Innovations Post-Granting: Standardizing Reporting

This is our second of three posts focusing on grantmaking innovations post-granting. Earlier posts look at specific types of innovations before and during the grantmaking process. Our introduction to the series explains the importance of open grantmaking innovations and why they matter for improving the legitimacy and effectiveness of grant-based public investments.

Summary: In order to make open grantmaking data more useful, it is important to develop more uniform reporting standards for grantors and grantees alike.

There is a growing awareness that making sense of open grantmaking data (which we describe in a previous post) will also requires better, more uniform data-reporting standards, such as unique identifiers for specific grantors, grantees, and specific projects. Achieving anything close to a unified reporting standard is easier said than done, though work toward that goal has thankfully begun within both the public and philanthropic sectors.

In 2014, President Obama signed the DATA Act, which mandates that the federal government standardize the reporting of federal spending data. Although focused primarily on how contracting is reported, the statute provides the power for the White House Office of Management and Budget and Department of the Treasury to set standards that could also apply to grants.

On an international level, the Open Contracting Partnership is a global initiative working to secure international transparency commitments for all stages of government contracting. As an important component of its work, it has developed a standard to make published contracting data more uniform and usable. The Open Contracting Partnership is a compelling example of how, when data is released (as discussed in the previous post), and done so in a standardized fashion, there is the potential to avoid duplication of investment, decrease fraud and abuse, and enable better analysis of impact.

The public sector, though, generally lags behind the nonprofit sector in adopting data reporting standards for grants and evaluations. The International Aid Transparency Initiative (IATI), for instance, endeavors to systematize the reporting of aid and development spending data. As they describe it, “Organizations implement IATI by publishing their aid information in IATI’s agreed electronic format (XML) — usually on their website — before linking it to the IATI Registry. The Registry acts as an online catalogue and index of links to all of the raw data published to the IATI Standard.” This model may prove useful as governments work to set standards for their own grant reporting.

A further challenge to greater transparency about grant funding (as with contracts) is the absence of a common taxonomy for describing the underlying entities and organizations themselves. (To put it differently: it’s difficult to report on financial flows between agency A and organization B when there is no agreed-on way to name or describe agency A or organization B.) There is already underway an international, multi-stakeholder effort to establish legal-entity identifiers (LEIs) in the financial services sector. The BRIDGE project, funded by the Gates Foundation, is an acronym for Basic Registry of Identified Global Entities. BRIDGE aims to assign a unique ID to every NGO to make open data about grants more easily analyzable. A related effort called ORCID, which assigns unique identities to researchers, is similarly designed to ensure that data about grantmaking translates into improved understanding of downstream impact.

The sheer number of initiatives mentioned above makes clear that a critical mass of interest in data standardization exists. But coordinating among these various actors, and ensuring that they do not end up at cross purposes, will be crucial.

Why Do It:

• Signal, Not Noise: With standardizing reporting categories, grantors and third parties will have greater ability to compare activities, outputs, and impacts across different sorts of grants.
• Ease of Reporting: With pre-defined categories, there is less guesswork for grantees in knowing how to report to funders.

Why Not Do It:

• Stifling Creativity: Just as metrics cannot always be standardized, rigidly defining reporting categories can artificially constrain grantees and the activities they undertake.
• Compliance Burden: Box-ticking exercises take time and resources away from core activities.

Click here for the third post in our series on innovations post-granting, or head back to the table of contents for an at-a-glance look at the whole publication.