As was mentioned in my previous post, Israel’s OFFLINE Overhaul of its Nonprofit Sector (Guidestar Conference, Part 1), the June 26th Conference Organized by Guidestar Israel tantalized the attendants with many planned improvements within the government offices tasked with overseeing Isael’s nonprofit sector.

Even more monumental, though, are the changes that are taking place online.  Here we are seeing not only an upgrade in software, but in approach and analysis as well, whose rippling effects will be felt far beyond Israel’s shores.   

AN ONLINE TOOL FOR ISRAELI CHARITIES

Avi Shapira, CEO of NP Tech, the Public Benefit Company that develops and oversees Guidestar Israel and Techsoup Israel, stressed that his organization is aware of Guidestar’s important role in Israel’s nonprofit sector. Evidence of its increasingly crucial role, he said, is seen from the growing number of views of the site from abroad — even though the current version of Guidestar Israel is primarily available in Hebrew.

Shapira believes that Guidestar sits at a unique crossroads because it is a joint project between private and government entities. As such, he wishes that organizations would proactively use Guidestar as a Transparency tool. In this vein, Shapira believes that it is only natural that Guidestar should be the address to aggregate all available Government grants — a feature he believes will be integrated in approximately four months time. (Wow!)

Following up Mr. Shapira, was Benny Shlesinger, of NPTech, who is Guidestar Israel’s project manager. Benny opened that the new site can already be previewed at http://preview.guidestar.org.il.

ROBUST SEARCH FOR THE DONOR

The current site is available in English but only in a limited capacity. The new site, however, will exist in full in English and will incorporate English in its search functions, a feature that will allow international donors to more easily find organizations of interest. Additionally, increased search capabilities will also include the ability to search by organization type, a feature geared for the potential donor with a specific charitable goal in mind but is unaware of the players in that particular field.

In the new site, Shlesinger continued, nonprofits can add even more details to their profile, including links to their social media personalities on the various networks. (Links to donation portals already exist in the current version). This enhanced profile brings with it improved navigation and color designation to make it easier to discern if the information shown originates from certified Government sources or from the charity itself.

STREAMLINED DATA OUTPUT & TIMELIER ANALYSIS

Thanks to recent efforts to bring Israel’s nonprofit online, important data on Israel’s nonprofit sector is available faster than it was in the past.

Additionally, the available data incorporates internationally recognized definitions and categories (see pgs 18-22) to enable the data to be used beyond Israel’s borders, giving the local sector a better understanding of how it fares in the global market and vice versa.

Utilizing this shorter turnaround, Prof. Nisan Limor, Chairman of NP Tech and one of Israel’s leading researchers into its nonprofit sector, presented findings from 2010.

While not the focus of this article, it is interesting to note some of the points that Prof. Limor stressed:

The whole notion of tax-deductible status is very problematic in Israel. The data shows that only 4,280 out of Israel’s approximately 35 thousand charities actually have tax-deductible status, known here in Israel as Sei’f 46a status. Limor pointed out that no other OECD country has charities appealing to parliament to get tax-deductible status. (I shared my own opinions regarding Se’if 46 in a previous piece.)

Tracking “ownership” of nonprofits is still difficult if not impossible. There are invariably charities that are managed by local municipalities, making them extensions of local government and not really charities for the sake of sector analysis. Who these are and how many is very much a mystery.

With all the outcries against “high” salaries in Israel’s nonprofit sector, the numbers show that being a nonprofit manager is no sure ticket to riches. By law, each organization must list its five highest paid employees (assuming they even have five staff members). The average of the five highest paid employees across the entire sector amounts to 8,777 NIS a month, which Limor notes is Israel’s average monthly salary. Even the average of all highest paid employees only amounted to a monthly salary of 12,593 NIS — and all this is before taxes. (No wonder so many directors leave to enter the private sector.) Again, certainly not the point of this piece, but worthy to note.

TAKE-AWAYS FROM THE OFFLINE & ONLINE IMMENENT CHANGES

Both the global and local nonprofit sectors are changing and the word Transparency seems to be an integral part of this metamorphosis.

While it is true that most of points mentioned in the Guidestar-Israel articles are predictions for the future as opposed to hard analysis of the past — and we all know what happens when you “assume” — we should consider ourselves lucky that at last week’s conference the various Government oversight bodies were kind enough to specify the application of Transparency. The exact date these changes will come into effect is of less importance that the fact that they eventually will. Case in Point: Guidestar Israel took six years but did eventually get off the ground.

Israel charities should consider implementing soon the suggestions “offered” at the Guidestar Israel Conference in order to be among the leaders of this change instead of lagging behind.

Tizku Lemitzvot,

Shuey

In case you missed: Israel’s OFFLINE Overhaul of its Nonprofit Sector (Guidestar Conference, Part 1)

Disclaimer: This blog houses my personal opinions and is for informational purposes only — not advice. As charity laws can be quite complex and ever-changing, please refer all questions to qualified and licensed professionals. Read the full disclaimer.

The June 26th Conference Organized by Guidestar Israel — a collaborative project of the Justice Department, Registrar of Corporations, Guidestar International, NP Tech, Joint Distribution Committee (JDC), and Yad Hanadiv (a.k.a. The Rothchild Foundation) — was June’s best prediction for “The Tomorrow of Jewish Philanthropy.”

In the global nonprofit sector there is much talk of cooperation and the need to combine forces to increase efficiency and cut costs, yet this synergy is hard to find. Guidestar Israel, in contrast, is actually doing it. Local charities, international organizations, private funds and government resources have all cooperated to bring the Guidestar Israel project into fruition. (And yes, it took over six years for the parties agree and get things off the ground, but we’ll choose not to focus on that for right now.)

Like many conferences, there was the good and the less good, but for those paid attention, there was also the surprising — announcements foretelling actual progress.

THE SECTOR MUST POLICE ITSELF

Advocate Alon Bachar, Director of Israel’s Corporations Authority, which oversees the Registrar of Charities and the Registrar of Companies, was quick to declare that transparency is the foundation of Israel’s nonprofit sector. Scandals, he continued, harm the sector as a whole. Thus, he concluded – and this is where things got interesting – self interest dictates that the nonprofit sector should police itself. (It would appear from his words that he considers himself and the Government office he represents to be card-carrying members of Israel’s nonprofit sector.)

Furthermore, Bachar blames the local nonprofit sector’s lack of transparency for Israel’s lack-luster standing in philanthropy as compared to other modern countries. This is a bold statement considering other experts have pointed fingers at lax Government tax incentives as the root of the problem or Israeli charities overall lack of strategic engagement with their constituents (my personal belief, which I elaborated in a previous post, “The Real Reason Israelis Don’t Donate to Charity“).

Bachar didn’t leave much to the imagination for those that were looking to understand the criterion upon which the Registrar inspects nonprofits. Bachar stressed that organizations should pay close attention to the Nihul Takin, as it explains “our priorities and how we evaluate charities.”

INFRASTUCTURE CHANGES IN THE REGISTRAR OF CHARITIES

The part of his speech that had the most practical application was Bachar’s announcement that the Registrar of Charities is adding services to increase its own transparency. In the past, Bachar explained, Israeli charities essentially had five addresses within the Registrar of Charities — including accounting, legal, managerial and compliance — where they could address their problems, seek answers, or submit reports. Two years of analysis determined this method to be less than effective and a decision was made to revamp the entire system.

As part of the Registrar’s overhaul, multidisciplinary staffs will be created to combine the five different needs into one address. Instead of five addresses, each charity will be assigned a team that will handle any and all of their requests. Furthermore, this new type of team will allow the Registrar to further specialize its staffs by discipline — whether it be sports, education, welfare, health, environment, religious etc — to better cater to nuance, experience, and trends of the different types of causes.

In a similar vein, Bachar’s Deputy Director, Advocate Avital Shreiber, announced that charities will soon also be labeled by size.  Shreiber acknowledged the difficulty of smaller organizations — many of whom function with no paid staff — to adequately file the multitude of government initiated paperwork.  Much like a system that has existed in the United States for a few years, “smaller” organizations will face scaleddown reports.  Shreiber added that it is even conceivable for their to be specialized reporting for the different philanthropic disciplines.

Transparency, as Bachar defines it for the Registrar of Charities, is uploading information quicker so that it can be utilized in a timelier manner. Toward this end, he said, the Registrar is turning totally digital, with every form and appeal to be handled online. He also announced that the Nihul Takin will be updated soon and would probably only be released on the internet.

USE GUIDESTAR OR ELSE…

Bachar also encouraged amutot to take advantage of Guidestar Israel and upload as much information as possible — even more than is necessary — so as to increase transparency of the organization and the sector as a whole. While some might see this recommendation of Guidestar as mere self-promotion, it should be taken much more seriously considering these two statements:

Bachar’s claim that the Registrar of Charities will be increasing cooperation with various Government agencies, specifically the Tax Authority & Anti Money Laundering Compliance, so as to decrease overlap.

This declaration was preceded by statements from Dr. Guy Rotkopf, CEO of the Justice Ministry which overseas Bachar’s Registrar of Corporations, in which he boldly claimed that Israeli charities that choose not to participate in Guidestar Israel have something to hide.

Definitely hints of trends to come.

Tizku Lemitzvot,

Shuey

Don’t Miss the Next & Final Post in the Series: Israel’s ONLINE Overhaul of its Nonprofit Sector (Guidestar Conference, Part 2)

Disclaimer: This blog houses my personal opinions and is for informational purposes only — not advice. As charity laws can be quite complex and ever-changing, please refer all questions to qualified and licensed professionals. Read the full disclaimer.

A list of great articles from around the web that I posted to Twitter from May 16 – May 22, 2010.  This week’s topics include: Strategy & Governance; US Tax Tidbits; Social Media & Fundraising; Economy & Finance; and Potpourri.

Tizku Lemitzvot,

Shuey (@nonprofitbanker)

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Strategy & Governance

Guidestar CEO stresses that good metrics help nonprofits attract (strategic) deep-pocket donors http://ow.ly/1LFba #philanthropy

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US Tax Tidbits

RT @NAFund & @aznonprofits: 6 Important Facts about Tax-Exempt Organizations http://bit.ly/9n8Qcz // The ABCs of donating money to US NPOs

New online tax form for small US charities: Good. IRS deadline-extension of new form: Bad. http://ow.ly/1ODte via @philanthropy

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Social Media & Fundraising

6 Ways Board Members can fundraise w/out having them solicit peers, by @GailPerrync http://ow.ly/1LDdY via @npmaven @PamelaGrow

Engaging consumers about their social/environmental concerns? 75% believe you should (by @andrealearned) http://ow.ly/1NQkP via @elainecohen

Real-Life stories from nonprofits on incorporating social media into marketing strategy http://ow.ly/1OAyg via @nptechblogs @reedstockman

The mantra for all who work with social media >> The Cornerstone of Social Media Strategy is Clarity, by @askdebra http://ow.ly/1OD3d

Intro in “What the Hastag,” a wiki hash directory & metric analyzer, by @jewishagency http://bit.ly/bskHmx via @eJPhil

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Economy & Finance

Rethinking the metric of a good economy, maybe the G.D.P. isn’t the best judge. On @nytimes http://ow.ly/1LFvj

Haaretz: European crisis could cause #Israel exports to fall by $1 billion http://ow.ly/1LWi7

Haaretz: Why gold is spiking & why it matters to the Bank of #Israel http://ow.ly/1LWoM // Good summary of currency fluctuations & inflation

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Potpourri

ATM-style vending machine that dispenses GOLD! http://ow.ly/1LSTh Not to be confused with ATM-style vending machine that dispenses French Fries http://ow.ly/1LSXX

Who says Britons don’t have a sense of humor? >> RT @johnhaydon: Man loses licence after drunk driving in toy Barbie car http://ow.ly/1NQxP

A list of the essential articles I posted to Twitter from February 14 – February 20, 2010.  This week’s topics include: Nonprofit Strategy & Governance; Internet, Social Media & Fundraising; Jewish Nonprofits; Israel Economics; and Potpourri.

Tizku Lemitzvot [May you merit to continue doing good deeds],

Shuey

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Nonprofit Strategy & Governance

NPOs don’t operate in a vacuum. Orgs need to understand their context & plan accordingly, by @npmaven http://ow.ly/18rNJ via @AlisonRapping

RT @AlisonRapping: RT @BTalisman: Blog Post, “Snow Daze!? Nonprofit Disaster & Recovery Planning” http://ow.ly/16Aef4

ABC’s for Exempt Organizations: Links & summaries of info available on IRS website, by@charitylawyer http://ow.ly/17Nt6

->@3rdSect: 18 Traits of Successful Nonprofit & NGO Leaders (w/ lots of corresponding links) by@deatweets http://ow.ly/18BAo via@beyondbiz

->@AlisonRapping: Successful relationships btwn orgs depend on strong relationships within orgs http://ow.ly/19tFU via @socialchngediva

RT @religion_state: RT @askdebra Nonprofit Collaboration: Doesn’t It Make the Pie Bigger?http://bit.ly/dfFScq

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Internet, Social Media & Fundraising

Really tackles the essence of social media }} Fire your Director of Social Media! by@PaulDunay http://ow.ly/19tuI via@TEAMDJW @dmscott

On NPTimes: 5 Tips For Moving Donors To The Next Giving Level http://ow.ly/19udB

RT @johnhaydon: 10 Must Read Tips to Start a Small Business Blog http://ow.ly/182hj via @copyblogger // Universal Tips!!

Fundraising Event: Spread the word, publicize in advance & have fun. Tale of 2 Fundraisers by @danhutson http://ow.ly/18rs via @askdebra

5 Step Program to Measure Effectiveness of Your Web Pages, by @avinashkaushik (he wrote a book, so take him seriously) http://ow.ly/18B9X

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Jewish Nonprofits

Unable to avoid the internet, Jewish (observant) women turn to rabbis & profesionals for best practices. http://ow.ly/18Bmp via @carmelva

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Israel Economics

RT @Israel_News: Conservative nature of #Israel banks helped minimize the economic crisis in Israel. http://ow.ly/18bHT

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Potpourri

On @guidestarusa: Americans rely on Nonprofit Reviews to same extent as Consumer-Product Reviews http://ow.ly/1895U // Do you agree?

RT @TEAMDJW: Liodice: 10 Ideas That Changed the Marketing World http://adage.com/u/76Mhpb

-> @NYTimes: Wall St. helped European governments hide their mounting debts. When will we learn? http://ow.ly/17d4b

RT @arielbeery: Great list of books relevant to orgs today: http://ow.ly/17F15 // Definitely worth a peek, both classics & newbies

An article was recently posted on Midot’s website highlighting a joint study done by Midot and Sheatufim.   The study was presented at a Sheatufim conference on June 23, 2009.  The many findings of the study include:

• Israeli philanthropic foundations are investing great resources in the grant process and in grant selection before the transferring of funds to nonprofits; however, most foundations lack clear criteria that accompany the process and rely only on the reports from the recipients themselves.
• Even though the processes of the different foundations are similar, there exists little cooperation between the various foundations.
• Most foundations do not rely on external professionals to help check the recipients’ usage of the grants.
• Most foundations do not implement a suitable analysis before the donation is given.
• Foundations reported a lack of evaluation and measurement tools to check recipient organizations.  Foundations also noted a lack of tools to help analyze the financial statements of the organizations.

In response to the report, the article quoted Shlomo Dushi, Sheatufim’s CEO:

“During a period of a world financial crisis, the purpose of philanthropic foundations  is critical as they can provide much needed oxygen to organizations.  There is a need to formulate a shared tool that will provide an answer to the needs of  the foundation so that it can invest its grants in an effective manner.”

Recommendations of the Study:

1. To create a shared tool that foundations can use to evaluate nonprofit organizations.
2. To request help and advice from external professionals in the field when reviewing charities.
3. To define clear criteria to analyze nonprofits.
4. To work in cooperation [shituf pe’ulah] between the various foundations.

Personally, I wonder if item #4 will actually help foundations analyze their recipients better or if it will just lead to a Big Brother syndrome, with all foundations sharing information to the detriment of the nonprofit organizations.  Jury is still out with this question.  Any thoughts?

Tizku LeMitzvot [May you continue to merit doing good deeds],

Shuey

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Some Background Information:

• Midot is an Israeli version of Charity Navigator.  The biggest glaring difference is that while Charity Navigator grades charities based only on their financials, Midot analyzes many different aspects, such as board participation and target audience.  Midot was founded by Meitav Investment House and the JDC.
• Sheatufim is an organization whose goals boil down to making nonprofits function better.  Contact Sheatufim to see if your charity can qualify for their programs.  The organization was founded by Zionism 2000,  the Rashi Foundation, the JDC, and the Gandyr Foundation.   For a full list of their partners and cooperating organizations, click here for Hebrew and here for English.

The website “Zavit Shalosh” [The Third Perspective] posted on their site yesterday (in Hebrew) that Guidestar has officially come to Israel.  Currently, the Guidestar site is in its pilot stage and is inviting Israeli amutot [nonprofits] to participate.

For those that are unfamiliar, Guidestar markets itself as providing “trusted nonprofit information” so interested parties can make “informed decisions” (quotes from the Guidestar site).  The Guidestar website does this by posting organizations’ financial documents.  For United States charities this means that the site posts the IRS’s 990 form — going back to about 2005 for some organizations.  (To date, Guidestar has had the financials for every organization that I have searched for.)   Started in the United States, Guidestar has been slowly entering additional international nonprofit markets.

For those of us working in Israel, finding information about amutot [Israeli nonprofits] can be a real pain.   The only place that has the information is the Rasham Ha’amutot [Registrar of Charities] and you need to go there in-person to get the information.  Currently, the Registrar is scanning its files so some of the files you need might not even be there (call in advance to find out).

Zavit Shalosh writes that in addition to Guidestar posting documents from the Rasham, the site will also allow organizations to upload information to their charity bio on the site.  This feature will allow viewers to get a richer understanding of the organization beyond whatever documents might appear on the site.  (The Guidestar USA site has recently undergone a heavy upgrade to also allow this possibility.)

Guidestar is planning to launch the site with 50 amutot for its trial period. Each participating organization will be able to view their financials and add details — before the site is open to the public.  Sessions will be held with each of the organization to teach them about the site and its tools.

The site is being launched in conjunction with the Israeli Ministry of Justice, JDC Israel (Joint), and Yad Hanadiv (Rothchild Foundation) — big names indeed.  A link to the press release can be found here.

Interested nonprofit organizations can email pilot@guidestar.org.ilor call 077-540-2923.  A form is also available on the Guidestar Site.  To read the original Hebrew article posted on Zavit Shalosh, click here.

In an age when the power of the web is proving to be an invaluable tool in free marketing and donor research, joining the Guidestar site can be a real benefit to a nonprofit.

Tizku LeMitzvot [May you continue to merit doing good deeds],

Shuey