How do we rate charities?

We believe our ratings dramatically improve the quantity and quality of information available to donors.

Our ratings provide clear, objective, and reliable assessments of financial health, accountability and transparency and accessibility of charities. By utilising Charity Clarity, donors can learn how a charity compares on these metrics with other charities throughout the sector.

As we continuously improve our charity ratings, we align our rating scales to the industry standards we see from reviewing charities. This table shows how we display our Overall Ratings.

Charity Overall ratings

These Overall Ratings of Charities are made up of several metrics which obtain individual ratings, based on the following criteria.

Numerical RatingQualitative RatingDescription
Five starExcellentExceeds sector standards and outperforms most charities for this metric.
4 starGoodMeets sector standards and performs better than most charities for this metric.
Three starAverageNearly meets sector standards and performs as well as most charities for this metric.
2 starNeeds ImprovementFails to meet sector standards and performs below most charities for this metric.
One StarPoorPerforms far below sector standards and below nearly all charities for this metric.

Our rating methodology is very much inspired by this TED talk by Dan Pallotta.

Detailed ratings for metrics

The following table outlines how we measure the individual metrics for the Financial Health category.

CategoryMetricDescription Rating-0           1            2    34                 5
Financial HealthLate in Submitting AccountsAverage number of days over last 5 years*More than 73 daysMore than 50 and less than or equal to 73 daysMore than 25 and less than or equal to 50 daysMore than 5 and less than or equal to 25 daysMore than 0 and less than or equal to 5 days0 days
Financial Health Working CapitalFor General including Religious ActivitiesFor Schools and High Trading Income Organisations

For Makes Grants to Individuals and Organisations

Working Capital  / Latest Year’s Total Expenses

Less than minus 1—

Less than 0.5

Less than 1

More than or equal to minus 1 but less than 0.2—

More than or equal to 0.5 but less than 1

More than or equal to 1 but less than 2

 

More than or equal to 0.2 but less than 1—

More than or equal to 1 but less than 2

More than or equal to 2 but less than 3

 More than or equal to 1 but less than 2—

More than or equal to 2 but less than 3

More than or equal to 3 but less than 5

More than or equal to 2 but less than 5—

More than or equal to 3 but less than 6

More than or equal to 5 but less than 8

More than or equal to 5—

More than or equal to 6

More than or equal to 8

Financial Health Expense Growth(Total Expenditure for latest year – Total Expenditure for 3rd Latest Year)/Total Expenditure for 3rd Latest Year**More than 100%More than 50% and less than or equal to 100%More than 25% and less than or equal to 50% More than 0% and less than or equal to 25%More than minus 30% and less than or equal to 0%Less than or equal to minus 30%
Financial HealthTotal Net Expenditure / Total IncomeFor Makes Grants to Individuals and Organisations
(Total Expenditure – Grants Made) for Latest 3 Years / Total Income for Latest 3 Years—For all others Administrative Expenditure for Latest 3 Years / Total Income for Latest 3 Years
More than 90%More than 75% and less than or equal to 90%More than 50% and less than or equal to 75% More than 1/3 (i.e. one-third) and less than or equal to 50%More than 20% and less than or equal to 1/3 (i.e. one third)Less than or equal to 20%
Financial Health Employees over 3 year average incomeNumber of Employees/3 Year Average Income * 1,000,000More than 10More than 5 but less than or equal to 10More than 2 but less than or equal to 5 More than 1 but less than or equal to 2More than 0.5 but less than or equal to 1Less than or equal to 0.5

*Current year figure taken at time of calculation. ** Adjusted according to years’ data available.

The following table outlines how we measure the individual metrics for the Accountability and Transparency category.

CategoryMetricDescriptionRating – 012345
Accountability and TransparencyClarity over Trusteeship ProcessInterpretation of information taken from published documentsUnavailable in documentation.Process, length and associated details unclear from documentation.Process, length and associated details somewhat unclear from documentation.Process, length and associated details maintain a basic level of clarity.Process, length and associated details largely clear from documentation.Process, length and associated details clear from documentation.
Accountability and TransparencyNumber of TrusteesNumber of Trustees**More than 15 trustees
OR
1-2 trustees
12-15 trustees10-11 trustees8-9 trustees6-7 trustees3-5 trustees
Accountability and TransparencyFemale Representation(Number of Women as Trustees or in Senior Management)/(Number of Trustees + Senior Management)0%More than 0% but less than or equal to 10%More than 10% but less than or equal to 20%More than 20% but less than or equal to 30%More than 30% but less than or equal to 45%More than 45%
Accountability and Transparency
Number of Additional Boards the Trustees Serve On(Total Additional Boards Served on by all Trustees)/Number of TrusteesZero
OR
More than 1
More than 0 but less than or equal to 0.1
OR
More than 0.9 but less than or equal 1
More than 0.1 but less than or equal to 0.2
OR
0.8 but less than or equal to 0.9
More than 0.2 but less than or equal to 0.3
OR
0.7 but less than or equal to 0.8
More than 0.3 but less than or equal to 0.4
OR
0.6 but less than or equal to 0.7
More than 0.4 and less than 0.6
Accountability and TransparencySocial Impact ReportingExtent to which social impact is measured and reportedNo social impact measurement or reportingVery little social impact measurement and reportingSome social impact measurement and reportingSocial impact measurement and reporting available but incompleteSocial impact measurement and reporting largely availableExcellent and comprehensive social impact measurement and reporting
Accountability and TransparencyPublic RelationsAssessment of public relations and communicationsMultiple issues which significantly negatively impact upon public perceptionSome issues which negatively impact upon public perceptionAfew small issues which negatively impact upon public perceptionNo issues either positive or negativeLargely positive stories which positively impact upon public perceptionSystematic and regular evidence of significant positive public perception
Accountability and TransparencyRevenue from Trading ActivitiesTrading Revenue/Income0%More than 0% but less than or equal to 2%More than 2% but less than or equal to 5%More than 5% but less than or equal to 20%More than 20% but less than or equal to 60%More than 60%

**Director, instead of Trustee, where relevant. ***Unless charity objectives require all-female team.

The following table outlines how we measure the individual metrics for the Accessibility category.

CategoryMetricDescriptionRating – 01     2345
AccessibilityContact Details AvailableAssessment of how easily relevant phone, email, other contact details are available publiclyNo relevant information availableVery little relevant information availableSome relevant information availableInformation available but partly incompleteInformation is largely availableWell maintained, high quality and easily accessible information available
Accessibility Clear and Accessible InformationAssessment of how easily available information is publiclyNo information easily availableVery little information easily availableSome information easily availableInformation easily available but partly incompleteInformation is largely availableWell maintained, high quality and easily accessible information available
AccessibilityRecently UpdatedAssessment of how recent the publicly available information isNo recent information availableVery little recent information availableLargely irrelevant recent information availableRecent information available but partly incompleteRecent information largely availableWell maintained, high quality and easily accessible information available
AccessibilitySentiment AnalysisSentiment Analysis uses natural language processing, text analysis and computational linguistics to identify and extract subjective information from the internet. Currently, we track positive, negative and neutral Facebook and Twitter presence and standardise it on a continuous rating scale of 0-5.
AccessibilityGoogle PageRankGoogle PageRank number on a scale of 1-10012345 or above
AccessibilityVision and StrategyAssessment of availability and efficacy of news and press information publiclyNo relevant information availableVery little information availableLargely irrelevant information availableRelevant information available but partly incompleteRelevant information largely availableWell maintained, high quality and easily accessible information available