Individual Giving
As we enter into the holiday season, there tends be more appeals from fundraisers and more calls made and literature sent to potential donors. How does an individual decide?
Donors still tend to give because giving makes them feel good, because they receive tax benefits or because a friend has asked them to give to their special cause. All of these reasons are fine, but would you decide upon an investment if there was no accountability for a return? How often would you invest in a company that yearly asks you for more money without showing you any profit or any type of financial return? I think I already know the answer.
If donors do not ask for greater accountability, then we are not rewarding those charities that do supply us with an efficient operation and strive for greater end client results. We lump all the charities into the same pot and yet are they all the same in terms of efficiency and effectiveness?
The greatest motive for giving is to feel good. Donors like to think that their money is helping causes achieve what their mission states. In many cases, you are helping. However, if you asked for their client success rate, you might be surprised by some of the responses of your favourite charities. In some cases, they might not even answer your call for results. Then what would you do? Would you still financially support them? In other cases, they might not even know what results you are really asking for. They therefore supply you with a bunch of statistics that address many areas, but do not answer the bottom line question, which is how many clients were successful at meeting what their mission promises.
When friends ask you to give to their favourite causes, do you ask for any information on the success of that charity or do you give because it is a friend? Yes, I agree this area is very tricky so why not start your own trend of expectations? When you ask others to give to your favourite charity, supply them with a basic fact sheet outlining some efficiency measures and effectiveness measures. Follow up with your friends six months to a year later with some results and see how that makes everyone feel. Change the way social asks are made and hope that others follow suit, but if not, don't be afraid to ask for more information.
Something to think about!
Labels: accountability, donors, individual giving, measures, results
Corporate giving
Corporate giving can create some tricky situations if you are a public company. Some shareholders feel that this money should go to them, not to charities and it is up to the individual shareholder to give money if he/she chooses, but not the company.
These days, there is what's called strategic philanthropy. Strategic philanthropy can be implemented in various ways, but for corporations it could mean aligning your donations with some of your corporate strategies. For example, let's say you wanted to tap into the Asian market. Then you could find out what issues the Asian market has for that time in that area and see if you can find a charity to help resolve the issue. You fund the charity. The charity develops and implements the project with your name on the information and the Asian market benefits. The hope is that this new consumer thinks of your company when they want to buy a particular product. Of course, this assumes the corporation has done all the right research on the issues, the charity, and the materials/tools that were used. If any one of those areas are performed poorly, then the overall win- win to everyone is heavily compromised.
I have seen corporations donate thousands of dollars to causes without doing any research. The result is that the corporations haven't found the right issue and all the materials aren't used or the corporation may also give to a worthy cause, but so have many others so there is a lot of clutter and too much money in one cause. No one corporation stands out. Although, this is not a marketing expense, there needs to be some mention of the corporation's name in a way that makes the corporation stand out from others. On top of that, charities need to show effectiveness and effciency so that shareholders can see that corporate dollars were accounted for both financially and in client performance.
Corporate giving is no longer about just giving to the community through various charities and then receiving a tax receipt. Corporations need to look at charitable giving as a way to align their giving with their other departments to receive some benefit. If not, then corporations will cut the donations in hard times. It has taken a long time for marketing executives to persuade most businesses not to cut their advertising budgets during hard times. They could only do this because they were able to show a strong business case as to why they should keep advertising. Corporate shareholders must also see this strong case to justify why money should go to charities instead of going to them or back into the operations.
Something to think about...
Labels: corporate giving, donations, strategic philanthropy
Donor giving series
This year I have re-introduced my previous business, Donations Management. Donations Management is established to help corporations, foundations and high-end donors manage their donations to create more meaningful and measurable impacts. GET RESULTS!!
For the next few weeks, I will be blogging about some areas for donors to think about before they make substantial investments. The intent of this series is to get donors and charities to think differently. My overall end goal is to have more end recipients succeed. There is no greater emotional experience, to me, than to see people achieving their goals.
Okay, let's begin. What exactly does impact mean? When we talk about impact, there seems to be a few ways of explaining it. I define impact as focusing on the end result so for the majority of donors that means financial impacts and client impacts . For this blog, we will focus on financial and client impacts.
How well did the charity manage a donor's gift? Did most of the money go towards programming? Financial impacts tend to focus on efficiency measures that try to answer those questions such as % of administrative and or fundraising costs relative to total expenses or to total fundraising dollars raised or programming costs per client. When donors assess the financial statements, they want to know if the charity invested in helping more end recipients succeed or did they help more internal staff get bonuses for their fundraising skills? That sounds cynical, but unfortunately, donors are watching as these fundraising costs are in many cases skyrocketing. Donors want to see more money going to programming. The more money going towards programming, the greater the potential for more clients to succeed. I say potential. This leads me to the next area of impact - client impact.
I think the most powerful area of measurement is that of client impact which can be measured in terms of effectiveness. To me, that is basically checking to see how many of the charity's clients succeeded or how many clients achieved what the charity promised they would achieve. That promise should be clearly defined within the mission. That promise can also be called an outcome depending upon how well you have defined it. I think measuring client impact is the most important area. As I have mentioned in other articles, I believe that the bottom-line for the non-profit sector is not financial solvency, although that is vital, but rather client success. For too long, charities have not had to be accountable for client success. That needs to change if communities want to truly see less poverty, better education, and higher quality health care.
Something to think about...
Labels: donor, donor giving, donor help, donor impact
