So what is impact reporting?
If good evidence is hard to come by, then why is so much impact reporting being done, and how can it be better for the charity and the donor?
Rhodri and Matthew are of the view that charities are compiling impact reports because donors are asking for, and expect it, rather than because charities see the benefits of doing so. The consequences of this are several.
The first, according to Matthew, is that charities tend to view impact reporting as a way to secure more donations. This has led to the rise of ‘snake oil salesmanship’ and a proliferation of organisations claiming to measure your impact, when in fact they are sharing stories and short-term outcomes, without robust long-term evidence.
The second consequence, according to Rhodri, is that it is the donor and not the charity who is deciding the impact that a charity should have. Donors come to an organisation with a specific programme or idea in mind, and expect diligent reporting and results on that, when in fact it may not be in line with a charity’s mission, nor what they would choose to direct the money toward if given the choice.
Finally there is the question, if capturing and understanding the evidence is rarely done, what is recorded in impact reports and what are donors asking for?
Firstly, Caroline mentioned that, at the moment, it is very common for different funders supporting the same charity and the same project to ask for different impact reporting with different reporting requirements. This naturally places a big burden on charities.
Second, when we use the word impact in this context, if many charities do not have the evidence base to prove their impact, many funders do not have the expertise to know what good evidence looks like and what they should be asking for; most of what gets reported on are outputs.
Ultimately, there needs to be a more joined-up and efficient way of demonstrating impact and evidence building should not be to secure more donations. First and foremost, it should be about helping the charity understand the benefit of their work, if any, and how they can improve.
If donors have researched the evidence base for a charity’s work and feel confident in the long term benefits of that work before donating, then perhaps they will feel more confident in making unrestricted donations and attach fewer reporting requirements to the grant itself.