America's 200 Largest Charities
William P. Barrett 11.21.07, 3:00 PM ET
Here's our big suggestion to those brimming with holiday charitable spirit: Treat any would-be donation like you would an investment. After all, as a supporter, you become a stakeholder. Do your research and learn all you can.
Toward that goal, we present here our annual list of the country's 200 largest nonprofits--just a slice, albeit a very hefty one, of the more than 1 million nonprofits now operating in the U.S.
As might be expected from a business publication, we closely examine the financial efficiency of each organization. These numbers can tell you a lot, but are by no means the entire story; there are a lot of other factors to consider. So our list doesn't relieve you from doing your own due diligence--although it can give you a start.
By The Numbers: The Largest U.S. Charities
During the last year, the charities on this list reported average gifts of $203 million, up 2.5% from the previous period. That was slightly more than the 2.1% jump in top pay (usually that of the nonprofit's top person) to $496,965. Gifts continued to comprise about 40% of a nonprofit's total revenue.
We determine the country's largest nonprofits on the basis of private gifts (not total revenues) reported in the latest available fiscal year. Among other criteria, the list excludes academic institutions (who generally solicit only among alumni, but are usually fairly efficient), charities with only a few donors (such as most private foundations and, say, Ted Turner's United Nations Association), community foundations, religious entities that don't report numbers and outfits whose data we question. We have classified each within 10 broad categories, such as domestic social needs, public affairs and youth.
For each nonprofit, we present a considerable amount of basic raw data, as well as a link to its website, where, often, annual reports and detailed financial statements can be found. In addition, we calculate three major efficiency ratios and the trend from a previously reported period. The higher, the better. Here's a description of these statistics:
Charitable Commitment: This measures how much of total expense went directly to the charitable purpose (also known as program support) as opposed to management, certain overhead and fundraising. The average this year is 85%, down 1%. The individual figures range from a bottom of 0% for Nevada Cancer Institute, 32% for World Trade Center Memorial Foundation and 63% for San Francisco public TV station KQED to 100% for three: Brother's Brother Foundation, Gifts in Kind International and Gleaning for the World.
Fundraising Efficiency: Perhaps the most closely watched statistic, this shows the cut of gifts left after subtracting the cost of getting them. The average this year: unchanged at 90%. We recommend a cold, hard look at anyone with an efficiency below 70%. The bottom of our list holds the same three as last year: Veterans of Foreign Wars of the U.S., at 65%, Paralyzed Veterans of American at 66%, and KQED at 68%. At the top end, 16 nonprofits have a 100% fundraising efficiency, often thanks to larger gifts. This group includes Brother's Brother Foundation, Direct Relief International and Public Broadcasting System.
Donor Dependency: The trickiest, and, thanks largely to investment performance, most volatile of our ratios, this measures how badly a nonprofit needs your contribution to break even. We subtract the annual surplus or deficit from gifts, then divide this figure by the gifts. Reflecting a slightly improving stock market (remember, the data is often lagged by a year or more), the average this year was 68%, down 1%. The higher the percentage, the more the charity—well, needed the charity. A result above 100% means the nonprofit ran a deficit. Tops this year was Robert W. Woodruff Arts Center in Atlanta at 129%, followed by Project Orbis International at 120% and Heart to Heart International at 116%. A negative number means the nonprofit's surplus actually was bigger than total gifts. Fourteen nonprofits, mainly hospitals and museums collecting fees for service, were at this extreme, led by the Children's Hospital of Philadelphia, at -413%.
We again warn against mindlessly comparing ratios of different kinds of nonprofits, as each has a certain degree of uniqueness. But our data certainly can be helpful in the early stages of an evaluation of any nonprofit--on our list or not. Say you're interested in contributing to a smaller agency that helps the needy overseas. The ratios of several similar larger ones on our list can provide a sense of the norms for such enterprises.