Archive for ‘Current Events’

April 16, 2018

Are Donors the Hidden Enemies of Charities?

Donors are not usually the enemies of nonprofit organizations. Instead, they are the friends who provide much needed resources allowing charities to save lives and enhance the quality of those lives.

However, some donors at some times do become the enemy of the good. They behave in ways that humiliate and, at times, even endanger those with less power. That’s one of the disturbing findings of a new survey report sponsored by the Association of Fundraising Professionals and The Chronicle of Philanthropy and produced by Harris Polling.

Among nonprofit professionals surveyed, 25 percent of women and 7 percent of men say they have been sexually harassed. Of the harassment incidents cited, 65 percent of the perpetrators were donors with the balance being colleagues, work supervisors, and organization executives. Harassers are most often men (96 percent). The median number of sexual harassment occurrences personally experienced by survey respondents is three (which is why some of the statistics in the report add up the way they do).

“Harassment is always about power, so the results here might indicate that the real power in these organizations rests with the donors,” Jerry Carbo, a professor at Shippensburg University who served on a federal committee studying harassment in the workplace in 2015 and 2016, told The Chronicle. “I would normally expect to see a much higher response rate for supervisors.”

The most common types of sexual harassment experienced in the fundraising profession include: inappropriate comments of a sexual nature (80 percent), unwelcome sexual advances and requests for sexual favors (62 percent), and unwanted touching or physical contact (55 percent).

Mike Geiger, MBA, CPA, President and CEO of AFP, commented on the alarming findings:

The number of cases involving donors is eye-opening and points to a unique and very troubling situation within the profession. As we look at how to proceed with the data from the survey and begin developing anti-harassment education and training for fundraisers and others in the charitable sector, we will have a special focus on the all-important donor-fundraiser relationship. We know most donors have only the best interest of the cause at heart, but our message will be clear: no donation and no donor is worth taking away an individual’s respect and self-worth and turning a blind eye to harassment.”

Sadly, many nonprofit organizations fail to take appropriate action when they receive reports of sexual harassment, regardless of whether the perpetrators were donors or fellow staff. Consider the following:

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April 13, 2018

Why are Fundraising Results Missing the Mark?

The nonprofit sector has an unfortunate secret. While not a well-kept secret, it is nevertheless something that receives too little attention. So, let’s take a moment to shine a spotlight on the issue.

Overall, American philanthropy has remained at approximately two percent of Gross Domestic Product for over six decades, with the percentage bouncing between 1.6 and 2.3 percent, according to Giving USA. Every year when the amount of money donated to charities goes up, the nonprofit sector pats itself on the back even though it is merely keeping pace with GDP.

Despite the massive growth in the number of nonprofit organizations, the significant increase in availability of educational materials, the production of helpful research, the professionalization of the fundraising field, and the rise of new technologies, the nonprofit sector has failed to budge philanthropy relative to GDP.

Now, as a committee convened by The Giving Institute begins to consider ways to grow philanthropy beyond the two-percent-of-GDP mark, I’ve written an article for the Association of Fundraising Professionals magazine, Advancing Philanthropy, that explores the challenge: “What Will It Take to Dramatically Increase Philanthropy?”

To answer that question, we need to understand how and why past attempts to do so have come up short, such as the insightful work of the Commission on Private Philanthropy and Public Needs in the 1970s.

We also need to understand the broad societal cultural factors that are affecting philanthropy so that we can develop strategies for inspiring cultural change and/or adapt to factors beyond our control (e.g., decline in religious affiliation, erosion of social capital, drop in volunteerism, etc.). Furthermore, we need to understand the cultural issues within the nonprofit sector that block change and, ultimately, greater success.

We also must set a realistic, consensus goal for moving the philanthropic needle. While that goal should be bold, it should also be based on something other than a dream. A credible target mark will give us all something to shoot for.

As Henry David Thoreau once wrote:

In the long-run, [people] hit only what they aim at.”

While it will likely take at least a couple of years for The Giving Institute’s commission to do its work, you and I do not need to wait. There are things we can do now to begin to move closer to a more vital philanthropic mark, something greater than two percent of GDP:

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April 8, 2018

Do You Really Have What It Takes to be a Successful Fundraising Professional?

If you want to be a successful fundraising professional, you need to constantly expand your knowledge and develop your skills. Great fundraisers are not born. They are created through hard work and dedication.

However, if you want to be a truly successful fundraising professional, you’ll need more than knowledge and skills. You need passion. You need passion for the profession, your organization’s mission, and for improving society.

One way to supercharge (or recharge) your passion is to remember what first attracted to the fundraising profession or what first inspired you to make a charitable donation. In my case, both are wrapped in the same tale. Here’s my story:

Little Michael at age 8.

My passion for fundraising and philanthropy began when I was eight years old. You see, I wanted my parents to buy me some comic books. My mother said that she would get me any ‘‘real’’ book I wanted but, if I wanted comic books, I would have to spend my allowance. Well, in those days, an allowance was not an entitlement; I had to earn it by doing household chores. Sadly, I was already at my maximum earning capacity. And I had no more money for the latest edition of Superman.

Because I simply had to have the latest Superman comic book, I asked my mother if I could sell my old comic books and open up a lemonade stand to generate some quick cash. Fortunately, she granted her permission.

My first entrepreneurial effort was a terrific success. I generated what in today’s dollars would be about $150. As an eight-year-old kid, I was rich! Recognizing that I did not need to buy quite that many comic books, my mother suggested I give half of it away to charity. She further said that, if I agreed with her suggestion, I could pick whatever charity I wanted.

At the time, our local newspaper operated a fund to send “poor inner-city” kids to summer recreational camp. I grew up in the suburbs. However, my cousin grew up in the big city. I knew how miserable summertime in the city could be for a kid. I knew how good I had it, even with our meager working-class lifestyle. I wanted other kids to enjoy the clean air and open spaces that I enjoyed. So, I took my coffee can with half of my earnings and marched into that local newsroom.

The editor was so moved that he had my picture taken and put me on the front page! My little eight-year-old ego swelled. I was inspired for each of the next several summers to run a front-yard fair for that summer camp fund. The only changes were that I gave 100 percent of the revenue to the charity and the event got bigger each year. It even inspired similar efforts in other neighborhoods.

I can trace the roots of both careers I have had in my adult life — journalism and development — back to that little boy’s experience. I learned a great deal about fundraising in those days, especially about what it takes to inspire donors to support a good cause. I also learned how good it feels to be philanthropic.

Philanthropy is a learned behavior. At MarketWatch, Kari Paul’s article “Want Your Children to be Charitable? Do This” opens with this sentence:

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March 14, 2018

Is Online #Fundraising Really Worth Your Time?

For years, nonprofit organizations have invested significant amounts of time and money to build online fundraising efforts that have steadily evolved to embrace more and more sophisticated technologies and methods. But, are those efforts really worthwhile?

The Blackbaud Institute’s recently released Charitable Giving Report: How Fundraising Performed in 2017 can help us answer that question.

The news about overall philanthropy in 2017 is good. Blackbaud reports:

A convergence of economic, political, technological, and philanthropic trends helped boost giving in 2017. The 4.1% increase in giving during 2017 was a substantial jump compared to relatively flat growth in 2016. A strong stock market, spikes in giving in response to political issues or disasters, and the continued shift to digital giving all influenced giving in 2017. This growth was also fueled by a 5.1% increase in giving during the final three months of 2017. The potential implications of new U.S. tax laws may have contributed to this late surge in charitable giving.”

The news about online giving is also good. Blackbaud has found:

  • 7.6% of overall fundraising revenue, excluding grants, was raised online representing a new record high.
  • Online giving grew 12.1% in 2017 compared to 2016.
  • 21% of online transactions were made using a mobile device in 2017.
  • The average online donation is $132.
  • 20.1% of online giving happened in December.

Online is an important source of donations for nonprofit organizations of every size as the following chart illustrates:

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March 8, 2018

Update: Is the Nonprofit Sector Ignoring the #TimesUp Movement?

I’m surprised. You might be, too.

At the end of last month, I published the post “#TimesUp Alert: Nonprofit Organizations are Not Immune.” The post is one of my least read articles so far this year. By comparison, several old posts that I have not promoted for a long time have attracted far more readers during the past week. Given the seriousness of workplace sexual harassment and assault, I am disappointed that my post on the subject has not received more attention.

Please don’t misunderstand me. I’m not whining. I’m simply concerned that an important, timely issue facing the nonprofit sector is apparently of little interest to fundraising professionals and nonprofit managers.

Why do you think my previous #TimesUp post has attracted so few readers?

It could be that folks do not believe it’s really a significant issue for the nonprofit sector; after all, we do good so we must be good. Or, it could be that nonprofit professionals don’t believe they have the power to bring change to their organizations, so they don’t bother thinking about it. Or, it could be something else. What do you think?

Interestingly, the percentage of post readers who responded to my one-question anonymous survey was above average. While the broader universe of potential readers might not have been interested in the article, those who did read the piece were highly engaged.

The poll was admittedly unscientific. Nevertheless, I owe it to those who responded to share the results:

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February 27, 2018

#TimesUp Alert: Nonprofit Organizations are Not Immune

The nonprofit and philanthropic communities are not immune. We must face a sad truth: Sexual harassment and assault do not exist exclusively in Hollywood or even just the broader for-profit sector. The problems also fester in the nonprofit and philanthropic sphere. The issue is so serious for the nonprofit sector that the Association of Fundraising Professionals has recently issued a clear statement and planned steps to address the situation.

The victims of Harvey Weinstein made the world aware, in 2017, of the Hollywood movie mogul’s alleged despicable acts of sexual harassment and assault. The revelations led to the #MeToo social media movement that put the spotlight on other alleged perpetrators in the film and other industries.

As the year ended, the #MeToo movement evolved into the #TimesUp initiative. Megan Garber, writing in The Atlantic, described the transition this way:

The simple shift in hashtag, #MeToo to #TimesUp, is telling: While the former has, thus far, largely emphasized the personal and the anecdotal, #TimesUp — objective in subject, inclusive of verb, suggestive of action — embraces the political. It attempts to expand the fight against sexual harassment, and the workplace inequality that has allowed it to flourish for so long, beyond the realm of the individual story, the individual reality.”

The #TimesUp Legal Defense Fund, part of the new movement, set an initial $15 million goal, now $22 million. As of this writing, over $21 million has been raised from nearly 20,000 donors through GoFundMe.

Within the nonprofit sector, it’s easy for us to have a false sense of comfort. Some may believe others are addressing the problem adequately. Others may believe the problem is not that widespread among nonprofits because they are inherently good because they do good.

Unfortunately, there is ample anecdotal and statistical evidence demonstrating that the nonprofit sector faces the same situation as the rest of society when it comes to sexual exploitation, harassment, and assault. Wherever some people hold power over others, the door is open to sexual harassment and assault.

Consider just a few examples:

The Presidents Club. Over the years, this organization has raised over 20 million British pounds for various children’s charities in the UK. The cornerstone fundraising activity of this UK-based charity has been an annual gala for over 300 figures from British business, finance, and politics. On January 18, the group gathered at the prestigious Dorchester Hotel in London where they were joined by 130 hostesses.

A Financial Times investigative report found:

All of the women were told to wear skimpy black outfits with matching underwear and high heels. At an after-party many hostesses — some of them students earning extra cash — were groped, sexually harassed and propositioned.”

I can’t do this story justice. Please take a few moments to read the full Financial Times article. It’s stunning. Since the report was published, The Presidents Club has ceased operations.

Oxfam. Large international charities are not immune to scandal either. Oxfam officials this month released the findings of an internal investigation that found its country director for Haiti hired “prostitutes” during a relief mission in 2011. Furthermore, in 2016 and 2017, Oxfam dealt with 87 sexual exploitation cases as well as sexual harassment or assault of staff, according to a report in Devex. While the Haiti country director has resigned and Oxfam has taken steps to avoid exploitation and harassment in the future, the negative public relations and philanthropic fallout have been significant.

Humane Society of the United States. Wayne Pacelle, Chief Executive Officer of the Humane Society, resigned following sexual harassment charges filed against him, according to The New York Times. While Pacelle maintains his innocence, he also faced allegations of sexual relationships with subordinates, donors, and volunteers going back years.

While the anecdotes are alarming, they don’t really help us understand how vast the problem is. So, let’s look at the numbers. In the USA, nearly 1200 sexual-harassment claims were filed with the Equal Employment Opportunity Commission against nonprofit organizations between 1995 and 2016, according to a report in The Chronicle of Philanthropy. While a significant number, it likely only reflects a modest percentage of actual cases, most of which go unreported or are only reported internally.

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February 22, 2018

What do Abraham Lincoln and Jennifer Lawrence have in Common?

President Abraham Lincoln and actress Jennifer Lawrence each learned something that can help your fundraising efforts. Before I tell you what that is, let me share a bit of history with you.

Earlier this week, the USA celebrated Presidents Day. Congress originally established the Federal holiday to commemorate the birth of George Washington, the nation’s first President, born on Feb. 22, 1732. At some point, the holiday also began to include Lincoln, born on Feb. 12, 1809. Then, all of the US Presidents were lumped into the holiday. Well, sort of. Despite its commonly excepted name — Presidents Day — it remains officially Washington’s Birthday.

To honor a President this week, I thought I’d share some wisdom from one of them. Then, as I was preparing to write this piece, I stumbled upon an article about Lawrence, and realized she has learned the same lesson as Lincoln.

Paraphrasing 15th century poet John Lydgate, Lincoln is believed to have stated:

You can please some of the people some of the time, all of the people some of the time, some of the people all of the time, but you can never please all of the people all of the time.”

Lawrence, definitely in a different league than Lincoln, has nevertheless learned the same lesson. While she likely had this insight well before this year’s British Academy of Film and Television Awards, she had a reminder of it resulting from an interview hosted by Joanna Lumley.

Lumley introduced Lawrence by saying, “And we start with the award for Outstanding British Film and who better to kick the whole evening off than the hottest actress on the planet? Soon to be seen in ‘Red Sparrow,’ it’s the ravishing Jennifer Lawrence.” The American actress then came out and modestly said, “Hi. That was a bit much, but thank you, Joanna.”

Following the exchange, the social media battle began. Some people thought that Lawrence was being “discourteous,” “a spoiled brat,” “rude,” and more. On the other side, there were plenty of people who sided with the actress with one even questioning, “How is that rude?”

Lincoln Memorial

Yes, you can never please all of the people all of the time.

That’s an important lesson for all of us.

Your fundraising plan will not make everyone happy. Your direct mail copy will not make everyone happy. The graphic design for your annual report will not make everyone happy.

At some point in your career, likely far more than once, you’ll hear, “We can’t do that here. We’ve never done it that way.” You might even have someone in upper management comment negatively on your direct-mail appeal because it’s not how she would write a letter to a friend — “Do you really need to use bullets and boldface?”

You get the idea.

You just need to understand that you will never make everyone happy all of the time. When confronted by senseless criticism based on emotion rather than knowledge, keep these five points in mind:

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February 6, 2018

We All We Got. We All We Need.

How would you like to be a champion fundraising professional?

It’s simple. Not easy, but simple.

The Super Bowl LII Champion Philadelphia Eagles provide us with a great example of what it takes to be the best in any profession. While Eagles safety Malcolm Jenkins — he’s also an entrepreneur and philanthropist — didn’t originate the sentiment, he articulated a statement that became a team slogan and nicely sums up the champion creed:

We all we got. We all we need.”

Let me explain.

To succeed, we need to recognize that all we truly can depend on is our team and ourselves. Furthermore, that’s often enough. More specifically, in the fundraising world, here’s what it means:

Build a strong team. Hire, or encourage your organization to hire, talented staff who believe passionately in the organization’s mission. Such people will almost always enjoy greater fundraising success than a hired mercenary who only wants a job and a paycheck. Remember, not only does your organization rely on the people it hires, so do you.

James Sinegal, Co-Founder of Costco says:

If you hire good people, give them good jobs, and pay them good wages, generally something good is going to happen.”

Enhance the team’s skills. Even talented, experienced people can enhance their skills. As professionals, we must never stop learning. We must always strive for improvement. This will make us more effective, and heighten our self-esteem. It will also keep us from getting bored.

Will Smith, an accomplished television and movie actor, continues to hone his craft and refuses to simply walk through his roles. As he says:

I’ve always considered myself to be just average talent, [but] what I have is a ridiculous insane obsessiveness for practice and preparation.”

Recognize you can only control what you can control. As an example, you could have angst about whether the new tax code will have a negative impact on philanthropy. Or, you could examine the new code to see how you can leverage it for greater fundraising success. In other words, you can choose to worry about something over which you have no control, or you can decide to take steps to adapt to the new fundraising environment.

Self-help author Brian Tracy puts it this way:

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January 30, 2018

Russell James: Three for the Price of FREE!

One of the nation’s leading philanthropy researchers provides us with helpful insights about the new tax code and its impact on charitable giving. He also offers valuable information about planned giving.

Russell James, JD, PhD, CFP® articles, books, and videos will benefit any fundraising professional. Here are just three that will be a big benefit to you:

1. A Donor’s Guide to the 2018 Tax Law (video)

In just nine-and-a-half minutes, James explains how key provisions of the new tax code can benefit donors. With his insights, you’ll be in a better position to inspire more donations and larger gifts to your nonprofit organization. Simple illustrations and great examples will help you easily grasp the concepts.

Do you know?: Just one of the things you’ll learn from the video is that donors can contribute appreciated stock to avoid capital gains tax. Even non-itemizers can benefit from this. While this provision of the tax code remains unaltered, what has changed is that the new code makes this provision even more valuable for donors. James explains how in the free video:

2.Visual Planned Giving: An Introduction to the Law & Taxation of Charitable Gift Planning (e-book, updated January 2018)

I’m honored that James has allowed me to offer you a free copy of his 433-page e-book Visual Planned Giving: An Introduction to the Law & Taxation of Charitable Gift Planning. James designed the newly updated book for fundraisers and financial advisors seeking to expand their knowledge about charitable gift planning. This introductory book addresses all of the major topics in planned giving law and taxation in an accessible way.

Do you know?: Wealth is not held in cash. It’s held in assets. James has found that only one percent of financial assets are held in cash! So, if you want larger donations, you need to talk with supporters about making a planned gift from non-cash assets (e.g., stocks, personal property, real estate, retirement accounts, life insurance, etc.).

If you want to learn more about planned giving or help a colleague gain a fundamental understanding, you can download your free copy of Visual Planned Giving by clicking here.

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January 5, 2018

How Bad is the New Tax Code for Your Charity?

If you’ve been reading the mainstream press, or even some of the industry media, you might believe that the future is all doom and gloom for charitable giving thanks to the Tax Cut and Jobs Act. But, how bad will things really be for you and your nonprofit organization?

As a former newspaper editor, I know that the media lives by the axiom: If it bleeds, it leads. In other words, negativity attracts readers and viewers, which in turn attracts advertising dollars. So, it’s no surprise that the media have put the new tax code in the most negative light when it comes to charitable giving.

Fortunately, reality is something quite a bit different. Let me explain, using figures from 2016 (the most current numbers available).

Overall, charitable giving totaled $390.05 billion. US Gross Domestic Product totaled $18.6 trillion. Therefore, total philanthropy in 2016 equaled 2.1 percent of GDP.

As a result of the new tax code, charitable giving could decline by approximately $21 billion, according to Patrick Rooney, PhD, Executive Associate Dean for Academic Programs and Professor of Economics and Philanthropic Studies at Indiana University-Purdue University.

However, is that number accurate? Unfortunately, we have no way of truly knowing as Rooney himself states.

For example, the estimated philanthropic decline of $21 billion does not take into account the impact of a likely increase in Gross Domestic Product.

Because philanthropy closely correlates to GDP at the rate of approximately two percent, we can expect a rise in GDP to result in a rise in giving.

So, how much will GDP rise? Again, no one knows for certain. The estimates vary greatly from 0.08 to 0.35 percentage points. The Tax Foundation provided the latter estimate. Applying that percentage to the 2016 GDP, we would see GDP increase by $651 billion. If two percent of that increase goes to charitable giving, that would be approximately $13 billion. So, Rooney’s prediction of a $21 billion decline in philanthropy could be mitigated partially by GDP growth resulting in just an $8 billion drop in giving. However, even that number could be further offset by growth in foundation giving resulting from robust growth in the stock market.

Simply put, the new tax code could increase GDP and stock values leading to more charitable giving that could, at least partially, offset any potential decline in giving resulting from the new tax policy.

For the sake of discussion, however, let’s assume a $21 billion drop in giving, as Rooney outlined. That would take philanthropy as a percentage of GDP from 2.1 percent to 1.9 percent, using 2016 numbers. This is still within the 40+ year historical range.

The bottom line is that the new tax law could result in a decline in charitable giving. However, we don’t know for certain if that will be the case and, if it is, how much the dip will be. Even if there is a dip, giving will still remain at historically typical levels, around two percent of GDP. Furthermore, there is the possibility that the pundits are mistaken and that charitable giving will actually increase. Time will tell.

While the new tax code may change how and when people donate, history teaches us that changes in the tax code have only a short-term impact on the amount of giving though the methods and timing may vary. For example, the Reagan tax cuts resulted in greater year-end giving in 1986 before giving normalized thereafter. Furthermore, while a dip of billions of dollars is a big number, the reality is that it is not massive in the context of overall philanthropy.

Here are some of the relevant items you need to know from the 500+ page Tax Cut and Jobs Act signed into law on December 22, 2017 by President Donald Trump:

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