The Education and Research Foundation of The Better Business Bureau of Metropolitan New York, Inc.

30 East 33rd Street, New York, NY 10016, 212-533-7500

www.newyork.bbb.org and www.ny.give.org

Annual Report 2011 - 2012

As of April 2013

Promoting charity effectiveness Building ethical business skills

Recognizing high charity standards Providing education on key issues

Metro New York’s Better Business Bureau® Foundation

In 1967, The Education and Research Foundation of the Better Business

Bureau of Metropolitan New York (BBB Foundation) was incorporated as a 501(c)(3) nonprofit organization with an independent board of directors. The BBB Foundation collaborates with Metro New York’s BBB to create, fund, and implement special educational programs and investigative projects on consumer and philanthropic issues.

_________________________________________________________________________ BBB Foundation Core Program: NYPAS New York Philanthropic Advisory Service (NYPAS)

NYPAS is the core program of the Education and Research Foundation of the Better Business Bureau of Metropolitan New York. BBB Foundation promotes accountability for local charities, helps establish confidence in the sector, and encourages charitable giving in New York. It achieves these goals by producing and publishing reliable and easy-to-read reviews of specific charities, informing the public about wise giving practices, urging potential donors to give generously, and helping charities to meet and maintain high ethical standards. NYPAS charity accountability activities are substantially funded through the generous support of BBB Accredited Businesses, as well as by the BBB Accredited Charity Seal program.

NYPAS was launched in 1987, and a second, Long Island-focused charity review program began in 1995. These two programs were merged at the close of 2000, making NYPAS one of the largest local BBB charity review programs in the country. Each year, BBB Foundation program staff members review hundreds of financial statements, tax filings, annual reports, solicitations, direct mail pieces, and benefit information from charities all over southern New York State. Based on this information, it is determined whether a charity meets the 20 BBB Standards for Charity Accountability. BBB Foundation then produces a report with our determination and a summary of the charity's mission, activities, governance, and key financial information. Summaries of these reports are available online at www.ny.give.org, www.newyork.bbb.org and www.bbb.org; by phone; or through the mail. BBB Foundation’s NYPAS program also monitors issues affecting the local nonprofit community and provides public education on charitable management and philanthropic issues through events, alerts, media interviews, speaking engagements and active participation in industry forums. Media, trade groups, and other nonprofits regularly consult BBB as an expert on charity accountability issues.

BBB/Baruch Research Study: 2011-2012 Follow-Up Research In 2006, the BBB Foundation partnered with Professors Greg Chen and Frederick Lane from the Baruch College School of Public Affairs to evaluate data collected from charities the BBB Foundation had reviewed at that time. Subsequently, Professor Chen wrote his academic paper, “Does Meeting Standards Affect Charitable Giving? An Empirical Study of New York Metropolitan Charities.” Dr. Chen’s paper was published in the professional academic research journal Nonprofit Management & Leadership, Vol. 19, No. 3, Spring 2009. In his abstract for the paper, Professor Chen wrote:

Meeting BBB standards is associated with higher levels of public support. Participating in assessment programs and striving to meet the standards are recommended for nonprofits attempting to improve funding through charitable contributions. Further study that extends the search for the mechanism that links meeting standards to improved donations is recommended.

The BBB Foundation is happy to provide a complete copy of Professor Greg Chen’s 2009 paper upon request. In 2011-2013, the BBB Foundation collaborated with the BBB Wise Giving Alliance to commission another academic study of BBB charity review data from both organizations, covering a wider group of charities and a longer time period, to obtain a better understanding of the value of BBB Standards for Charity Accountability. Professor Chen began the research process in 2011. The study continued through 2012 and was concluded early in 2013. We expect that Professor Chen’s report will be issued on the study results in the near future. Informational Meetings for Charities and Grantmakers Charity Outreach: BBB Standards and Charity Effectiveness

In September 2002, the updated BBB Wise Giving Alliance Standards for

Charity Accountability were ratified at the national level and in November 2002 were ratified for the southern New York State area covered by the BBB’s New York Philanthropic Advisory Service (NYPAS). NYPAS released the final version in March 2003 to New York area charities. The new standards were introduced on a rolling basis with the last standard implemented in March 2006.

In early 2003, NYPAS began outreach efforts to help Metro New York area

charities understand and meet the updated BBB Standards, especially new standards about charity effectiveness self-assessment. These efforts continued in 2012 at an enhanced level and are ongoing in 2013.

In 2012, we were deeply grateful to have the support of American Express, EmblemHealth, The New York Community Trust, and United Way of New York City as generous overall co-sponsors of our sixth Charity Effectiveness Symposium and related efforts. Venable LLP also generously sponsored two follow-up workshop programs for charities about legal issues.

2012 Charity Outreach Programs BBB Charity Effectiveness Program Series

• BBB Charity Effectiveness Symposium VI, February 28, 2012: The BBB Foundation’s sixth Charity Effectiveness Symposium, entitled Thinking Out of the Box: Meeting Challenges with Creative Leadership, was presented in collaboration with Baruch College School of Public Affairs, with the assistance of Philanthropy New York, the essential input of our Program Committee members, and attendance promotion help from many other nonprofit organizations. There were 357 event registrants, the most ever, including speakers and staff. On the event day, counting both logged in attendees and badges taken by participants in the early morning rush, we estimate attendance by 270 participants, up from 250 in the prior year - including charity executives, philanthropic leaders, consultants, staff, and other interested parties.

• Workshop, March 20, 2012: With sponsorship from Venable LLP, the BBB Foundation presented All about UBIT: What Nonprofit Leaders Need to Know. This workshop provided legal information about tax implications for charity leaders seeking non-donation income from business activities. Presenters were Jeffrey S. Tenenbaum, Lisa M. Hix and Matthew T. Journy of Venable LLP. The program was hosted by Popular Community Bank, which donated space and refreshments, and the Support Center for Nonprofit Management and United Way of New York City were Event Supporters. The program drew a “sold out” group of 97 registrants, with 72 attendees logged as present on program day.

• Workshop, September 20, 2012: With further sponsorship support from

Venable LLP, the BBB Foundation presented Payroll Pitfalls: What Nonprofit Leaders Need to Know. This program provided legal basics about how nonprofit leaders can avoid common wage and hour pitfalls on issues such as FLSA exemptions, unpaid interns, independent contractors, volunteers, and more. Presenters were Jeffrey S. Tenenbaum, Megan H. Mann, and Nicholas M. Reiter of Venable LLP. This second near-capacity event was also hosted by Popular Community Bank, which provided space and refreshments. Event Supporters included the Association of Fundraising Professionals, New York City Chapter, New York Society of Association Professionals and United Way of New York City. There were 73 registrants; on the event day we checked in 61 attendees, including speakers and staff.

• Website Update; Email Promoting 2012 Symposium Film &

Whitepaper Distributed November 14, 2012; Press Release Issued November 15, 2012: The “Learn About Charity Effectiveness” website at www.newyork.bbb.org/charityeffectiveness has been completely re-organized and re-posted with new graphics, including links to films of the 2012 program and whitepaper summary, as well as links to films and summaries of prior Symposium events, plus selected resources related to charity effectiveness issues. We promoted this revamped resource in an email to our charity lists on November 14, and a press release issued November 15, 2012.

BBB Charity Standards Briefings In 2012, we continued our series of no-cost briefings about the BBB Standards for Charity Accountability. These programs are presented to groups of 2 to 25 nonprofit leaders, board members, and consultants, usually in the BBB’s own conference room. When invited to do so, we will also present programs at no-cost for audiences recruited by other organizations. There were 6 such briefings in 2012, with 76 attendees; one of them was conducted for the FMA Institute at Fiscal Management Associates, and another was conducted at Bridgespan for their CFO group. Additional briefings are taking place in 2013. BBB staff provides a “deep dive” into understanding the Standards, guidance about how to meet each one, and additional related information. Charity leaders are encouraged to ask questions and provide feedback about the Standards at such programs. Interesting questions and insights from attendees are provided to the national BBB Wise Giving Alliance for consideration.

Attendees at a February 2012 BBB Charity Standards Briefing. Luana Lewis, Senior Vice President-Programs & Services, and NYPAS Program Manager Peter Espinoza share information about the ChartingImpact.org charity effectiveness reporting tool.

2012 BBB Charity Standards Briefings January 25, 2012 Briefing - at Bridgespan CFO Group (25 attendees)

February 14, 2012 Briefing - at BBB in NYC (15 attendees)

April 25, 2012 Briefing - at BBB in Westchester (2 attendees)

July 25, 2012 Briefing - at BBB in NYC (8 attendees)

August 23, 2012 Briefing - at BBB in NYC (13 attendees)

December 5, 2012 Briefing - at FMA (13 attendees)

Charity Symposium VI - February 28, 2012 Thinking Out of the Box: Meeting Challenges with Creative Leadership Generously supported by American Express, EmblemHealth, The New York Community Trust and United Way of New York City. On February 28, 2012, the Metro New York BBB Foundation presented its sixth Charity Effectiveness Symposium, entitled Thinking Out of the Box: Meeting Challenges with Creative Leadership. We estimate that approximately 270 nonprofit and foundation leaders, as well as philanthropy advisers, consultants, and staff were present at Baruch College for this event.

L: Keynote Speaker Maria Mottola, Executive Director of the New York Foundation, shares her ideas about “The Art of Thinking Big” with Symposium VI attendees. Here she asked: What is expected? What is possible?

R: Attendees filled the plenary hall during the Symposium. Maria Mottola kicked off the morning by sharing insights about how creative nonprofit leaders can make an impact – even with very slender resources - drawn from her extensive experience in nonprofit and foundation management. Ms. Mottola’s New York Foundation is known for supporting grassroots-level organizations that use community organizing and advocacy tactics to pursue systems change.

BBB President Claire Rosenzweig, at far left, talks with discussants in the Meeting Challenges with Creativity: Views from Innovators panel. L to R: Moderator Timothy J. McClimon, President, American Express Foundation; plus panelists Paula L. Gavin, President, National Urban Fellows; David Garza, Executive Director, Henry Street Settlement; and Evie Hantzopoulos, Executive Director, Global Kids.

Following the Keynote presentation, Timothy J. McClimon, President of the

American Express Foundation, moderated a panel entitled Meeting Challenges with Creativity: Views from Innovators. The panel included leaders who discussed a wide range of creative leadership responses to the difficult operating environment, ranging from strategic planning to engaging staff and constituents in advancing the mission. They were David Garza, Executive Director of Henry Street Settlement; Paula Gavin, then President of National Urban Fellows; and Evie Hantzopoulos, Executive Director of GlobalKids. Next, Jason R. Lilien, Bureau Chief of the New York State Attorney General’s Charities Bureau, provided a complete update on the report recently issued by the New York Attorney General’s Leadership Committee for Nonprofit Revitalization. Mr. Lilien also highlighted two new programs: New York on Board, and Directors U, which are intended to help nonprofit board members exercise their governance responsibilities as effectively as possible.

Hilda Polanco, Founder and Managing Director of Fiscal Management Associates, LLC, moderated the final panel, entitled Managing Great Performance: Differentiating Your Organization Through Stellar Planning and Evaluation. The panelists were Sister Paulette LoMonaco, Executive Director of Good Shepherd Services; Megan McAllister, Program Officer of the Altman Foundation, and Peter York, who is Senior Partner and Chief Research and Learning Officer at TCC Group.

Two workshops were held as a follow-up to the 2012 Symposium. We presented All about UBIT on March 20, 2012. This popular special workshop was sponsored by Venable LLP, and hosted by Popular Community Bank which donated space and refreshments.

Payroll Pitfalls was presented on September 20, 2012, with expert speakers

and sponsorship from Venable LLP. Popular Community Bank hosted the event in its space and provided refreshments.

On November 14, 2012, we issued an email announcement with broad distribution to charities, providing the Symposium whitepaper summary, and links to online films of all Symposium proceedings.

Hilda H. Polanco, CPA, CCSA, Founder and Managing Director, Fiscal Management Associates, LLC, at far left, moderated the panel Managing Great Performance: Differentiating Your Organization Through Stellar Planning and Evaluation. Panelists from L to R: Sister Paulette LoMonaco, Executive Director, Good Shepherd Services; Megan McAllister, Program Officer, Altman Foundation; and Peter York, Senior Partner and Chief Research and Learning Officer, TCC Group.

The Learn About Charity Effectiveness website resource at www.newyork.bbb.org/charityeffectiveness, which is the permanent online home of BBB Charity Symposia films and whitepaper summaries, was updated in 2012 and re-launched in November of that year.

Symposium Attendee Evaluation Summary Out of 357 registrants, based on check-ins and badges taken by some latecomer attendees, we estimate that 270 participated as attendees at the Symposium, including speakers and staff. A total of 120 individuals completed and returned evaluation surveys in 2012 – an increase of 49% above the 85 who did so in 2011 – representing about 47% of 254 non-staff registrants, far above last year’s 36% return of surveys.

• About 95% of Symposium respondents said they would use information from the program in their work, in some way, comparable to 94% last year: 114 out of 120 said they would use program information (95%); three persons (2.5%) indicated “no”, the program information would not be used, although several of them rated specific program elements highly; an additional 3 people did not check yes or no to this question, although one of these three added comments about intentions to use collaborations and skill sets in work.

A screenshot of the November 14, 2012 announcement email, which made video clips and the whitepaper summary of the 2012 Symposium proceedings widely available to charities, press, and other interested parties.

• A total of 99 out of 120 respondents, or 82.5% (somewhat less than 90.6% last year), said the program met their expectations in some way: 98 of 120 respondents or 81.7% said they learned what they expected to learn from the Symposium, while one replied “somewhat”. Eight persons (6.7%) said “no” - the program was not what was expected: but their comments diverged widely. For example, several felt the program was not as expected but found it interesting and informative, while others were looking for a different kind of conversation about innovative thinking.

Attendees gave high marks to all of the program segments this year; all were rated above 8 out of 10, averaging 8.33 across all program segments, with 10 being highest.

In 2012, the Symposium audience once again included a rather senior group of executives. As usual many attendees said they perform fundraising roles (33 out of 120 respondents, or 27.5%, down from last year’s percentage of 43.5%, but similar in absolute numbers). There were also many CEOs (19 or 15.8%) and trustees (19 or 15.8%). There were more consultants (23 or 19.1%), as well as more planning/evaluation executives (20 or 16.7%) and administrative staff (19 or 15.8%). Attendees also included training executives (10 or 8.3%), operations and financial officers (7 or 5.8% for each), foundation executives and external or public affairs officers (6 or 5% for each), students (5 or 4.1%), professors (2 or 1.7%), and “other” including no responses (12 or 10%), which included disciplines such as HR, IT, and board leadership. Respondents were encouraged to list multiple roles so numbers and percentages do not add up to 100%.

Follow-Up Programs: Attendee Evaluation Summary All about UBIT: What Nonprofit Leaders Need to Know was presented on March 20, 2012, with expert speakers and sponsorship from Venable LLP. We logged in 72 attendees out of 97 registrants on the “sold out” event day, of which 3 were speakers, 9 were staff and 60 were registrants. Of these attendees, 27 returned completed workshop evaluation forms (45%). The Venable speakers discussed what types of income do and do not count as “UBI” or unrelated business income with potential tax consequences. Exceptions such as sponsorship, licensing and royalty income were covered, and the presenters also talked about cause marketing income issues.

Workshop ratings were given by 25 of 27 respondents. The two non-raters indicated they had attended to get specific information related to the program topics. This workshop’s rating average was a very high 8.72%.

Comments from most attendees indicated that the program met expectations in some way: 22 out of 27 (81.5%) respondents said “yes”, they learned what they expected to learn, and a further two individuals (including one who missed half the program) indicated that the program somewhat met expectations. One person who answered “no” was hoping for very specific UBIT information about investments. Two persons did not answer. Text replies indicated that while some found the program very valuable and comprehensible, for a few people it was too technical and more detailed than they expected.

Payroll Pitfalls: What Nonprofit Leaders Need to Know was presented on September 20, 2012 with expert speakers and sponsorship from Venable LLP. Popular Community Bank hosted the event in its space and provided refreshments. Thanks to the help of three Event Supporters - the Association of Fundraising Professionals, New York City Chapter, New York Society of Association Professionals and United Way of New York City - this program was also booked to near capacity (80) with 73 registrants. On the program day, we logged 61 attendees including speakers and staff.

In this second workshop, the Venable speakers provided a detailed review of legal issues that can arise when nonprofits make mistakes regarding wage and hour laws. Topics covered included matters such as legal issues touching on common FLSA exemptions, independent contractors, unpaid interns, volunteers, split shifts, training, off-the-clock work, travel time, and more. Out of 61 attendees, 8 were staff members and 3 were speakers, with 50 registrants present. Of those 50, 27 attendees (54%) provided evaluations. All except one respondent gave numerical ratings to the program. The provided ratings were once again very high, averaging 8.88.

Most attendees (25 out of 27, or 92.6%) indicated that the program met their expectations in some way: 24 out of 27 (88.9%) said they learned what they expected to learn; one attendee said “mostly” but indicated that the person wanted to learn something specific that was not covered; one person said “somewhat” (2.5%); two persons did not check yes or no, but indicated in comments that they wished for greater clarity on specific points. Out of 27 respondents, there were 26 who said they learned something from the workshop that they would use at work (96.3%). One respondent did not answer this question. The attendees cited a variety of things learned that they intended to use at work; common things cited included tips about split shifts, interns, volunteers, and independent contractors. BBB Accredited Charity Seal

As of April 2013, the Metro NY BBB Accredited Charity Seal program has

grown steadily to include 258 participating charities, up 6% from 243 seals at the same time in the prior year, and an increase of 17% from 220 in December 2010.

The BBB Accredited Charity Seal symbolizes accountability in charities. The

BBB Seal provides a quick-check, easy-to-understand communications tool for the benefit of both charities and donors. It captures complex numbers, facts, and policies in a simple seal, showing that a charity has met all 20 of the BBB’s Standards for Charity Accountability.

Organizations seeking to become a BBB Accredited Charity Seal Holder must

first participate in a BBB review. The charities complete a questionnaire and submit financial statements and fundraising materials. The resulting BBB report includes a determination about the charity’s performance measured against the 20 BBB Standards, as well as a summary of the organization’s mission, programs, governance and key financial information.

Charities that meet all 20 BBB Standards for Charity Accountability are noted as BBB Accredited on BBB websites. There is no cost for the review or to be accredited.

BBB Accredited Charity Seal participation is an additional and optional

program, only for charities meeting all BBB Standards in a BBB review. Eligible BBB Accredited charities that choose to license the BBB Seal for fundraising and marketing purposes are asked to sign a formal agreement specifying how the trademarked BBB Seal may be used, and pay a licensing fee pegged to charity size. The Metro New York BBB Seal fee ranges from $50 to $1,000 annually for most organizations. The maximum fee of $5,000 is for very large organizations with public contributions of over $60 million.

Seal participants may display the Seal in transient advertising and solicitations such as newspaper ads, posters, direct mail appeals, in annual reports, and on letterhead stationery. Seal participants may also install the Seal anywhere on the local charity’s primary website, on any website where the local charity advertises, and in emails, provided the Seal clicks to the online BBB charity report.

As a benefit of Seal program participation, at no extra cost, BBB Charity Seal

Holders in good standing at the time of publication are recognized in BBB-sponsored newspaper ads. In 2011 and 2012, this newspaper campaign was expanded to include ads in the spring as well as at holiday time.

The two-page BBB Charity Seal Holder ad as it appeared in the New York Observer, November 2012.

Guide to BBB Charity Seal Holders Available via www.newyork.bbb.org or go to http://nycharityguide.org The Guide to Charity Seal Holders is a convenient tool for people who want information on seal-holding local charities that meet the BBB’s 20 rigorous accountability standards. Visitors to the Guide will find links to each charity’s full BBB review, details about the organization’s mission, contact information, and links to the charity’s own website. From April 14, 2012 through April 13, 2013, the mini-site alone has drawn 8,011 visits and 7,115 unique visitors. Average time spent on the mini-site was 52 seconds with 1.81 average pages per visit during this period.

BBB’s Online Charity Reports New York Sites: www.ny.give.org, www.newyork.bbb.org International Sites: www.give.org, www.bbb.org

Donors and the general public can find all BBB charity reports by name and location through searches at either local or international BBB websites. As of April 2013, there are 796 Metro New York area BBB charity reports and about 1,300 national BBB charity reports available through BBB websites. About 11,000 national and local BBB charity reports in all are available across the BBB system. In addition, BBB websites contain a wealth of educational information for charities about meeting high standards, and tips for the public about wise giving practices. Moving forward, BBB Foundation is focusing its proactive efforts to review Metro New York charities that meet the following description:

• Publicly soliciting charities, at least two years in business, located in our reporting territory: New York City, Long Island, or the following counties of

The Guide to Charity Seal Holders at www.newyork.bbb.org/charityguide.

the Mid-Hudson Region - Westchester, Dutchess, Putnam, Rockland, Sullivan, Ulster, and Orange.

• Charities that are of significant public interest, indicated by factors such as (but not limited to) the following: - At least $250,000 or more in publicly solicited donations - Charity or charity leader has won awards, or is the subject of media attention - Evidence or reports that a charity or its leader may be involved in questionable or fraudulent activities - BBB has received inquiries about the charity in question

In 2012, BBB Foundation purchased data about charities meeting this description. We sorted the data to identify charities of priority interest, and we are currently contacting those charities to invite them to participate in BBB charity review at no cost. This outreach effort is being paired with no-cost educational programs about how to meet BBB Standards for Charity Accountability.

Smaller publicly soliciting charities with at least $25,000 or more in publicly

solicited donations may voluntarily request BBB charity review. BBB may also review or report on smaller or newer charities if they appear to be of significant public interest. BBB Charity Reporting Changes

During 2011, the BBB Foundation worked closely with the BBB Wise Giving Alliance to propose updated national language for “nondisclosure” charity reports. This notice is published by BBB when a charity of significant public interest fails to respond to BBB inquiries or declines to provide information voluntarily to facilitate completion of a full BBB charity review.

Upon action by the national BBB Wise Giving Alliance Board of Directors, the

new language was enacted in December 2011 for the entire BBB system, and became effective for all BBB charity reports as of the end of January 2012. It now reads as follows:

This charitable organization either has not responded to written BBB requests for information or has declined to be evaluated in relation to BBB Standards for Charity Accountability. Charity participation in BBB review is voluntary. However, without the requested information, it is not possible to determine whether this charity adheres to all of the BBB Standards for Charity Accountability. The BBB encourages charities to disclose accountability information beyond that typically included in financial statements and government filings, in order to demonstrate transparency and strengthen public trust in the charitable sector.

In 2011, the BBB Wise Giving Alliance Board also enacted several updates to the Implementation Guide to the BBB Standards for Charity Accountability. The following language was added to the Implementation Guide regarding Standard 1, which is a governance-related standard:

Furthermore, if a senior executive of a charity supervises its paid or unpaid staff members, or otherwise performs functions that would usually be attributable to the chief executive or chief operating officer, on either an

uncompensated or compensated basis, regardless of the nature of that person’s formal title, that individual may not also serve as chair of the same charity’s board of directors.

This new guidance speaks to the importance of having charity board leadership that is sufficiently independent of that charity’s management, in order to provide appropriate governance. If a compensated charity CEO or someone performing comparable functions were to serve as a charity’s board chair or most senior board leader as well, that might also result in a failure to meet the BBB’s Standard 4, which also relates to board independence. At the national level, the BBB Wise Giving Alliance also made a change to Standard 11, which will not apply to Metro New York area charity reviews, due to New York State requirements. Nationally, the threshold requirement for submission of a charity’s audited financial statement to facilitate BBB charity review has been raised to $500,000 from $250,000 in publicly contributed donations. However, in New York State, charities continue to be required to conduct an audit if they receive $250,000 in donations or more. So long as New York State requires that an audit must exist at this level, NYPAS will continue to require submission of an audited financial statement for BBB charity review when a charity has received at least $250,000 in contributions in the prior year.

Interested parties may view the newly updated Implementation Guide to the BBB Standards for Charity Accountability in its entirety online, at this web address: www.bbb.org/us/Charity-Evaluation. Internet-Based Efforts to Promote and Track Public Use of BBB Charity-Related Information and Foundation Projects We tracked an estimated 63,325 overall page views for charity related pages at www.newyork.bbb.org from January 1-December 31, 2012. This represents an increase from 19,824 tracked page views in the prior year. The total is not comprehensive but only reflects information from the top 100 reviewed pages in a category. The 2012 totals include statistics for information about NYPAS, the BBB Standards for Charity Accountability, the BBB Charity Seal, information about charity reviews, resource information in the Learn About Charity Effectiveness mini-site, events for charity leaders, and information for donors. In addition to this, we tracked a further 26,806 overall page views in 2012 for BBB Foundation public education information as well as events. Topics visited include the Good Business Practices educational program (22,282 overall page views); information about the BBB Forum on Corporate Responsibility (717 overall views); information from the BBB Live project, Take Control of Your Debt in English and Spanish (2,837 overall views); information from a prior BBB Live project about foreclosure, in English and Spanish (460 overall views); information for seniors and their caregivers (510 overall views), plus page views of other content. Therefore, BBB Foundation related web pages on www.newyork.bbb.org received well over 90,000 overall page views in 2012. This does not include visits to the BBB Foundation material at www.bbbmoneynow.org for the Get More Money Now financial literacy project, which is displayed in its own separate mini-site.

Through a generous in-kind search ad grant, the Metro New York BBB Foundation has been able to create Internet search ads that guide the public to its website charity reports and information about charity accountability. Between March 17, 2004 and April 12, 2013, Internet ads about general NYPAS charity information services drew a total of 51,652 clickthroughs to the www.newyork.bbb.org website, with a total of 3,618,375 “impressions” or exposures of the ads in searches, yielding an overall effectiveness rate of 1.43%.

In 2011, although the website drew many thousands of page views, the online search PSAs for charity information by themselves drew 1,797 clickthroughs to Metro New York BBB charity information, virtually the same as last year’s result. Realizing that new strategies are needed to draw public attention to this donor resource, with donated professional assistance, we created further PSAs and launched them in 2012.

New “Give With Trust” BBB Charity Information PSA Campaign Launched in 2012

With generous professional assistance contributed by Conversation LLP, the BBB Foundation created and launched a new “Give With Trust” series of PSAs for television, radio, print and digital media.

Give With Trust print PSA, 2012-2013

The PSAs were launched at holiday time in 2012 and successfully placed in

media through January 2013. PSA placements were confirmed on 24 area radio stations, including many of the largest, plus Bloomberg Radio Network. There were TV placements on Cablevision and WABC-TV, with additional placements possible in 2013, and the TV spot will run for at least a year as a pre-roll video PSA online, on Hulu. Digital PSA banners appeared on New York Magazine, AOL, Huffington Post, and Ad.com websites. We will encourage additional PSA placements for these messages through 2013.

Overview of BBB Foundation Charity Accountability Program (NYPAS)

Of the 512 charities given complete reviews, 409 (80%) met all Standards; 103 (20%) failed one or more Standards vs. 24% last year. Out of 786 total reports, 248 (32%) were nondisclosure reports; 16 (2%) were not ranked.

Nondisclosure means the charity failed or declined to respond to requests for information. Not ranked means the charity would not normally be eligible for BBB review, but a report without BBB review evaluation was prepared as a courtesy, upon request.

Average Percent of Total Spent by Reviewed Charities, 2012

Fundraising 8%

Administration12%

Programs 80%

Status of Charities Participating in NYPAS Program 2012 (786)

409

103

248

16

0

50

100

150

200

250

300

350

400

450

Meets AllDoes Not MeetNon-DisclosureNot Ranked

Commonly Missed BBB Charity Standards: 2012

The two most-missed Standards concern the organization’s annual report and board-approved budget. Effectiveness Standards 6 and 7 are among the top 5 most-failed Standards. Note: Individual charities may have missed more than one of these Standards. Counts therefore do not add up to total number of charities that failed BBB Standards.

Commonly Missed BBB Standards in 2012: 103 out of 512 Complete Reviews 16. Annual Report. Have an annual report available to all, on request, that includes: (a) the organization’s mission statement, (b) a summary of the past year’s program service accomplishments, (c) a roster of the officers and members of the board of directors, (d) financial information that includes (i) total income in the past fiscal year, (ii) expenses in the same program, fund raising and administrative categories as in the financial statements, and (iii) ending net assets. (57 charities) 14. Board-Approved Budget. Have a board-approved annual budget for its current fiscal year, outlining projected expenses for major program activities, fund raising, and administration. (43 charities) 1. Oversight. A board of directors that provides adequate oversight of charity’s operations and staff. (43 charities) 6. Effectiveness Assessment Policy. Have a policy of assessing, no less than every two years, the organization’s performance and effectiveness, and determining future actions required to achieve its mission. (41 charities) 7. Effectiveness Reporting to Governance. Submit to the organization’s governing body, for its approval, a written report that outlines the results of the aforementioned performance and effectiveness assessment and recommendations for future actions. (43 charities) 17. Website Disclosures. Include on any charity websites that solicit contributions, the same information that is recommended for annual reports, as well as the mailing address of the charity and electronic access to its most recent IRS Form 990. (41 charities) 3. Governance Meetings. A minimum of three evenly spaced meetings per year of the full governing body with a majority in attendance, with face-to-face participation. (23 charities) 8. Program Activities Expenses. Spend at least 65% of the organization’s total expenses on program activities. (17 charities) 18. Privacy. Address privacy concerns of donors by (a) providing in written appeals, at least annually, a means (e.g., such as a check off box) for both new and continuing donors to inform the charity if they do not want their name and address shared outside the organization, and (b) providing a clear, prominent and easily accessible privacy policy on any of its websites that tells visitors (i) what information, if any, is being collected about them by the charity and how this information will be used, (ii) how to contact the charity to review personal information collected and request corrections, (iii) how to inform the charity (e.g., a check off box) that the visitor does not wish his/her personal information to be shared outside the organization, and (iv) what security measures the charity has in place to protect personal information. (15 charities)

Additional Information on NYPAS Charity Reviews in 2012 Field/Focus Area: Regional Breakdown (all charities covered in NYPAS reports at this time)

• 548 (70%) of the charities are from the 5 boroughs of New York City. • 182 (23%) of the charities are located in Long Island. • 55 (7%) of the charities are located in the Mid-Hudson Region.

Financial Data: excludes charities that did not disclose information Total Public Support (includes donations, corporate and government grants, and in-kind services)

• The total amount of public support received: $3,811,672,343 ($3.8 billion) • The average of total public support received: $7,246,525 • The median of total public support received: $1,977,616

Total Revenue (includes earned-income, government contracts, and public support) Of the organizations listed in our 2012 charity reports, the total amount of revenue from all sources: $9,931,437,082 ($9.9 billion) The smallest amount of total support received by an individual charity: $719 The largest amount of total support received by an individual charity: $311,026,000 Average Spending Ratios: excludes charities that did not disclose information

• Organizations spent an average of 80% of total expenses on program services.

• Organizations spent an average of 12% of total expenses on administration. • Organizations spent an average of 8% of total expenses on fundraising.

Organizations spent an average of 14% of their total public support on fundraising. In other words, 14 cents of each donated dollar was spent on fundraising.

Giving Guide Category (528) Number Percent Health & Human Services 205 39% Children, Youth & Families 98 19% The Arts & Culture 85 16% Community Development & Civic 61 12% Animals & the Environment 28 5% Education & Literacy 26 5% Law & Public Interest 14 3% Religious 5 1% General 5 1%

BBB Foundation Public Education and Outreach Programs Latino Initiative In 1999, the BBB Foundation created The Latino Business and Consumer Education Initiative. Through this long-term initiative, the Foundation seeks to promote consumer fraud prevention for Hispanics and raise awareness of key issues that affect Latino consumers, businesses and charities in New York. The Get More Money Now, BBB Live: Protecting Your Home, and BBB Live: Take Control of Your Debt projects are some of our programs related to this initiative. Previous Latino Initiative related programs have also included Latino Executive of New York (LENY) Awards events to honor Hispanic business leaders, educational projects such as Good Business Practices for Entrepreneurs, and technology development projects to build infrastructure for support of program services in both Spanish and English.

Educational Programs for Consumers BBB Live/Toma Control de Tus Deudas (Take Control of Your Debt), November 2- 10, 2011

WXTV Univision 41 Reporter Berenice Gartner prepares for live broadcast from the BBB during the 2011 event, as Spanish-speaking volunteers help consumer callers.

On November 2, 2011 the BBB Foundation presented its fourth “BBB Live” program for Spanish speakers in collaboration with WXTV Univision 41 and with generous sponsorship by Banco Popular (now Popular Community Bank). The freshly updated program, entitled Take Control of Your Debt/Toma Control de Tus Deudas, provides important information to the public about dealing with consumer debt. It remains posted on the BBB website at www.newyork.bbb.org/debt and www.newyork.bbb.org/deudas in 2013.

L to R: Team captain and Hispanic Advisory Committee member Dawn Carrillo of Banco Popular (now Popular Community Bank); Berenice Gartner of WXTV Univision 41; Claire Rosenzweig, Better Business Bureau; and Hispanic Advisory Committee member Maria Roman of One Hundred Hispanic Women.

Volunteer bi-lingual professionals answered calls to a special hotline at the Metro New York BBB office which was promoted on-air by Univision. Callers were referred to credible local and national sources of help for issues such as managing heavy debt burdens and debt collection problems. There were a total of 56 volunteers plus 4 staff members participating in the 2011 project – slightly fewer than in 2010, but more efficiently distributed across time segments when the greatest number of calls were received and when call-backs needed to occur. This led to greater productivity in 2011. Those who called the hotline on November 2 were aided by 44 volunteers who generously donated their time and energy to the program. In addition, 14 further volunteers contributed their help to call back consumers whose voice messages could not be returned on the actual program day, in a series of three callback team sessions. Volunteers and advisory help came from the following diverse group of companies and nonprofits: Acción USA; Banco Popular, now known as Popular Community Bank, which fielded a very large volunteer team; Brooklyn Bar Association Volunteer Lawyers Project; Center for Client Retention; Center for New York City Neighborhoods; Civil Legal Advice and Resources Office (CLARO); Dentorium Products; Ernst & Young LLP; Fiscal Management Associates; Fordham Law School; Goodwill Industries of Greater New York and Northern New Jersey; Grey Group; Law Practice Mgmt., Inc.; Literacy Partners; Macy's; MBAF ERE; Money Management International; My Sisters Place; New York Society of Association Executives; NYU Steinhardt CRCDE; Office of the New York City Comptroller; One Hundred Hispanic Women; Jose Polanco Law; Preferred Dental Care; People en Español/Time Inc.; T.A.Y. Corp N.Y.; Valjato Engineering PC; Winston & Strawn LLP; WXTV Univision 41; and several individuals.

Live broadcast by Univision: filming volunteers who are answering consumer calls.

On the day of the event, as before, Univision’s consumer reporter Berenice Gartner did a live report from the BBB’s offices while volunteers took calls behind her. To ensure that callers got the information they needed, follow-up mailings in Spanish were sent to consumers who provided contact information. Consumers received a tip sheet about debt issues, with information on key resources that provide help to debtors. They also received a brochure about how to handle money issues in Spanish, “Más dinero ya” (“Get More Money Now”). CONSUMER CALLS:

• Total calls received: 870 (about a 27.9% increase in call volume, over 2010 with a 680 call total)

• Nov 2 completed calls: 534 • Nov 3 completed call backs (when contact information was given): 209 • Call backs processed on later dates: 127

FOLLOW-UPS: Brochure and Tip Sheet

• Total follow-ups: 579 (vs. 449 in 2010, increase of about 29%) • Mailed follow up pieces: 464 • Emailed follow-ups: 115

VOLUNTEERS:

• Total inbound call volunteers Nov 2: 44 • Total call-back volunteers Nov 3: 9 • Total call-back volunteers Nov 9: 2 • Total call-back volunteers Nov 10: 1 • Total volunteers: 56 • BBB staff participating voluntarily in inbound call handling and call-backs: 4

TRACKED PAGE VIEWS TO PROGRAM CONTENT ONLINE – 2011 www.newyork.bbb.org/debt and www.newyork.bbb.org/deudas In 2011, we added a web banner on our home page to make this content more visible and accessible. This extended the reach of the program.

• In English: 951 overall page views, 821 unique views • In Spanish: 583 overall page views, 510 unique views

REASONS FOR IMPROVEMENT: • Calls were received throughout the day, not just at the end, thanks to

Univision’s idea of using an on-screen promo crawl on WXTV 41 during lower volume daytime periods. As a result, there were fewer periods with low inbound call volume.

• A call team member transcribed voice messages and assigned them as call-backs to other volunteers who were not answering calls. This meant we were able to handle many more calls on the program day with live operators.

• We successfully recruited a larger team for the final shift during peak call volume; also, the decision to start an hour later and push program end time back to 9 PM instead of 8 PM worked well.

• Consumers seem to be facing bigger debt problems this year. Common situations cited during calls include lost jobs; major unpaid medical bills; students unable to get employment to pay off student loans; fraud and ID theft victims.

A further BBB Live program on Identity Theft, originally scheduled for November

2012, was rescheduled due to Superstorm Sandy and took place in January 2013. Details on that event will be provided in the 2012-2013 Annual Report. Get More Money Now (Más dinero ya) Generously supported by the FINRA Investor Education Foundation In May 2006, with generous support from the FINRA Investor Education Foundation, the BBB Foundation launched a national public education campaign on credit and debt management, as well as basic saving and investing principles, entitled Get More Money Now (Más dinero ya). At that time, the Bank of New York – now known as BNY Mellon - and BBB Military Line/Council of Better Business Bureaus also generously provided further support to enable special printings and distributions of the program material to New Yorkers and to military personnel across the US. In 2008 and 2010, FINRA Investor Education Foundation provided additional generous support to update, reprint, and re-distribute the Get More Money Now brochures.

In 2011, FINRA Investor Education Foundation generously supported the printing and nationwide distribution of a further 45,775 brochure copies in English through 31 BBB system offices across the nation, as well as through the office of the Indiana Attorney General, not including copies printed for additional distributions by the FINRA Foundation.

The Get More Money Now program in English and Spanish is being distributed through BBB Accredited companies, Better Business Bureaus nationwide, community organizations, libraries, Hispanic business associations, and other Hispanic groups.

Our records show that there are well over half a million brochure copies in print, in English and Spanish, most of which have already been distributed to the public.

Get More Money Now (Más dinero ya) www.bbbmoneynow.org Program content can be viewed and printed out, in Spanish and English, from: www.bbbmoneynow.org. In 2012, the site logged 49,525 unique visitors, up 7% from 46,250 unique visitors in the prior year – showing continued strong interest in the program. Scam prevention content pages were the most popular. As of April 15, 2013, according to Google Analytics, the project’s website had attracted a total of 436,811 unique visitors – of which 17,464 were returning visits, and 421,549 were attributable to search PSAs. As of the same date, total of 30,200,429 impressions were attributable to the search PSAs.

Educational Programs for Business BBB Forum on Corporate Responsibility V – June 7, 2012 “Great Business Performance: The Role of Corporate Responsibility” Generously supported by Ernst & Young LLP, Nielsen, NYSE Euronext and Tishman Speyer and hosted by EmblemHealth. About 130 executives packed the house to hear high-profile speakers discuss business responsibility challenges at the sold-out June 7, 2012 BBB Forum on Corporate Responsibility (out of 165 total registrants, a 77% attendance rate). Attendees included senior executives from major corporations, small businesses, consulting firms, nonprofits, government agencies, and BBB staff.

Keynote Speaker Timothy McClimon of American Express discussing the importance of a continued focus on sustainability for both companies and the communities in which we work and live.

Keynote speaker Timothy McClimon, Vice President, Corporate Social Responsibility, American Express and President, American Express Foundation kicked off the event with a thought-provoking presentation entitled, “What’s the Future of Corporate Responsibility?” L to R, panel moderator Michelle Greene and panelists Pamela Gill Alabaster, L’Oreal USA, Anisa Kamadoli Costa, Tiffany & Co., and Dave Stangis, Campbell Soup Company.

The keynote was followed by a thought leader panel entitled “Next Steps: Global and Domestic Challenges, Solutions and Trends” and moderated by Michelle Greene, Vice President and Head of Corporate Responsibility at NYSE Euronext and Executive Director of NYSE Euronext Foundation. Panelists included Pamela Gill Alabaster, Senior Vice President, Corporate Communications, Sustainable Development & Public Affairs, L’Oreal USA; Anisa Kamadoli Costa, Vice President, Global Sustainability & Corporate Responsibility, Tiffany & Co., and President, The Tiffany & Co. Foundation; and Dave Stangis, Vice President, Public Affairs and Corporate Responsibility, Campbell Soup Company, President, Campbell Soup Foundation. The panelists shared details about their Corporate Responsibility programs and strategies, and answered audience questions.

L: Curtis Ravenel, Bloomberg L.P., presenting “ESG Revolution: How Environmental, Social & Governance Data is Driving the Market of the Future.” R: Stephen T. Starbuck, Ernst & Young LLP, presenting “Reporting Responsibility: What You Need to Know About Disclosure, Integrated Reporting, and Assurance.”

Two special reports followed the panel. Curtis Ravenel, Global Head of Sustainability, Bloomberg L.P., presented “ESG Revolution: How Environmental, Social & Governance Data is Driving the Market of the Future.”

Next, Stephen T. Starbuck, Americas Leader, Climate Change and

Sustainability Services, Partner, Ernst & Young LLP, presented “Reporting Responsibility: What You Need to Know About Disclosure, Integrated Reporting, and Assurance.” The presentations concluded with a question-and-answer session with Ravenel and Starbuck.

Left Photo: Panel moderator Harriet P. Pearson, Esq., IBM Corporation and panelists Flora Garcia, Esq., Time Inc.; Valerie Reardon, EmblemHealth; and Marcus H. Sachs, Verizon Communications. Right Photo: L to R, Claire Rosenzweig, BBB Serving Metro NY, Sheila L. Sullivan, Coty Inc., and Valerie Reardon, EmblemHealth.

The Forum program concluded with a distinguished panel of experts, who reviewed developments in privacy and cybersecurity and the implications for businesses. Harriet P. Pearson, Esq., Vice President, Security Counsel & Chief Privacy Officer, IBM Corporation moderated the panel.

Panelists included: Flora Garcia, Esq., Senior Privacy Director, Time Inc.,

Valerie Reardon, Senior Vice President, Compliance, Internal Audit and Internal Controls, EmblemHealth, and Marcus H. Sachs, Vice President, National Security Policy, Verizon Communications.

In 2012, the BBB Forum had 15 Event Supporter organizations, which collaborated on encouraging event attendance. Many also sent representatives to the program. They included: Advertising Self-Regulatory Council, American Sustainable Business Council, Council of Better Business Bureaus, CSRHub, Ethics and Compliance Officer Association, Forum for the Future, Governance & Accountability Institute, Inc., Interfaith Center on Corporate Responsibility, Net Impact NYC, New York Privacy Officers' Forum, New York Society of Association Executives, Social Accountability International, Sustainability Practice Network, Women's Network for a Sustainable Future, Robert Zicklin Center for Corporate Integrity at Baruch College. Also, Corporate Responsibility Magazine was a Media Supporter for the event.

Driving Business with Social Media – April 4, 2012, NYC Engaging Your Customer: Reaching Out with Email, Social Media & SEO – September 12, 2012, Long Island Generously supported in 2012 by Constant Contact With generous support from Constant Contact, the BBB Foundation presented two programs in 2012 for business and nonprofit leaders on using social media and other forms of online communication to strengthen their organization. “Driving Business with Social Media” was presented on April 4, 2012 to a sold out crowd of 100+ attendees at Scandinavia House in New York City. Attendees included both business and nonprofit executives. The speaker was Wendi Caplan-Carroll, Senior Regional Development Director, New York Metro, Constant Contact. Of the 33 attendees who returned evaluations, 32 rated the program on a scale of 1 to 10, with 10 being the highest. Almost all of the ratings fell between 8 and 10, with the average being a very high 9.2. “Engaging Your Customer: Reaching Out with Email, Social Media and SEO” was presented on September 12, 2012 at the Melville Marriott Long Island. There were 49 attendees and they included both business and nonprofit executives. The speakers were Craig E. Yaris, Chief Social Marketer, Esquire Tech Solutions and Randy Shannon, President, Web Strategies. Of the 21 attendees who returned evaluations, 18 rated the program on a scale of 1 to 10, with 10 being the highest. Most ratings fell between 8 and 10, with the average being a high 8.6.

Wendi Caplan-Carroll of Constant Contact discusses measuring the impact of social media as attendees listen.

Skill-Building Volunteer Intern Program How the Program Works Our BBB Foundation is proud to maintain an ongoing, extensive internship program. We provide charity review program interns with nonprofit accounting experience and an overview of the nonprofit sector in New York, as well as invaluable details about the management and governance of charities. Many other interns under our Foundation’s program acquire valuable career skills by assisting with BBB dispute resolution and customer service activities. Volunteer Intern Program Activities in 2012

In 2012, our Volunteer Intern Program activities advanced significantly:

• There were 82 interns in all for the year, up by 25 or 44% over 2010. • Intern hours rose to about 15,691.5 hours – up by 6,727.5 or 75%. • Cases/reports completed with intern assistance totaled 25,448.

Growth of Skill-Building Volunteer Intern Program Over 3 Years Our Skill-Building Volunteer Intern Program has expanded in recent years to become a year-round effort, although summer remains a peak period for program activities. This has contributed to program growth. Former interns Peter Espinoza, Andrew Palestrant, Anthony Ali, Christopher Vincent, Marquise Gordon, Malaika Joseph, Erica Elliott, Kathy Son and others have subsequently become full or part-time BBB employees. Intern Hours for 2012 Number of 2012

Interns Cases/Reports Assisted by Interns in 2012

4,771 NYPAS 27 NYPAS 253 NYPAS 7,300.5 NYC (Dispute

Resolution) 42 NYC (Dispute

Resolution) 20,875 NYC

0 NYC (Business Development)

0 NYC (Business Development) - -

3,620 Mid-Hudson 13 Mid-Hudson 4,320 Mid-Hudson 15,691.5 Total 82 Total 25,448 Total

Intern Hours for 2011 Number of 2011 Interns Cases/Reports Assisted by Interns in 2011

2,694 NYPAS 15 NYPAS 461 NYPAS 8,936 NYC (Dispute

Resolution) 48 NYC (Dispute

Resolution) 23,545 NYC

304 NYC (Business Development)

1 NYC (Business Development) - -

1,115.75 Mid-Hudson 10 Mid-Hudson 1,902 Mid-Hudson 13,049.75 Total 74 Total 25,908 Total

Intern Hours for 2010

Number of 2010 Interns

Cases/Reports Assisted by Interns in 2010

1,250 NYPAS 11 NYPAS 229 NYPAS 7,631 NYC (Dispute

Resolution) 43 NYC (Dispute

Resolution) 21,684 NYC

0 NYC accounting 0 NYC Accounting - - 83 Mid-Hudson 3 Mid-Hudson 131 Mid-Hudson

8,964 Total 57 Total 22,044 Total

Interns come from a wide variety of schools. Colleges attended by interns have included Baruch College, Benjamin N. Cardozo School of Law, Berkeley College, Brooklyn College, Columbia University, Dickinson College, EF International Language School, Fordham University, Hunter College, LaGuardia Community College, New York University, Queens College, Sarah Lawrence, University of Rochester, Wesleyan University, and many others. Intern Career Lunches with Leading Executives One of the many valuable parts of the BBB’s Summer Intern program is its series of casual weekly luncheons hosted by the BBB, where interns get the rare chance to meet and speak with outstanding business and nonprofit leaders. Speakers discuss their career paths and provide interns with an insider’s view of the New York business and charity community. In 2012, luncheon speakers included high-profile BBB Board members. Formerly a summer-only program, the career luncheons are now being scheduled throughout the year.

Interns get insights from Lisa Davis, Senior Director, Communications Colgate-Palmolive’s Global Director

& Public Affairs at Sony Corp. of America, 2012 of Sustainability & Social Responsibility, John Simone, 2012

Intern Career Lunches with Leading Executives

John Grudzina, EVP, Chief of Staff and Melissa Krantz, President, Krantz & Co. Administration, General Counsel at Grey with an intern, 2012 Global Group, 2012

Michael Portegello, Partner, Ernst & Michael Brizel, EVP and General Young LLP, with interns, 2012 Counsel, Saks Fifth Avenue, 2013

Frank O’Brien, Founder, Conversation LLP, Rhonda McLean, Deputy General Counsel, “Recognize Opportunity,” 2013 Time Inc., and BBB Chair, at a 2012 event

Interns provide exit survey feedback about their BBB experiences, which is

typically very positive. A quote from one 2012 intern: “Every moment at the BBB was interesting to me because I came in every day and learned something new.”

Another wrote: “This was a great experience for learning how to listen and mediate without bias.”

Yet another said: “Change nothing. This program is awesome and helps

students like me walk away with great knowledge.” We are grateful to BNY Mellon, Colgate-Palmolive, Grey Global, Sony Corporation of America, Coty Inc., Whitehead Foundation/John C. Whitehead, Fiscal Management Associates, and The Fiftieth Anniversary Foundation for their generous grants in 2012 and 2013; and to Tishman Speyer, Peter J. De Luca Family Fund, and Saks Fifth Avenue for their recent, valued grant support of this program.

###

Populations Served by Metro New York’s BBB Foundation The Education and Research Foundation of the Better Business Bureau of Metropolitan New York provides information and assistance to consumers, nonprofits, businesses, journalists, professionals (such as consultants, accountants, and attorneys) and government officials who are interested in the following:

• Ethical business and charity standards and practices • Consumer and business protection, fraud prevention, and education • Charity review • Charity accountability and governance • Technical assistance for charities • Wise giving practices for donors • Charity effectiveness and impact

The primary geographic focus is on residents of New York State and New York City. However, many of the Foundation’s educational programs – such as its financial literacy program, Get More Money Now - have been distributed nationally with great success. The Foundation’s charity accountability program, the New York Philanthropic Advisory Service or NYPAS, is a national model for comparable programs in the BBB system. Under its Latino Initiative, the BBB Foundation has made a concerted effort to develop resources that would enable it to provide culturally appropriate, needed consumer and business information to the public in both Spanish and English. This is an ongoing project. Recent BBB Live television call-in programs in Spanish under this Initiative have reached and served consumers in the Tri-State Area, as well as some states well outside of the Metropolitan New York vicinity.

The Better Business Bureau: BBB Foundation Affiliate and Collaborator

BBB Accredited Businesses

In 2012, the BBB system celebrated its 100th anniversary year. Better Business Bureau Accredited Businesses make a commitment to conduct their business affairs with reliability and integrity, in accordance with BBB Standards and guidelines. Consumers understand the nature of this commitment and value it. BBB is a leader in the effort to create a market where buyers and sellers can trust each other. Consumers and businesses can Start With Trust® by turning to the BBB for business and charity reliability information.

Business Integrity and Consumer Trust

Trust in business is essential for a strong economy. Customer confidence is a vital element of business strength. The Better Business Bureau encourages business practices that will merit consumer trust.

On June 22, 1922, the Metropolitan New York Better Business Bureau was founded to combat investment fraud, as well as deceptive advertising. Today, by promoting guidelines for reputable conduct in advertising and in the online marketplace, the BBB helps companies become successful and grow. By reporting on consumer experiences with businesses, the BBB encourages public recognition of companies that demonstrate integrity and reliability in their operations.

Solving Problems Without Litigation BBB helps to solve problems between businesses and customers without litigation, and gives consumers and businesses pre-purchase information that often saves them money and trouble.

Well over 3 million times a year, individuals and businesses contact the Metropolitan New York BBB to use its services. They visit the website, call, write, email, or even walk in the door, to ask about business and charity reliability, request educational information, and file complaints. This level of volume is remarkable, considering the fact that Metro New York’s BBB is a nonprofit organization staffed by a relatively small group of professionals and volunteers.

Feedback: Hundreds of people send thank-you emails and letters. One consumer wrote to say, “I was very pleased to receive a refund check this past weekend from __. I honestly was beginning to think I was getting nowhere with them, until you stepped in. I sincerely thank you for your assistance…I’m sure I’m not the only person who appreciates your help.” We also received this comment: “Thank you so much for your help. You helped get that stress out of my life. I appreciate it.” Yet another consumer emailed us to say: “Thanks! I have found the BBB more effective than the A.G. or State Bar. Good job!”

Metropolitan New York’s BBB collaborates with its separately incorporated and governed BBB Foundation to create public education programs that are relevant to our community’s changing needs.

Metro New York BBB Foundation Board of Directors and Officers

2012

Chairman Keith Darcy Executive Director Ethics & Compliance Officer Association Vice Chairman Reg Foster Corporate Responsibility Coordinator Corporate Citizenship & Corporate Affairs IBM Corporation Treasurer Hilda H. Polanco, CPA, CCSA Managing Director Fiscal Management Associates, LLC President Claire Rosenzweig President & CEO BBB Serving Metropolitan New York and the Education and Research Foundation of the BBB of Metropolitan New York (Ex-officio)

Directors Laurie J. Bilik President Global Human Resources Mauricio Hernandez Executive Vice President, Business Services Goodwill Industries of Greater New York and Northern New Jersey Michele Kay EVP, Partner Grey Group Frank O’Brien Founder Conversation, LLC Victoria Sweeney Principal, Legal, Risk and Regulatory KPMG LLP

Metro New York BBB Foundation Statement of Activities*

Year Ended December 31, 2012

Unrestricted Net Assets

Temporarily Restricted Net

Assets

Total Net Assets

Support and other revenues: Contributions $ 111,940 $ 112,911 $ 224,851 Interest 902 902 Charity seal income 202,659 202,659 Seal Review support 15,000 15,000 Income from related party 11,472 11,472 Donated services** 160,083 160,083 502,056 112,911 614,967 Net assets released from restrictions due to satisfaction of program restrictions

102,958 (102,958) 0

Total support and other revenues 605,014 9,953 614,967 Expenses: Program services: Philanthropic Advisory Service (NYPAS)

369,019 369,019

Educational initiatives 111,966 111,966 Total program services 480,985 480,985 Supporting services: Management and general 60,380 60,380 Fund-raising 17,212 17,212 Total supporting services 77,592 77,592 Total expenses 558,577 558,577 Change in net assets 46,437 9,953 56,930 Net assets – January 1 592,438 62,750 655,188 Net assets – December 31 $ 638,875 $ 72,703 $ 711,578

* Unaudited preliminary statement, subject to review and confirmation. ** Donated services were for contributed educational public service announcements (PSAs) and volunteer services. A copy of the latest annual report for the Education and Research Foundation of the Better Business Bureau of Metropolitan New York may be obtained, upon request, from the organization or from the Office of the Attorney General, 120 Broadway, New York, NY 10271.