvement.
  
• Visit www.performwell.org to complete the performance management cycle.
  

Manage towards results and understand your true costs.

Strive to make a lasting impact.

• Read Leap of Reason by Mario Morino.
• Join the Lean Impact learning community to better utilize Lean Startup Principles.
• Read “Zeroing in on Impact” by Susan Colby, Nan Stone, and Paul Carttar, Stanford Social Innovation Review, Fall 2004.
• Review Charity Navigator’s Results Reporting methodology and concept note.
• Review the Effectiveness Reporting section of the BBB Standards for Charity Accountability.
• Visit www.outcomestoolbox.com.

Understand your true costs.

• Visit www.strongnonprofits.org to build your organization’s fiscal strength.
• Consider Nonprofit Finance Fund’s tools and resources.
• Check out Charity Navigator’s Financial Health metrics.
• Read the Financial section of the BBB Standards for Charity Accountability.
• Visit the Donors Forum Real Talk about Real Costs.
• Review the Not-for-Profit Industry Audit Guide published by the American Institute of Certified Public Accountants.

Help educate funders (individuals, foundations, corporations, and government) on the real cost of results.

Engage in a conversation with your donors explaining the detriment of the Overhead Myth.

• Share the information in this Overhead Myth (to the nonprofits of America) as well as the original letter (to the donors of America). Both letters have a Creative Commons License- Attribution-No Derivs CC BY ND, which means that as long as you attribute the idea to BBB Wise Giving Alliance, Charity Navigator, GuideStar, and the Overhead Myth campaign, you can use either letter to communicate the message to your donors.
• Read OMB Circular A-122, Cost Principles for Non-Profit Organizations, which “provide that the Federal Government bear its fair share of costs except where restricted or prohibited by law.”
• Engage in a dialogue with your stakeholders using tools such as:
  • Charting Impact.
  • Financial SCAN.
  • Impact Calls.

Additional Resources

• America’s Charities’ Snapshot 2014.
• “Anatomy of the Nonprofit Starvation Cycle,” presented by Jesse D. Lecy and Elizabeth A.M. Searing, at the November 2012 ARNOVA Annual Conference.
• Bridgespan Group’s publications and tools.
• Donors Forum: Real Talk on Real Costs.
• National Council on Nonprofits’ resources.
• “The ‘Overhead’ Pledge,” by Sue Dorsey, PhilanTopic, August 21, 2014.
• Charity Navigator CEO Ken Berger’s blog posts on effectiveness and results.
  
• “Financial Leadership for Nonprofit Executives,” by Jeanne Bell and Elizabeth Schaffer.
• “Nonprofit Sustainability: Making Strategic Decisions for Financial Viability,” by Jeanne Bell, Jan Masaoka, Steve Zimmerman.