Stronger charities demonstrate impact

Following the publication of the House of Lords select committee on charities’ report Stronger Charities for a Stronger Society (PDF, 1.7MB), we are publishing a series of posts covering the take-away issues and what charities can do in response, highlighting what we think are the best available resources to help you if you want to take action:

• governance
• funding and finance
• regulation
• public services and contracting
• campaigning and advocacy
• digital
• public trust and confidence
• volunteering
• next steps for infrastructure: An action plan for implementing the report.

The Lord’s report recognises a greater current expectation on charities to demonstrate their impact. It provides some broad suggestions for ways in which organisations might do this, and encourages further work among public-sector commissioners to facilitate this. In this post we examine the evaluation and impact-related content in the report.

The impact agenda

The report explains that there is a greater focus on how charities measure and demonstrate the impact they make, which is being driven by increasing expectations of transparency and the move from grant funding to contracts. Witnesses to the committee felt that charities should be accountable and able to demonstrate the outcomes of their work.

The focus on impact is something we at NCVO Charities Evaluation Services welcome, and have encouraged through our own work over the last few decades.

The report endorses the suggestion in the Governance Code that charities should provide regular information to their stakeholders so that they can measure the charity’s success in achieving its purposes. See our recent governance blog for a look at the work we’re doing on this.

References from witnesses about how important it is for charities to consider their accountability to a range of different groups – beneficiaries and the public, as well as funders, commissioners, donors, the Charity Commission and regulators – are particularly welcome.

Practical ways for charities to put impact measurement into place

The report recognises that charities may need support around evaluation and impact measurement. We see this through our own work – many charities have made much progress, and are employing sophisticated evaluation techniques, but the level of knowledge and confidence around this kind of work varies across the sector.

The report welcomes the Inspiring Impact initiative, which NCVO is part of, and which aims to help charities improve their impact practice. This is a useful recognition for the importance of sector-wide support initiatives in encouraging and enabling voluntary organisations to focus on impact.

A helpful starting point for charities wanting to improve their work around impact is Inspiring Impact’s Measuring Up! diagnostic tool: it helps organisations assess their progress in impact practice, and comes in tailored versions for small and medium sized charities. NCVO also provides a range of support to help charities with impact measurement and evaluation. NCVO Knowhow Nonprofit has free information, practical how-to guides and examples to help voluntary organisations plan and measure their impact.

The Impact Management Programme, another sector initiative referred to in the report, currently involves charities in designing support materials so that they are as practical and useful as possible. We are partners in this programme and will be discussing challenges around impact data at a fringe event before our annual conference on 20 April.

The role of independent evaluation

The report recommends that all charities should be seeking independent evaluation of their impact, and usefully recognises that the form of that evaluation may differ depending on the charity’s size and the type of work they do. Independent evaluation – a service we provide – has a range of benefits: it can bring a fresh, external perspective and may mean that less time is needed for activities such as primary data collection in the organisation being evaluated.

But it is important for charities – and, by extension, their funders – to set sufficient budget aside for effective independent evaluation. The report acknowledges that some charities reported difficulties in securing sufficient funding to support impact measurement. We provide guidance on what organisations should consider when costing an independent evaluation.

A focus on independent evaluation should not detract from the importance of self-evaluation – charities being able to assess their impact themselves. ‘Assessing outcomes and impact’ is an important component of a quality organisation – for example it forms one of the eleven quality standards in PQASSO. Having evaluation skills and implementing ongoing monitoring (collecting information to assess progress against plans) can help charities be in the best possible position to identify organisational learning points and use these to help them improve. Most independent evaluations are also strengthened by having robust internal data to draw on.

NCVO Charities Evaluation Services runs a range of training courses to help organisations develop self-evaluation processes.

Commissioning for impact

The report recommends that steps are taken so that commissioning is  based on impact and social value rather than simply on the lowest cost. It recommends that the Office for Civil Society should develop guidance for the public sector on how to set contractual impact reporting requirements appropriately and in a standardised fashion to reduce the bureaucratic burden on charities. We welcome this and have worked with a number of funders who are committed to being outcomes focused and proportionate. While it may not be possible to completely standardise, there is certainly merit in agreeing common language and a core set of reporting requirements –perhaps some key outcome or impact-focused questions that all funders and commissioners can ask. However what is meant by ‘proportionality’ in terms of reporting also needs to be considered and agreed on before such a core or set of standards can be finalised.

NCVO have guidance for funders wanting to make their outcomes reporting proportionate. . We are currently refreshing this guidance so watch this space!

We recommend that funders and commissioners take the opportunity to use Measuring Up! to diagnose where they could improve their monitoring and evaluation practice. We provide training (at NCVO or at your premises) for funders and commissioners who would value the opportunity to improve their impact practice.