Three of the nation’s leaders in not-for-profit information, GuideStarCharity Navigator and BBB Wise Giving Alliance, have joined forces to launch a campaign initiative to dispel the widely held “Overhead Myth”. The Overhead Myth is a common misconception that the percentage of charity’s expenses that goes towards administrative and fundraising costs–also known as “overhead”–is an appropriate metric to use when evaluating a not-for-profit’s worthiness and efficiency.

In an open letter to the donors of America, it strongly denounces the “overhead ratio” as a valid indicator of not-for-profit performance and states that it is the wrong measure to consider when determining if the not-for-profit is efficient or effective. The letter goes on to say that “when we focus solely or predominantly on overhead…we starve charities of the freedom they need to best help the people and communities they are trying to serve.”

The letter appeals for donors to pay attention to more relevant factors of not-for-profit performance such as transparency, governance, leadership and results.

Join MCB in spreading the word about this important topic. A website has been set up solely dedicated to the “Overhead Myth” campaign which you can visit at www.overheadmyth.comPlease consider publicaly committing to end the focus on overhead by signing the pledge.

Click on the below links to learn more about how you can get involved:

Share This
X