A funny thing happened on the road to economic recovery. We got more market capitalist about our charity dollars.
While the corporate world was tsk-tsked by commentators (and soft protests such as the Occupy movement) for colossal severance packages and bailouts, nonprofits have turned toward "corporate greed" and market share.
Skip Rutherford, dean of the Clinton School of Public Service and trustworthy prognosticator, put it this way. "While the economic recovery may have not yet reached Main Street, it has reached Wall Street. The continuing financial success of those in the 1-percent-and-higher income levels, along with strong stock prices, are good early signs for major 2015 nonprofit contributions. Over the past few years, I've seen a growth in more accountable and less emotional giving."
This, and more interactive fundraising, are my predictions for the nonprofit world in 2015. And not just mine. I recently asked a bunch of folks whose paths I cross on my beat (as it were) what they expect more of in 2015 -- whether they planned to give more, and whether their charities/nonprofits will grow, shrink or maintain. These folks are company spokesmen, nonprofit development directors, philanthropic board members and benefactors. I told them I was willing not to identify them by name, if that freed them up to tell the truth.
One is Eric Wilson, a one-time protege of Rutherford's, now chief executive officer of the entrepreneurial curriculum start-up Noble Impact.
Quit penalizing nonprofits with steep overhead and development budgets, he said. Watch Dan Pallotta's TED Talk from 2013. The author of Uncharitable (and a huge fundraiser) says we treat charities that behave like corporations -- big personnel, capital projects and advertising budgets -- as if they're pirates. We should stop.
"This is what happens when we confuse morality with frugality. We've all been taught that the bake sale with 5 percent overhead is morally superior to the professional fundraiser enterprises with 40 percent overhead, but we're missing the most important piece of information, which is, what is the actual size of these pies?" he says in his TED Talk. "Who cares if the bake sale only has 5 percent overhead if it's tiny? What if the bake sale only netted $71 for charity because it made no investment in its scale, and the professional fundraising enterprise netted $71 million because it did? Now, which pie do we prefer, and which pie do we think people who are hungry would prefer?"
Because each year nonprofits are asked "How much did you make?" followed by "How much did you give away?" charities are hopelessly un-innovative. Companies occasionally suffer periods of low revenue and strategic build-out so they can make quantum leaps. Just ask Windstream.
Of course, some go bankrupt.
Similarly, most everyone who responded was soured a bit on The Big Gala Fundraiser. Some of the best known galas are going into their fourth or fifth decade. So let's give them up --
Whoa! No one's saying that (least of all the social pages editor).
The truth is, there's no obvious successor to the ballroom fundraiser. For hours, days, weeks Salvation Army bell ringers stand outside stores asking people with wallets handy to give, and the sum of all that face-to-face solicitation isn't half what the Winthrop Rockefeller Cancer Institute netted in one night of jubilee in September.
The ballroom fundraiser isn't going anywhere, so buy your tickets now, or tomorrow. Whenever, really.
Giving
An employee of a frequent fundraising event sponsor told me on background that her company is increasingly seeking a more service, less monetary approach to giving. It's moving "away from nationally run organizations" in favor of more local ones, and "instead of saying no to nonprofits we think are doing good work, we offer volunteers and volunteer hours, maybe to set up an event, help with the cleanup or even the manpower to cook and help reduce hard costs that way."
Everyone with whom I corresponded said, not surprisingly, they'd be just as generous this year or more.
Renie Rule, nonprofit creator and professional fundraiser with the University of Arkansas for Medical Sciences, pledged to increase her giving to her workplace (College of Medicine), her nonprofit (Paws in Prison) and her nearest ballroom fundraiser Tabriz (for the Arkansas Arts Center) by 10 percent.
Daniel Robinson, local philanthropist and chairman of the Women and Children First shelter board, said his family plans to give the same as every year, and "we have given more every year. This isn't something we budget/plan for, but at tax time the proof is in the pudding."
Of course, not all charities will grow or maintain.
Out of 'business'
The end of last year brought news that World Services for the Blind is insolvent. Its newly hired chief executive, Stacey Hunter Schwartz (whose husband is the local law school dean) resigned last month after being on the job about four weeks. The organization's former chief, Tony Woodell, was there five months.
And I recently got word from a former Literacy Action of Central Arkansas board chairman that the charity could fold because of the loss of state and federal grants, but executive director Sara Drew said there's little chance of that -- the charity is used to running very lean. (Literacy Action also changed chiefs late last year.)
If, as Pallotta would have us believe, we must begin to champion the growth cycle of nonprofits as we do publicly traded companies, does it mean we should not mourn the passing of some? Will we conclude that the current "market" for aiding the blind and the illiterate simply can't support the scant services rendered in 2014?
Meanwhile, Susan Elder, executor of The Jim Elder Good Sport Fund, won't hold a Home Plate Auction this year -- "my attempt to bow somewhat gracefully out of the crowded and time-intensive world of raising money."
This is one of my favorite charity stories of the year.
Since its inception in 1998, Susan Elder says the fund has given out close to a million dollars to Arkansas college students. It always aimed to do as much good in the name of her father as it could, not grow into a thing -- a workplace with a payroll and a health plan.
With its existing endowment it will continue to select and give out college scholarships as well as support the ongoing renovation of Lamar Porter Field. She expects the money to run out in 10 to 15 years.
Happy 2015! (Thank you for shooting straight)
Charity is 2 percent of the nation's gross domestic product, or roughly $300 billion, Pallotta says in his talk, and 80 percent of that goes to religion, higher education and hospitals.
"Most rich folks give their money to religion and politics. So you're always competing with all of that," Ray Wittenberg of the literary magazine Oxford American told me.
So true, Ray, and thank you for your candor.
Thank you to Stephanie Harris, founder of the nascent Women Lead Arkansas, who shot straight with me when she said, "I do think that nonprofits need to get creative with their marketing and communication. I often feel overwhelmed with ads, requests for support, and information generally. It is hard for nonprofits to stand out when there is so much competition ... [and] it will get more challenging."
And to June Freeman, who directs the Architecture and Design Network, and said some long-standing nonprofits like the Winthrop Rockefeller Cancer Institute, the Arkansas Symphony Orchestra and the Arkansas Arts Center "cultivate an aura of exclusivity," to the detriment of others. And then added, "of course, that is what your section is supposed to dote on, for the most part."
Le mot juste, June!
Thank you all for your candor. Consider it charity to this reporter.
Email:
bampezzan@arkansasonline.com
High Profile on 01/04/2015