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June 16, 2014

Our Position on Charity Ratings

The Humane Society of the United States is approved by the Better Business Bureau’s Wise Giving Alliance for meeting all 20 of its standards for charitable accountability. We were named a few years ago by Worth Magazine as one of the ten most fiscally-responsible charities in the country. Guidestar’s Philanthropedia experts have ranked us the No. 1 high-impact animal protection organization (peer organizations and funders in animal protection were asked which group in the field is most effective). And the NonProfit Times recently named our president and CEO for the fourth year in a row to its list of the Power and Influence Top 50 executives, in recognition of The HSUS’s achievements under his leadership (there are more than 1.5 million charities in the U.S.).

While we do value and appreciate such affirmations, and believe that we’ve earned them, it’s unwise for any donor to rely exclusively on charity watchdog reviews of The HSUS or any other non-profit organization. Charity evaluation is complex work, and in many cases the watchdog groups do not seem to understand the dynamics of social reform or the operations of advocacy organizations working in the nonprofit sector. They often rely on strictly numerical measures that do not capture either efficiency or effectiveness or the degree of difficulty of the work they engage in.

That’s the case with Charity Navigator, which recently issued a factually incorrect “donor advisory” for The HSUS that had nothing to do with financial metrics, governance, transparency, or the impact and effectiveness of our work to protect animals. The advisory came solely as a result of a legal settlement The HSUS and numerous other parties reached with the owner of Ringling Bros. circus. Charity Navigator’s donor advisory penalizes animal welfare organizations for advancing their mission through advocacy work and for defending themselves in court against scurrilous charges. The HSUS was never even a plaintiff in the case against Ringling Bros., and we essentially worked to protect ourselves from a lawsuit launched by a company with a history of Animal Welfare Act violations and of infiltrating and fighting animal welfare groups.  

For a decade, we got high marks from Charity Navigator, so it’s mystifying that the charity evaluator wouldn’t understand the threats constantly leveled against The HSUS by corporations that use and cause harm to animals. You can read our CEO’s blog on the settlement here.

Another group that gets it wrong is CharityWatch, or the American Institute of Philanthropy, which has an idiosyncratic perspective and a single-minded focus on particular financial measurements, strictly interpreting all direct mail, telemarketing, and solicitation costs as separate fundraising expenses. More sophisticated entities with more comprehensive standards, such as the Council of Better Business Bureaus, follow the example of Generally Accepted Accounting Principles, which allow appropriate allocation of direct mail costs between program and fundraising. The HSUS’s efficiency ratios exceed the standards of the Better Business Bureau Wise Giving Alliance, which requires that program expenses as a percentage of total expenses be 65 percent or greater; The HSUS’s ratio for program expenses as a percentage of total expenses for 2013 was 81 percent.

CharityWatch appears to frown upon aggressive member recruitment efforts conducted through direct marketing. The HSUS takes a different view because, while fundraising is a major component of mail or phone solicitations, there is a great deal more to these efforts than that. The HSUS direct marketing program builds a constituency of supporters and educates the organization’s members and the general public about important animal protection issues. It’s because of this large constituency and its influence that we can call on our supporters to take action, communicate with lawmakers or corporations on policy issues, raise awareness in their communities, and otherwise advance our programmatic goals.

Really, more than anything, we are about driving transformational change. Many of the charity groups evaluate spending ratios and governance, but there’s much more to the work of nonprofit organizations (as so many of these charity groups will tell you) than these ratios. A group can hit all of its marks on program spending ratios and good governance, but not get much done in the real world. The HSUS is driving change on the biggest animal issues of our time while adhering to the highest standards in the charity sector. We are second to no organization in effectiveness and reach of our programs. HSUS, Humane Society International, and the rest of our family of affiliated organizations are the number one provider of direct animal care and services, assisting more than 100,000 animals each year, and we are the number one advocacy group taking on the puppy mills, animal fighting rings, factory farms, wildlife trade, and other large-scale cruelties.

The best sources of information on the work of The HSUS include our website, our annual report, our Form 990, our videos, and the many publications and channels in which our work is featured. We encourage you to read and view them. You can see a list of our recent accomplishments online here, all of which our supporters have made possible. Please contact us with any questions, and we hope you will join our work.

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