Monday, January 12, 2009

Finally! An SROI Calculation for Funding Advocacy

Finally! Some hard numbers showing how support for nonprofit advocacy can and does lead to results that leverage funders' investments in ways they may have never imagined.

Those of us who have been bleating about how this for years -- and who see it as a fairly obvious way to get more bang for the buck -- have continually been frustrated by the lack of concrete data showing a clear return on investment, which funders need, and understandably want, if they're going to fund it.

And now we have some, thanks to a study just released by the National Center for Responsive Philanthropy: Strengthening Democracy, Increasing Opportunities.

NCRP studied 14 organizations that work with underrepresented constituencies in New Mexico to advocate on a range of issues over a five-year period and found that the total dollar amount of benefits accruing to the groups’ constituencies and the broader public was more than $2.6 billion. For every dollar invested in the 14 groups for advocacy ($16.6 million total), the groups received more than $157 in benefits for New Mexico communities.

Funding for a collaborative advocacy effort to raise the minimum wage in New Mexico also led to an additional $250 million for low-income workers in the state. A partnership among advocacy groups helped pass the 2003 Home Loan Protection Act, an anti-predatory lending package that has helped New Mexico keep foreclosure rates lower than many other states. And nonprofits and state agencies worked together to created a trust fund to provide permanent funding for affordable housing in New Mexico.

The good news is that the study will be replicated in another state, North Carolina. Working with local partners, which are likely to include the N.C. Center for Nonprofits and the North Carolina Network of Grantmakers, the National Committee for Responsive Philanthropy aims to identify 15 nonprofits in the state to participate in the study, says Ranghelli, senior research associate for the national group. The report, which likely would be released next spring, would quantify advocacy funding by foundations for those nonprofits over five years, identify those nonprofits' advocacy activities and quantify their impact.

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