I was recently in Las Vegas. I was there to see Keys to Tall Buildings, a play written by Lloyd Noonan (http://twitter.com/lloydnoonan), a former development professional turned playwright. In my friend’s darkly comic play, the hero (or anti-hero, depending on your point of view) kills “bad” people. The initial twist is that the “bad” people have committed only minor offenses such as failing to properly sort recyclables and trash at the Whole Foods Market. The second twist comes when we learn that those responsible for minor offenses are also guilty of terrible crimes. Oddly, this got me thinking about the impact of stewardship on the philanthropic process. Allow me to explain.
Most donors to nonprofit organizations make modest donations, at least initially. Even people of great means make modest contributions. For example, I did an analysis for one large charity and found that over one-third of their donors of $5,000 or more made an initial gift of $100 or less. In other words, as many modest donors gained confidence in the organization, they increased their giving. One way this organization earned the confidence of donors, and their increased support, was with effective stewardship.
Consciously or subconsciously, donors often test nonprofit organizations. They seldom start the relationship by making the largest possible gift. Instead, donors want to see if the organization uses their money responsibly. They want to see the impact of their giving. They want to know that the organization appreciates their support. Good stewardship will help donors answer the questions they have about the charity. Effective stewardship will also set the stage for the next ask. The better the stewardship, the better the outcome of that ask.
Unfortunately, some organizations have decided to cut corners during these economically tough times. Some view stewardship activities as expendable. These organizations are bound to pay a serious price in the months and years ahead.
Lloyd Noonan
In Noonan’s play, those who committed minor offenses were also guilty of serious crimes. Donors to nonprofit organizations assume that a charity that commits minor stewardship gaffes is or will be guilty of committing major offenses down the line. If you mistreat a donor or their gift today, how can they trust you with another gift? This is a particularly serious matter where planned giving is concerned. If you do not take good care of your donor and her money while she is still alive and looking over your shoulder, how can she trust you to properly steward her gift when she is no longer here? The donor’s assumption will always be the worst case scenario.
Conversely, if you properly steward donors and their gifts, your organization will reap significant benefits. Here’s what H. Gerry Lenfest, entrepreneur and philanthropist member of The Giving Pledge says about stewardship, “Once gifts are secured, it is also essential that institutions find creative ways to ‘credit’ and celebrate each planned gift donor. Remember, any planned gift donor is a ‘major gift’ donor. Those of us who make planned gifts do not expect, nor do we want, lavish thank-you presents or excessive recognition. However, we do want to know that the organizations we support appreciate our philanthropy and will use our gift in the way we intend. So, do not make the mistake of forgetting about us once you receive our gift commitment. We may truly appreciate how efficiently and effectively you handle contributed funds so much that we entrust you with another planned gift. We are also in a position to influence others to do the same.”
To ensure the success of your development program, make sure you have a highly effective stewardship program in place. Be sure donor gifts are used according to donor wishes. Be sure to report to donors about the impact of their gifts. Be sure to appropriately and creatively recognize donors. Commit to seriously investing in stewardship.
That’s what Michael Rosen Says… What do you say? How do you recognize your donors? What kind of information do you share with donors? Is your organization investing more or less in stewardship this year compared to last?
Michael Rosen Says... 