Every year around this time the Giving USA Foundation releases its annual report on philanthropy. Since the it is that time of year, surely I must blog about it.  As I sit here reflecting on the Report, however, I realize that the real discussion I want to facilitate is around the broader topic of the quality of metrics we use for fundraising and philanthropic results.  So there will be more on that in my next blog. 

In the meantime, here are a few interesting notes about the 2010 Giving USA Foundation Report.  First, it has a new twist as it will not be published in a book.  Rather, it is only available online, thanks to generous support from Pursuant and many others.  Also, key aspects of the report are available for free.  So if you haven’t seen it, go here.  Finally, as in every other year the Report has been published, individuals, not corporations or foundations provided the greatest percentage of philanthropic dollars.  Make sure you share this piece of information with anyone associated with fundraising for your organizations.  It might open their eyes to a huge untapped resource of philanthropic dollars: their neighbors, friends, colleagues, and other individuals they see every single day.  Finally it is interesting to note that overall giving was more than $300 billion for the third time in history.    

After the review the report, please come back and post your comments about it or your thoughts about fundraising metrics. 

Kristina Carlson, CFRE

President, Ketchum

At Ketchum, we receive a lot of questions from nonprofit organizations about fundraising, the economy, giving recovery after the recession and even more. We’ve put together a list of the top most frequently asked questions for 2009, and here are Ketchum’s answers.

For the third time this year I am writing about the passing of someone who had a significant impact on  the world of fundraising.  And for the second time this year, that person is someone I consider a mentor and friend.  Charley Trimble passed away today.  For more than 45 years, Charley served Ketchum’s clients and taught Ketchum consultants how to run successful capital campaigns.  The campaign he directed for Johns Hopkins in the early 70s was Ketchum’s first $100 million campaign.  He was the one who created Ketchum’s modern campaign “manual.”  He also developed KCP, Ketchum’s first commercial software program for the management of capital campaigns.  In the words of Elliott Oshry, “Charley was a mentor, a tyrant, an extraordinary strategist, a disciplinarian, and a good friend to fundraising consultants, volunteer leaders, and Ketchum clients for more than 45 years.”  I cannot even begin to fathom the number of indviduals who credit a portion of their fundraising knowledge to Charley but I know I am one of them.  Please consider posting your own memories of Charley here. 

American individuals, corporations and foundation were very generous in 2008, contributing more than $307 billion to nonprofit organizations.  As in the past, more than 80% of these dollars were given by individuals. While foundations showed a slowing increase over 2007 in giving, corporate giving, which comprises only 5% of all giving, fell for the second year in a row.  

While 2008 was only the second year that giving surpassed the $300 billion mark, the Giving USA report does show the recession’s impact on philanthropy.   For the first time since 1987 and only the second time since Giving USA began publishing annual reports in 1956, total giving decreased in current dollars. 

Our fundraising forefathers have navigated similar times in history when the economy was challenged and fund raising significantly affected.  In fact, Ketchum was founded in 1919 and has help steer organizations through times as tough as the Great Depression.  As sponsors of the Giving USA report, we know that the historical perspective provided by the Giving USA report helps to show that people continue to faithfully give during tough times.

It also shows that the economic impact on giving is not always equitable to all sectors of nonprofits and all nonprofit organizations.  While education and arts non profits saw wide swings in giving and human services saw the largest decline ever reported, some groups like society benefit based non profits and faith based groups actually saw increases in giving. 

According to Guidestar and AFP many non-profits are still seeing their total dollar giving go up in this economy.  The 2008 edition of the GuideStar Nonprofit Survey: Charitable Organizations and the Economy report found volatility in the giving to charitable organizations. When asked if there was a change in contributions from 2007:

• 35 percent reported an increase in charitable revenue;

• 25 percent reported that contributions had remained about the same; and

• 35 percent of respondents reported a decrease

• 2 percent didn’t know.

The Guidestar study reaches any charity that wants to complete it (a convenience sample). At least 2,730 separate organizations participated in the 2008 poll. The percentage reporting a decrease is approximately the same as the percentage that reported a drop in giving in 2002.

The Association of Fundraising Professionals surveyed its membership. With several hundred respondents, this study found:

• 46 percent of organizations raised more funds in 2008 than in 2007;

• 14 percent raised about the same amount of money in both years; and

• 40 percent raised less in 2008.

Certainly,  Giving USA data is important to understanding general philanthropic trends as well as understanding philanthropic trend within various economic climates.  However, this data alone is not enough to explain the fundraising ups and downs of a single organization.  As the Guidestar and AFP data above, and individual cases noted in the media show, some nonprofits saw success last year and are still succeeding in this climate.  And data from the Fundraising Effective Survey , which shows that most nonprofits have been losing 5 donors for every 6 they gain, suggests that other non-economic factors have been inhibiting fundraising success for at least a couple of years leading up to the historical decrease in 2008. 

At Ketchum, we know that the decline shown by the Giving USA numbers is significant.  However, $307 billion is a lot of money.  People are still giving.  Keep asking and showing the impact of philanthropy on your mission.

Today The Giving Institute, formerly the American Association of Fundraising Counsel (AAFRC), is hosting its Spring Meeting in New Orleans.  Last night the program was phenomenal.  Four representatives from New Orleans organizations talked about how they survived and are now thriving as a result of Katrina.  Dr. Norman Francis from Xavier University, who amazingly has been president of that school for 42 years, discussed the importance of passion, commitment and faith in getting the school re-opened within 4 months.  Julia Bland, Executive Director of the Louisiana Children’s Museum, shared how Katrina cut their staff by 65%, left them with no audience for months (there were no children in New Orleans for months after Katrina), but in the end gave them the opportunity to think in a broader way about how they serve the community.  Now, they have a greater commitment to early childhood education and are bringing more programs into neighborhoods.  Andy Wisdom, Trustee, RosaMary Foundation spoke about his foundation’s renewed commitment to education post-Katrina.  Prior to the disaster, New Orleans schools were in such disarray that a major philanthropic gift would make little difference.  Today, the school system is being rebuilt with such innovation that philanthropy can make a difference.  Finally, John Bullard, Director of the New Orleans Museum of Art described how members of his staff moved their families into the museum to protect the art.  They also had to learn how to carry guns! 

In each story, there was the message that with commitment, innovation and faith, the disaster has made their organizations stronger and more meaningful for the community.  A great message to hear in these “tough” economic times.  

“We can’t be out asking for major gifts right now so we are spending our time on cultivation and stewardship.”  Sounds like a smart, professional approach and I have heard this statement or a variation thereof more than a few times in the last couple of months.  I have read more than a couple of articles, written by experts, touting this approach too.  Initially, I even thought that this blog should about the economy and trends such as this. 

But then I saw the headline, “Taliban threatens to kill aid workers as spies.”   The article goes on to say that “Afghan girls have been burned and scared randomly with acid as punishment for going to school. More than 600 schools did not open this year because of security issues, according to the Afghanistan Education Ministry.” 

Could you imagine working for Greg Mortenson of the Central Asia Institute, (subject of bestselling book, Three Cups of Tea), reading this article, and saying, “we cannot be out asking for major gifts right now?” 

This got me thinking about my friend who discussed with me how Slumdog Millionaire is not popular in India.  In fact, her husband just returned from a mission trip there and says that in some areas of the country, the film is banned.  Why?  According to him, the locals resent having the outside world see their ugliness.  He had been in India bringing aid money that had been raised in their church. 

Asked if the church has slowed its fundraising for aid because of the economy, she replied, “No, the need there is too great.” 

And then I thought about some of the people a little closer to home; a friend whose passion for increasing the literacy rate of our children supersedes any of his concerns about the economy;  my own father who is battling dementia with all the latest treatments (created as a result of research partially funded by philanthropy); and the college student in one of the poorest counties in the U.S. who is working two jobs in an attempt to stay in school because her scholarships have been cut.

In most respects, the trend of growing professionalism of fundraising has been good.  However, I cannot help but wonder if sometimes we allow our “professionalism” to interfere with the passion for what needs to be done.  So much so that some of the poorest people in the world are “ashamed” of their circumstances while we determine that now is not the time to be asking the richest people in the world to affect change.      

I am not advocating ignoring the circumstance of some of our donors.  However, instead of buying into the strategy du jour, how can we not be asking for major gifts now?