Is the Donor Always Right?

A few years back I had the pleasure of having Penelope Burk (of Donor-Centered Fundraising fame at http://www.cygresearch.com/) consult with the team I was on over a period of time.  If you haven't read her work I highly recommend it, and if you can afford her in person I recommend that even more highly, but her focus on doing right by the donor, and adhering to their wishes makes eminent sense.

Or does it?  Maybe not all the time, or at least not if the donor doesn't have the full picture...

I had a chat last week with someone who works at a large university, in a faculty that has a large number of affluent graduates.  Her lament was that funds were going to "naming this wing" or "supporting that special project", but the basic infrastructure of the department, the tools that the students use and the ability of administrators to efficiently do their work, was woefully underfunded.  Her phrase was, "we don't see a dime".

It's easier to fundraise when you can sell the naming rights or have a sexy special project, but fundraisers do their organizations a disservice if they also don't have a strong Case for support for all aspects of their organizations.  I know first-hand that unallocated funds are hard to raise, but if the only thing the prospective donor is aware of is the hot new project then my friend and her department ultimately suffer.

And if that's the case the donor really isn't right, even if it's not their fault.

The Elephant in the Room

Imagine you're running a business and you're told you can't invest in your production lines, pay your office heating and cooling bills, and even staff training and salary increases are subject to outside approval.  Now you know what it's like for many charities who find it virtually impossible to generate financial support for "core operations". 

Understandably most funders and donors want impact for their donations.  So they tend to want to fund programs, projects, new activities and "externally" focused costs.  But we all know you need to keep the lights on and pay "overhead" costs just to run those programs... I give full credit to organizations like the United Way of Toronto that does continue to fund "core operations" because without them many worthy organizations would be in real financial trouble.

And I don't think we'll resolve this issue until common standards are set, books are made fully transparent, and charities volunteer to show the "real" costs to donors and funders.  Once the philanthropic world has met this end of the bargain we need to talk about the elephant in the room: that there are legitimate costs to running a charity that need funding.  The alternative is to continue the current cycle of self-inflicted starvation (or funny games with how the numbers get reported) where every charity seeks to look like cheapest operator in town.