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  First, it has a new twist as it will not be published in a book.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.

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.

Recently we had a great e-mail debate among some of Ketchum’s senior consultants that was triggered by news stories noting that Vice President Biden’s 2007 charitable contributions totaled $995, and his giving in 2008 was $1,885.  This exchange led one consultant to quickly point out that Senator Biden was one of the least wealthy U. S. Senators.  Vice President and Mrs. Biden had an adjusted gross income of $269,256 in 2008.

I am not in a position to judge someone else’s perceived wealth or their philanthropic activity.  However, this debate did remind me of a conversation I had recently with a major female philanthropist who told me, “I just don’t feel as rich anymore” as she contemplated giving just a $5 million gift instead of something larger!  How much must one have to feel rich?  I do not know, but clearly it is a different answer for each of us. 

Around the country, Ketchum is seeing how the feeling of being rich or poor is driving organizations’ leaders and fundraising efforts.  Those feeling “poor” may be delaying projects and limiting fundraising efforts.  Others are more like the board chairman of an independent school who told me last week, “Moving forward with a capital campaign right now is a tough decision, but I just cannot stomach the notion of telling some parents that we are not going to do this for their kids because we are choosing to wait for ‘things to get better.’  Their kids need this now.” 

When Jon Duschinsky wrote Philanthropy in a Flat World: Inspiration Through Globalization (John Wiley & Sons Inc. 2009), he did not have the time to reflect upon the recession’s impact on global philanthropy.  His arguments for non-profit innovation and global thinking were tied to other factors.  But they ring even truer today, especially his admonishment that nonprofit leaders should

Take this opportunity to look long and hard at your core competency.  Work out what makes you great and what makes a real difference.  And then do it more and better and give the rest to someone else to do.

In other words, perhaps we will feel truly rich when we understand why our organizations are great and how they make a difference in people’s lives. 

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.