Special Report: America’s 50 Worst Charities Named

A collaboration between the Tampa Bay Times, CNN, and The Center for Investigative Reporting has resulted in a list of “America’s Worst Charities.” In addition to producing a list of the 50 worst charities, the report analyzes the activities of the charities.  

The report found that $1.4 billion in donations went to the 50 worst charities over the past 10 years. Of that, $970.6 million went to paid solicitors while $380.3 million went to charities. However, a scant $49.1 million went to direct aid.

In other words, the investigation found that just 3.5 percent of donations to the 50 worst charities went to services fulfilling charitable mission.

Watchdog groups say that no more than 35 percent of donations should go to fundraising expenses. Among the 50 worst charities, 69 percent of donations were spent on professional solicitation companies alone!

The report accuses some of the 50 worst charities of lying to donors about how their donations will be used, employing executives who take multiple salaries and/or who are also paid as consultants, contracting with outside fundraising companies owned by friends, family members, or the executives themselves. The report even accuses some of the 50 worst charities of using “accounting tricks” to inflate the value of the charitable work they are doing.

When Opportunity Knocks, Open the Door!

A pessimist is somebody who complains about the noise when opportunity knocks.”

– Oscar Wilde, poet and playwright

“Even when opportunity knocks, a [person] still has to get up off his seat and open the door.”

– Anonymous

“Opportunity knocks at the strangest times. It’s not the time that matters but how you answer the door.”

– Steve Gray, prominent New Zealand television presenter

 

Most nonprofit organizations attempt to woo donors and prospective supporters in a variety of ways. Wise nonprofit organizations seize the chance to woo donors and prospective supporters in fresh ways when the opportunity presents itself. The challenge is that those opportunities are not always obvious. Sometimes, the wooing of donors and prospects might be an unexpected, happy side-effect of simply seizing the opportunity to do something good.

The latter was the case for the Philadelphia Orchestra during its recent 40th anniversary residency and tour of China.

The Orchestra was the United States’ first cultural ambassador to China in 1973. During the anniversary trip, the Orchestra performed in venues ranging from acclaimed concert halls to elementary schools. In addition to its own performance schedule, the Philadelphia Orchestra performed in joint concerts with local orchestras. Besides performing, the Orchestra also participated in a number of coaching sessions.

The Orchestra’s anniversary trip generated positive publicity in Philadelphia and rave reviews in China. The Orchestra’s journey was a source of pride for Philadelphia’s classical music fans, myself included, who saw the organization emerge from Chapter 11 bankruptcy protection less than a year ago.

However, as you might expect, not everything on the trip went according to plan. Toward the end of the tour, a group of musicians and administrators took an early-bird flight from Beijing to Macau. Unfortunately, bad weather trapped the plane on the tarmac for several hours.

Most of us would have seen the delay as an opportunity to complain, read, play on an iPad, or make phone calls. However, the Orchestra folks had another idea. They seized the opportunity to do something good for all of the trapped passengers. Without thought, I suspect, to how it would play to the outside world, the Orchestra folks offered to perform a pop-up concert. Four members of the Orchestra’s string section unpacked their instruments and performed Dvorak’s String Quartet No. 12, subtitled “American.”

Click to watch video of Philadelphia Orchestra pop-up concert on airplane in China.

You can hear Juliette Kang on violin, Daniel Han on violin, Che-Hung Chen on viola, and Yumi Kendall on cello by streaming the video here. As you can hear from the applause and cheers, the passengers on the plane greatly appreciated the surprise mini-concert.

The Orchestra had done a good deed by spreading a bit of joy at an uncomfortable time. If that were all that the musicians achieved, it would have been enough. However, the Orchestra ended up unexpectedly achieving far more.

With so many smart-phones on board, it was inevitable that videos would be posted on the Internet. The Philadelphia Inquirer reported on the event. But, the publicity reached far further. NPR, The Huffington Post, and other media picked up the story. Moreover, as of this posting, nearly two million people from around the world have watched the videos!

Special Report: Fidelity Charitable Provides Insights about DAF Donors

Fidelity Charitable, an independent public charity that sponsors the largest Donor-Advised Fund program in the US, has issued a new report, Fidelity Charitable Giving Report 2013: A Look at Fidelity Charitable Donors, Who They Are and How They Give.

The report provides fundraising professionals with insights that can help them better tap into the DAFs of their supporters and potential supporters.

Here are some factoids from the report:

Fidelity Charitable has over 94,000 donors connected to more than 57,000 giving accounts.

The average age when a donor establishes a DAF at Fidelity Charitable is 54.

The median Fidelity Charitable giving account balance is $14,450.

Nearly 40 percent of Fidelity Charitable donors have maintained a giving account for more than 10 years.

Over 54 percent of contributions to Fidelity Charitable giving accounts were in the form of public or private securities in 2012.

The average number of grants from Fidelity Charitable giving accounts numbered just over seven in 2012.

The average grant from a Fidelity Charitable giving account was nearly $3,800 in 2012.

Special Report: IRS Scandal Shakes Washington

This week, the US Internal Revenue Service acknowledged and apologized for behavior that had long been rumored. The IRS improperly targeted for extra scrutiny conservative groups seeking tax-exempt status.

The IRS did not ultimately deny tax-exempt status to a single group receiving extra scrutiny. Some say this proves that the actions of the IRS were baseless.

The scandal has now shaken the nation’s capital:

President Barack Obama directed Jack Lew, Secretary of the Treasury, to request the resignation of Steven Miller, Acting IRS Commissioner.

Miller resigned and Lew accepted the resignation.

The Justice Department has initiated a criminal investigation.

Exercising its oversight responsibility, Congress has begun its own probe of the IRS scandal.

Obama addressed the nation on television saying, “It’s inexcusable and Americans are right to be angry about it and I am angry about it. I will not tolerate this kind of behavior in any agency, but particularly the IRS given the power that it has and the reach that it has in all of our lives.” He promised reforms.

When wrongdoing by the government is uncovered, it is rightfully news. But, this latest government scandal cuts deeper.

And Now for Something Completely Different

This blog post is a departure from my normal articles. It’s not about nonprofit management. It’s not about fundraising.

Despite the departure from my normally chosen subjects and my homage to Monty Python in the headline, this post is still about something quite serious that should concern you.

With this piece, I’m continuing a tradition here at Michael Rosen Says… April is National Child Abuse Prevention Month in the US.

Every April, I devote one posting to how we all can and must act to prevent child sex abuse. Whether or not you have children, there are things you can and should do.

Did you know that one in four girls and one in six boys will be sexually abused by the time they are 18 years old, according to the Centers for Disease Control?

Did you know that the vast majority of these child victims will be sexually abused by someone they know?

If you have children, here are three things you can do to help keep them safe:

1. Don’t rely on “stranger-danger.” Teaching children to avoid strangers or never to talk to a stranger will do little to keep them safe from sexual predators. Child sex abuse is a crime of opportunity. That’s why the vast majority of child sex abuse cases involve someone the child knows (i.e.: a priest, coach, teacher, babysitter, mom’s boyfriend, etc.).

While it is important to teach your children to be cautious with strangers, you should also closely monitor with whom your child has alone-time. You should minimize the number of times your child is alone with only one adult present. I recognize this will be difficult. For example, if you hire a babysitter, that person will have hours alone with your child. But, you can still protect your child by doing a thorough background check and by installing nanny cams in your home.

2. Respect your child’s personal space. Very often, a mom or dad will say something like this to their child: “Go give grandma a hug and kiss.” If the child refuses, the parent or the intended kiss recipient will become increasingly pleading and/or demanding. While perfectly innocent and seemingly harmless, this teaches children a dangerous lesson: Their body is not theirs to control.

Instead, respect your child’s personal boundaries. Let them know it’s okay for them to pick and choose with whom they will have physical contact. Don’t inadvertently send them the message that adults have power over them when it comes to contact. Make sure they understand they can say no to adults.

3. Read these prior posts. I’ve written two other posts about the prevention of child sex abuse: “10 Essential Tips to Protect Children from Real Monsters” and “National Child Abuse Prevention Month: What are You Doing to Help?”

When you read my prior posts, you’ll find more powerful tips as well as the names of organizations you can contact for more information or assistance.

If you do not have children, or even if you do, here are some additional things you can do:

Special Report: Senate Passes Budget Resolution, Charitable Deduction in Danger

Days ago, the US Senate passed the Senate Budget Resolution by a vote of 50-49 with one senator not voting. During the deliberations leading up to the vote, the Senate refused to consider an amendment offered by Sen. Roy Blunt (R-MO) and Sen. John Thune (R-SD). That amendment would have protected the charitable deduction.

When the House and the Senate come together to reconcile their budget proposals, one of the items they will likely discuss is whether to preserve, restrict, or eliminate the tax deduction for charitable giving.

Special Report: PPPGP Recognizes Michael J. Rosen

The Partnership for Philanthropic Planning of Greater Philadelphia has recognized Michael J. Rosen, CFRE for his board service. Allen F. Thomas, JD, CFRE, CAP, President of PPPGP, presented Rosen with a certificate during PPPGP’s March 22, 2013 luncheon program.

Michael Rosen (left) receives recognition certificate from Allen Thomas.

Rosen, the President of ML Innovations, served on the PPPGP board from 2007 through 2012. During that time, he held a variety of positions including Chair of the Programming Committee, Vice President, President, and Immediate Past President.

During his tenure, PPPGP achieved a great deal despite the challenging economic situation. PPPGP’s annual conference saw a 33 percent increase in attendance. The number of members set a new record high. The budget was balanced and the cash reserve was enhanced while PPPGP held the line on costs to its members. Additional programs were initiated including roundtable meetings and a nationally recognized two-day fundamentals of planned giving workshop. 

PPPGP also added networking opportunities and a mentoring program. The organization also enhanced its website to include a jobs board and a regular ethics column. PPPGP also created the Legacy Award for Planned Giving Philanthropist of the Year. In addition, the organization changed its name from the Planned Giving Council of Greater Philadelphia to the Partnership for Philanthropic Planning of Greater Philadelphia to be more inclusive and more representative of the philanthropic planning process.

Pope Francis Gets It. Do You?

I know that you may be wondering, “Why is a nice, Jewish guy writing about the Pope?”

Pope Francis greets the public.

Let me explain.

First, I believe that we all can learn something — sometimes, many things — from anyone.

Second, Pope Francis clearly understands branding, managing one’s image, living one’s mission, communicating effectively, engaging others, and maintaining a good sense of humor.

While the new Pope can certainly teach any number of lessons about religion and morality, I want to focus on what nonprofit managers and development professionals can learn from the new Pontiff.

Here are six things you can learn from Pope Francis that will help you do a more effective job for your nonprofit organization:

Know Your Brand. Pope Francis understands his brand. He is a Jesuit priest. The Order’s founding document, written by Ignatius of Loyola, calls on all Jesuits to take a vow of perpetual chastity, poverty and obedience. Through his lifestyle, public remarks, and image, the Pope has demonstrated his commitment to the principles outlined by the founder of the Society of Jesus (the religious order known as Jesuits).

Effective nonprofit managers and development professionals know they must carefully craft and manage their institutional and personal brands. We must have a mission, understand the mission and be able to convey that understanding to others.

Live Your Brand. Long before being elected the leader of the world’s 1.2 billion Catholics, Pope Francis lived his brand. For example, as a Cardinal in Argentina, he lived in a modest apartment rather than the more elegant, suburban Bishop’s residence. He used public transportation to get around. He cooked his own meals. In other words, he did not simply create a superficial public image. He created and lived a lifestyle. He lived authentically.

His authenticity continues. After the conclave elected him Pope, he took the name of Francis of Assisi explaining it this way, according to The New Yorker:

I will tell you the story. During the election, I was seated next to the Archbishop Emeritus of São Paolo and Prefect Emeritus of the Congregation for the Clergy, Cardinal Cláudio Hummes—a good friend, a good friend! When things were looking dangerous, he encouraged me. And when the votes reached two-thirds, there was the usual applause, because the Pope had been elected. And he gave me a hug and a kiss, and said, ‘Don’t forget the poor!’ And those words came to me: the poor, the poor. Then, right away, thinking of the poor, I thought of Francis of Assisi.”

Later, Pope Francis returned to his hotel to checkout of his room. He chose to take the bus rather than the Papal car. He was the new Pope, but he was also still the priest who rides the bus.

Nonprofit managers and development professionals must be authentic. We need to be true to brand identity and mission. It is not enough simply to pretend to be a certain way. Authenticity earns the public trust that generates and maintains support.

For example, there are charities that efficiently use donated funds to achieve their missions. However, there are also nonprofits or non-governmental organizations that squander contributed resources while still others are simply scams. On the surface, all may appear worthy of support. In reality, the authentic charities that operate with integrity are best positioned for long-term success on all fronts.

Manage Your Image. When addressing the public, Pope Francis reportedly ignored prepared remarks written by his would-be handlers. Instead, he spoke for himself, off the cuff. For example, he spoke of his desire for “a church that is poor and for the poor.” Beyond choosing his own words, the new Pope also chose to wear a plain white cassock instead of formal Papal robes. When first introduced to the public, he wore a simple wooden cross rather than a gold one such as those worn by his predecessors.

Nonprofit managers and development professionals need to carefully manage their own image as well as the image of their organization. Leaving our images to chance simply puts our organizations and us at risk. We must exert effort to effectively and appropriately manage our images and those of our organizations. It’s part of a sound communications strategy. Remember the old adage, “A picture is worth a thousand words.”

Do You Know How to Navigate in the Gray Area?

I recently published a post about how City of Hope plans to host a special fundraising event at odds with the organization’s mission. Most readers who responded to a poll at the end of the post felt the event is inappropriate with many even finding the event unethical.

The unscientific poll reveals that 49 percent of respondents feel that the “Let Them Eat Cake” event is “Inappropriate but Not Unethical,” 27 percent say the event is “Unethical & Inappropriate,” 13 percent say the event is a “Great Idea All Around,” and 10 percent believe the event is “Appropriate, Whether on Mission or Not.”

I’m comforted to know that over three-quarters of the respondents feel the same way as I do about the City of Hope event. However, some of the comments I’ve received on this blog site, on LinkedIn, and via email concern me a bit.

Perhaps the comments are a result of how I worded the post or phrased the poll responses. Some people seem to be under the impression that one’s actions are either purely ethical or purely unethical. In certain cases, those folks would be correct. Some actions are clearly ethical or not. Stealing money from Girl Scouts selling cookies (this really happened) is clearly unethical.

However, not all situations are black and white, ethical or unethical.

While the legality or illegality of an action is certainly a guideline, such as the theft incident I just described, something can be unethical without being illegal. Some situations in which we find ourselves put us into a gray area. The most challenging ethical dilemmas often involve situations that are not black and white. If they didn’t, they really wouldn’t be dilemmas, would they?

When considering the possible, multiple responses to a situation, we will often find some alternatives are more ethical while some are less ethical. In the case of City of Hope, the organization could choose to continue to host its “Let Them Eat Cake” event without any changes although many readers found it at odds with the nonprofit’s mission and, therefore, unethical. Alternatively, the organization could choose not do any event.

However, the organization has other options. For example, City of Hope can run its cake event but offer healthy alternatives and educational material as well. Or, the organization could host a different event like the Healthy Chef Competition in Vancouver, Canada that Rory Green, a development professional and blogger, told me about.

Again, some alternative courses of action are more ethical or less ethical than others. The objective should be to always choose the best option, make the best decision.

The most challenging ethical dilemmas of all, however, do not have any good, ethical solution. They’re no-win situations. Think of the novel/movie Sophie’s Choice or the “Kobayashi Maru” test from the film Star Trek II: The Wrath of Khan. Even in these no-win situations, we must cope as best as we can to be the best we can.

As those who work in the nonprofit sector, we must understand that our greatest asset is the trust of the public. The more trust people have in charities, the more likely they are to donate. And, with greater trust comes larger contributions.

Special Report: Charitable Giving Deduction in the Crosshairs, Again

The US Senate Budget Committee has just released its FY 2014 Budget Resolution. On pages 65 and 66, the Democratic-controlled Committee asserts that the wealthy are unfairly benefiting from “tax expenditures.”

The Budget Committee calls on the Senate Finance Committee to reduce the deficit by limiting or reforming “unfair” tax breaks for the wealthy. The Committee specifically mentions itemized deductions with various options listed for limiting them (i.e.: a percentage cap, hard dollar cap, etc.). The charitable deduction is not exempted from these various proposals.

The Obama Administration has previously floated a similar proposal. You can read my analysis of that in my post: “Obama Plan Could Cost Nonprofit Sector $5.6 Billion a Year.” In short, limiting or eliminating the tax deduction for charitable giving is expected to have a significant, negative impact on giving.