Sponsorship is a tricky thing

In an article on 14 April in The Australian Financial Review it is noted that the ‘commercial path’ was rejected in favour of naming the Melbourne Theatre Company’s new theatre after the company’s founder.  

Naming rights have become increasingly popular as a way of recognising benefaction – but there can be hidden risks which may relate to organisational reputation and potential conflicts of interest. As some North American institutions have found, physically gouging out a benefactor’s name from the material fabric of a building is messy and unsightly.  

Is there a need for less ostentation and a greater reflection of true benefaction without personal or corporate gratification?

The Concept of in Memorium Gifts is Growing

The concept of in memorium gifts is growing. These are the gifts to charities and other tributes which families are increasingly encouraging in lieu of flowers. There is little data on in memorium gifts but the trend seems to be growing. And while the cost of flowers seems to be increasing, the level of in memorium gifts is not rising at the same rate.  Charities usually liaise with next of kin to advise the list of donors but rarely is the amount donated recorded publicly. Why not? Would this enhance in memorium giving? Or is there a ‘politeness’ reason for not going public with the amount each individual donates.  Some charities believe that if the amount of the donation were listed, the total value of in memorium gifts would rise.

Fundraising is all about relationship management isn’t it?

Fundraising is all about relationship management isn’t it? Yet a recent report in the Financial Review quoting Sweeney Research’s sports report on Australian companies’ donations to the sporting world showed a very low recognition recall for sponsorship and sports events.

Could the same be true for corporate sponsorship of charitable and nonprofit causes? Perhaps arts events have pitched the corporate relationship better than others in the nonprofit sector?

Apparently a recognition rate of around 20 – 25% is considered acceptable in terms of awareness. And companies are often using sponsorship to spin off other relationships, rather than depending on broad public recognition.

As the field becomes increasingly complex with corporate social responsibility, social ventures and philanthropic and other gifting, relationship management may take on new dimensions.

Ethical considerations of charities providing assistance in drafting wills

Fundraising Institute Australia (FIA) recently issued a draft Standard of Bequest Fundraising Practice for public consultation. Since then we have received many written submissions on the Standard. After careful consideration, FIA will amend the draft Standard which, once adopted by FIA’s Board, will become the standard of best practice to be adhered to by FIA members.

The principal issue being debated relates to ethical considerations to ensure that there is no perception – real or otherwise – of undue influence on the part of the charity if it provides assistance of any kind in the drafting of a will.

The Charity Commission for England and Wales makes the point that “For a charity, its reputation is vital – and if it meets the cost of the preparation of a will which is challenged, its reputation for fair dealing could be compromised.” A freely made bequest is more likely to be successfully defended by the charity from attack by other parties under the legal doctrine of undue influence.

For further information, the Charity Commission’s guidance paper Paying for Wills with Charity Funds is available online - http://www.charity-commission.gov.uk/supportingcharities/paywill.asp

The FIA guidelines Bequest Fundraising – Ethical considerations for promotional events recommends charities considering bequest fundraising to ensure that legal advice to testators and the conduct of promotional events concerning wills are fair and free of undue influence.  

What do you think?

Should charities run free wills days?

Should charities pay for wills with charitable funds?

Are there too many charities?

During a meeting with the CEO of one of Australia’s largest corporate foundations recently, I raised the question of whether there are too many charities.

She felt the question is especially relevant in Australia today and needs to be addressed. This issue is also discussed frequently by philanthropists. 

No-one stops coffee shops opening, whether there are others in the same vicinity. The best will succeed, the rest will fold. Should charities have similar freedoms? Does the private vs public funding make a difference?  

This is not an article about amalgamation and creating bigger charities. Rather it is on the proliferation of new charities, some paralleling almost exactly existing charities.

Recent research by QUT Centre on Philanthropy and Nonprofit Studies highlighted that there are 21,957 charities with Deductible Gift Recipient (DGR) status and 48,000 income tax exempt charities (ITECs) in Australia, of which more than 18,000 were founded between 1990 - 2005. Half the DGRs have less than $55,304 in receipts.  

In the US, Internal Revenue data shows there are over 1 million charities, including over 700 breast cancer charities. 40% of US charities were established in the decade between 1995- 2005 and most have revenues of less than $US25,000.  In the UK 60% of registered charities have an income of £10,000 or less and 8% of charities receive 90% of annual income.  

Per head of population, Australia has fewer charities than either the UK or the US, around one charity for every 437.5 people! Nevertheless, there is a similar trend and it’s almost inevitable that some of the international issues will surface here before too long.  

In the US in 2003, for example, the number of new charities increased by 5.6% while 4.5% closed. What does this do for public confidence in charity stability and accountability?

Most growth was among organisations with a religious focus, followed by educational institutions, social services groups and arts and cultural organisations.  The rapid growth in charities has meant the rise of issues such as overlapping services, challenges in differentiation and getting new causes heard above the charitable cacophony.  

One to think about?

Why isn’t there a focus on qualifications for working in charitable organisations? and for fundraising?

What drives fundraisers? Making a difference? Yes! Feeling useful in society? Yes! Being a good citizen? Perhaps! There are many reasons why people become involved with charities and fundraising. The most common answer I’ve found is that people want to make a difference.

There are other pluses for working in the nonprofit sector. Work usually has great variety, often you shoulder responsibility earlier in your career than you would in the corporate sector. You have a chance to mix with the most interesting people, including corporate people.

So if such work is important, why isn’t there a focus - somewhere - on qualifications for working in charitable organisations? and for fundraising?

I think it’s coming - a bit like marketing qualifications came upon the scene some while back. Now of course if you are in marketing you expect to have a degree, if not a masters or doctorate. Fundraising isn’t marketing, it’s fundraising so it needs courses dedicated to providing the varied skills necessary for the role.

Are there universities out there prepared to look at undergraduate courses that will provide for some of the 600,000 people working in the sector?