Gail Meltzer and I are In Tucson this week, taking part in the Community Driven Institute. The brainchild of Hildy Gottlieb and Dimitri Petropolis, the Institute evolved out of Hildy’s book, The Pollyanna Principles, and focuses on governing for what matters, instilling a “culture of can” and engaging the community in creating amazing futures where organizations actually achieve their visions.
The class is small – there are only five participants – so we are able to explore issues in depth. It is also incredibly intense. We are meeting from 8:30am to 5:15pm everyday for a full week. We walk out of the Institute each evening with our brains overflowing with new ideas for helping our clients dramatically move their organizations forward. While you will be hearing more from us about the concepts we are exploring as time goes by, Gail and I want to share some of our excitement with you now. Therefore, we’ll be blogging the rest of the week.
The focus today was on vision and values. If you have ever worked with me, you know that I am a firm believer in the power of vision and values and that they should guide every decision you make. However, in the future, be assured that these two elements will take an even more hallowed position in the work that we do. There is a saying that when you reach for the stars you may not quite get one but you won't come up with a handful of mud either. By embracing vision and values you can change the community in ways you never thought possible. In today’s environment, where violence, pollution, hunger, poverty, drugs, illness and other issues cloud our future, it is incumbent upon us to fulfill our promises to the community. And, it is doable merely by keeping our eyes on what is important and working backwards from there!
Tuesday, October 27, 2009
Wednesday, October 7, 2009
DO’S AND DON’TS OF CHOOSING A GRANT WRITER
Q: We are looking for a grant writer. A few people on the board suggested different individuals they knew from other organizations, but they seem expensive and only one said she’d be willing to work on a contingency basis. While most of us wanted to go with her, someone on the board said we can’t. The rest of us don’t really understand why not. And, if that’s true, we definitely don’t have the money to make a mistake. How do we know who to choose? We agreed to write you and go along with what you said.
A: While I can’t promise to help you make the “right” choice, I can help ensure that you make a better choice.
Let’s start with the easy part of your question – the contingency fee. Whoever on your board said you should steer clear of this person was offering good advice. On the surface, such a “guarantee” of success seems like the most prudent approach to take. The grant writer appears confident enough of her ability to obtain the grant on your behalf that she is willing to risk her time and energy on the chance of a return. That seems to imply that this person is more competent than the others. On top of that, you don’t have to put any money out until you have money in your pocket. However, there are several reasons why the seemingly smart move is the wrong move in this case. Let me share just two here.
First, every professional organization to which a fund raiser in general and a grant writer in specific might belong forbids contingency fees in their codes of ethics. While we could debate the validity of the reasons for this, that is not at the heart of your question. I think it is enough to say that if this person is going against what is deemed standard ethical behavior in the field, either she is not as familiar with the field as she thinks, she’s new and feels that this is a good way to break in, or she is knowingly ignoring the standard and then you have to question what other ethical standards she might ignore while representing your organization.
Second, most grant guidelines clearly state that any costs associated with writing the grant proposal cannot come out of the grant. This means that she is going to have to hide her payment in the proposal. It also means that you will have to play with the books in order to maintain the charade when, if you get the grant, you report back to the funder – as required – on the use of the funds. I trust you don’t want to take that road. If you do and your antics are discovered, you may not only have to pay back the money, but you stand a chance of never getting another grant.
So, if you’re going to bite the bullet and pay for your grant writing services upfront, how do you make the best choice? You took a good first step by asking board members who they have successfully worked with in the past. A strong track record is an excellent indicator. Ask for the percentage of grants each person has gotten funded. You might also want to find out the average size of each grant. Someone might have a great success rate, but only have experience, for instance, with grants under $35,000 when you are looking to go after a several million dollar grant.
I would ask each of these individuals about the mission areas in which they specialize. Most grant writers tend to focus on one or two. Someone who already works in your mission area will know who the funders are, what they are looking for and how they like their proposals written. In addition, they will know where to find many of the relevant demographics and other statistics to be included.
I would see what each requires of your organization. Grant writing is a partnership. The grant writer cannot do the job on his/her own. An experienced grant writer will be able to tell you exactly what the organization’s role in the process will be and what materials the organization will have to produce.
Assess the chemistry. Again, this is a partnership. You will be working closely together and often on short deadlines that can test the best relationships. You need to feel comfortable with this person.
Ask to see writing samples. While the person should not be giving you another organization’s grant proposal without having previously obtained permission, or at least redacting all identifying information, you can look at almost any writing sample to determine if the person writes coherently and is attentive to spelling, grammar and basic layout.
Finally, there is now national certification for professional grant writers. The lack of such certification does not mean that someone is a bad grant writer. This certification has only been available for a relatively short while, so few have had the opportunity to work through the process. And, some grant writers who have been working successfully for a long time and have a loyal clientele may never feel the need to go through the process. Besides, the possession of certification does not guarantee someone is a star. However, the rigorous process does rightly grant you some assurance that the person has had several years of experience in the field and has demonstrated a high level of knowledge about it. You can find the names of those who have obtained certification by going to http://grantcredential.org/gpc-certification/credentialed-grant-professionals.aspx.
Just remember, you can find the best grant writer in the world but you should still not expect grants to be the primary source of your funding. You need a diversified funding stream – especially today when grants funding is down significantly.
A: While I can’t promise to help you make the “right” choice, I can help ensure that you make a better choice.
Let’s start with the easy part of your question – the contingency fee. Whoever on your board said you should steer clear of this person was offering good advice. On the surface, such a “guarantee” of success seems like the most prudent approach to take. The grant writer appears confident enough of her ability to obtain the grant on your behalf that she is willing to risk her time and energy on the chance of a return. That seems to imply that this person is more competent than the others. On top of that, you don’t have to put any money out until you have money in your pocket. However, there are several reasons why the seemingly smart move is the wrong move in this case. Let me share just two here.
First, every professional organization to which a fund raiser in general and a grant writer in specific might belong forbids contingency fees in their codes of ethics. While we could debate the validity of the reasons for this, that is not at the heart of your question. I think it is enough to say that if this person is going against what is deemed standard ethical behavior in the field, either she is not as familiar with the field as she thinks, she’s new and feels that this is a good way to break in, or she is knowingly ignoring the standard and then you have to question what other ethical standards she might ignore while representing your organization.
Second, most grant guidelines clearly state that any costs associated with writing the grant proposal cannot come out of the grant. This means that she is going to have to hide her payment in the proposal. It also means that you will have to play with the books in order to maintain the charade when, if you get the grant, you report back to the funder – as required – on the use of the funds. I trust you don’t want to take that road. If you do and your antics are discovered, you may not only have to pay back the money, but you stand a chance of never getting another grant.
So, if you’re going to bite the bullet and pay for your grant writing services upfront, how do you make the best choice? You took a good first step by asking board members who they have successfully worked with in the past. A strong track record is an excellent indicator. Ask for the percentage of grants each person has gotten funded. You might also want to find out the average size of each grant. Someone might have a great success rate, but only have experience, for instance, with grants under $35,000 when you are looking to go after a several million dollar grant.
I would ask each of these individuals about the mission areas in which they specialize. Most grant writers tend to focus on one or two. Someone who already works in your mission area will know who the funders are, what they are looking for and how they like their proposals written. In addition, they will know where to find many of the relevant demographics and other statistics to be included.
I would see what each requires of your organization. Grant writing is a partnership. The grant writer cannot do the job on his/her own. An experienced grant writer will be able to tell you exactly what the organization’s role in the process will be and what materials the organization will have to produce.
Assess the chemistry. Again, this is a partnership. You will be working closely together and often on short deadlines that can test the best relationships. You need to feel comfortable with this person.
Ask to see writing samples. While the person should not be giving you another organization’s grant proposal without having previously obtained permission, or at least redacting all identifying information, you can look at almost any writing sample to determine if the person writes coherently and is attentive to spelling, grammar and basic layout.
Finally, there is now national certification for professional grant writers. The lack of such certification does not mean that someone is a bad grant writer. This certification has only been available for a relatively short while, so few have had the opportunity to work through the process. And, some grant writers who have been working successfully for a long time and have a loyal clientele may never feel the need to go through the process. Besides, the possession of certification does not guarantee someone is a star. However, the rigorous process does rightly grant you some assurance that the person has had several years of experience in the field and has demonstrated a high level of knowledge about it. You can find the names of those who have obtained certification by going to http://grantcredential.org/gpc-certification/credentialed-grant-professionals.aspx.
Just remember, you can find the best grant writer in the world but you should still not expect grants to be the primary source of your funding. You need a diversified funding stream – especially today when grants funding is down significantly.
Saturday, September 12, 2009
Your Annual Report Should Rock!
If you are not yet creating an annual report that shares with donors and other supporters what you have achieved in the past year through their generosity and commitment to your important work....WHY NOT? If you are already producing an annual report but are not using it to help raise awareness and funds, WHY NOT? Your annual report gives you a unique opportunity to do so much more than disclose your financials for the year. It can also be a compelling marketing piece to be used all year long. Here are 10 things to think about to take your annual report to the next level.
1. Select a theme for the report, something that runs through your organization's past 12 months. Have you had unprecedented growth in challenging times? Have your exhibits drawn huge crowds? Have you begun to attract a whole new demographic/age group/type of student? You may even want to have the whole report written from the point of view of one of your clients, students, visitors.
2. Tell stories that illustrate how you have changed someone's life or made a dramatic difference in your community. Focus on people. Even if your organization is an animal or environmental protection group, talk about how people are affected by what you do.
3. Use dramatic photos. Make them big, perhaps even an entire page. Avoid small, group photos that are ordinary and boring. If you have some in your file that are appropriate, all the better, but if you have to take new ones, don't pinch pennies in this regard. Have them professionally done. You may also want to think about what "cut lines" you want to have BEFORE you decide what photos to use. Then you can take the photo you need.
4. Write for the reader. Use a conversational tone. Picture your typical reader as you are writing. Avoid jargon, long sentences and paragraphs, boring statistics. This isn't about YOU, this is about your donors and supporters. Think about what they want to hear, not just about what you want to say.
5. Use simplified financials, a pie chart, a brief financial statement. While this is vital to the report, it is only a part of your story and should not dominate the piece.
6. List your donors and meticulously check for accuracy and typos. Celebrate them and acknolwedge their critical role in what you were able to accomplish in the last year.
7. Have the report professionally designed and printed. Don't prepare it in-house and run it off on your copy machine. Because you are going to use it all year long (see number 8), spend the money to make it look crisp, clean and graphically beautiful.
8. Print enough copies to be able to do the following:
1. Select a theme for the report, something that runs through your organization's past 12 months. Have you had unprecedented growth in challenging times? Have your exhibits drawn huge crowds? Have you begun to attract a whole new demographic/age group/type of student? You may even want to have the whole report written from the point of view of one of your clients, students, visitors.
2. Tell stories that illustrate how you have changed someone's life or made a dramatic difference in your community. Focus on people. Even if your organization is an animal or environmental protection group, talk about how people are affected by what you do.
3. Use dramatic photos. Make them big, perhaps even an entire page. Avoid small, group photos that are ordinary and boring. If you have some in your file that are appropriate, all the better, but if you have to take new ones, don't pinch pennies in this regard. Have them professionally done. You may also want to think about what "cut lines" you want to have BEFORE you decide what photos to use. Then you can take the photo you need.
4. Write for the reader. Use a conversational tone. Picture your typical reader as you are writing. Avoid jargon, long sentences and paragraphs, boring statistics. This isn't about YOU, this is about your donors and supporters. Think about what they want to hear, not just about what you want to say.
5. Use simplified financials, a pie chart, a brief financial statement. While this is vital to the report, it is only a part of your story and should not dominate the piece.
6. List your donors and meticulously check for accuracy and typos. Celebrate them and acknolwedge their critical role in what you were able to accomplish in the last year.
7. Have the report professionally designed and printed. Don't prepare it in-house and run it off on your copy machine. Because you are going to use it all year long (see number 8), spend the money to make it look crisp, clean and graphically beautiful.
8. Print enough copies to be able to do the following:
- mail to all your donors, supporters, key stakeholders
- provide copies to your vendors and board members to put in their waiting rooms as appropriate
- include in your media kit
- send to new donors
- send/give to prospects and those who visit your facilities
- provide at your events
- send to your collaborative partners
9. Have it translated into another language if that is appropriate for your organization. You may not need to print hard copies in a second or even a third language; it may be sufficient to have them available for download from your website. And of course you will have the English version available on the website also.
10. Begin now and continue all year long to make notes about what to consider including in next year's annual report to make it even better.
Tuesday, September 1, 2009
Make the Founder a Permanent Board Member at Your Peril
Q: Our current executive director is the founder of our organization. While she has accomplished much over the years, the board feels it is time to find someone with a different skill set to move the organization to the next level. We expect this will be a difficult transition. The board chair suggested we make the founder a permanent board member in recognition of her vision and commitment. While I think the chair envisioned this as an honorary or advisory position, some of us know the founder well and suspect that she will expect that not only she but her family members serve as voting members on the board for generations to come. Our guts tell us this wouldn’t be wise. What are our options and how do you suggest approaching this?
A: Listen to your gut! While I appreciate what you perceive to be the founder’s desire to remain intimately connected, the organization belongs to the community, not to her. And, your responsibility as board members is to the community, not to her. Allowing her and her family to serve as permanent voting members of the board would not be wise on several levels.
As long as the founder remains on the board, the rest of the board will tend to defer to her. This will make the position of the new executive director untenable, and the entire reason you went with this change in the first place will become moot because she will remain the de facto executive director.
A clean cut would be better. To make such a cut easier, before the founder is asked to step down I would make sure that the board takes the time to review with her the mission, vision and organizational values. If she feels confident that everyone understands her vision and is committed to taking it, and the values on which the organization was founded, forward, she may be more amenable to letting her “baby” operate independent of her, knowing it won’t stray too far from “home.”
There may be arguments for allowing her family members to serve on the board, but having multiple members serve at one time is wrought with potential problems. It’s not that there aren’t some definite pros, as I enumerated in a 2000 column entitled, “Should Husbands and Wives Serve Together,” but the cons are powerful. Among them: her presence will always loom large, dictating the direction of the organization. In addition, you will be limiting your reach into the community. Families tend to share many of the same contacts. Today, when board size is shrinking, it becomes particularly important to insist on greater diversity to increase the probability of widening your organization’s circles of influence as much as possible. Of course, then there are the flip sides of the same coin where group dynamics can become dysfunctional if the family either votes as a block or is constantly fighting. In the first instance the family forgoes the critical thinking so essential to the best decision-making. In the second, others may disengage to avoid being thrust in the middle of a public argument. Of course, the founder’s desire to have family members serve in perpetuity amplifies the potential problems. What happens down the road when a grandchild or great-grandchild lacks an affinity for the organization, yet is expected to serve?
One way you might handle this challenge is to be totally honest. Play on the woman’s love for the organization and her desire to see it flourish over the long term. Suggest that you would like to add “emeritus” to her title and invite her to serve as the face of the organization as well as an honorary board member throughout her lifetime. You may further recognize her by assuring her that her name and emeritus title will remain on the organization’s collaterals in perpetuity by codifying such instructions in organizational policy documents. However, I’d think long and hard about having her come to board meetings even without a vote. If she has a voice, she may still hold sway – at least until all board members who served with her when she was executive director are gone. Understand that she may not find these terms acceptable and you will have to make some very difficult decisions.
Of course, I’d start with going back to your bylaws and articles of incorporation. There are founders that insist on some sort of perpetuity clause when drafting these documents (something with which I am very uncomfortable). If she did, unless you change the bylaws and/or articles and re-file them with the Internal Revenue Service, you are pretty much stuck by the language contained in those documents.
A: Listen to your gut! While I appreciate what you perceive to be the founder’s desire to remain intimately connected, the organization belongs to the community, not to her. And, your responsibility as board members is to the community, not to her. Allowing her and her family to serve as permanent voting members of the board would not be wise on several levels.
As long as the founder remains on the board, the rest of the board will tend to defer to her. This will make the position of the new executive director untenable, and the entire reason you went with this change in the first place will become moot because she will remain the de facto executive director.
A clean cut would be better. To make such a cut easier, before the founder is asked to step down I would make sure that the board takes the time to review with her the mission, vision and organizational values. If she feels confident that everyone understands her vision and is committed to taking it, and the values on which the organization was founded, forward, she may be more amenable to letting her “baby” operate independent of her, knowing it won’t stray too far from “home.”
There may be arguments for allowing her family members to serve on the board, but having multiple members serve at one time is wrought with potential problems. It’s not that there aren’t some definite pros, as I enumerated in a 2000 column entitled, “Should Husbands and Wives Serve Together,” but the cons are powerful. Among them: her presence will always loom large, dictating the direction of the organization. In addition, you will be limiting your reach into the community. Families tend to share many of the same contacts. Today, when board size is shrinking, it becomes particularly important to insist on greater diversity to increase the probability of widening your organization’s circles of influence as much as possible. Of course, then there are the flip sides of the same coin where group dynamics can become dysfunctional if the family either votes as a block or is constantly fighting. In the first instance the family forgoes the critical thinking so essential to the best decision-making. In the second, others may disengage to avoid being thrust in the middle of a public argument. Of course, the founder’s desire to have family members serve in perpetuity amplifies the potential problems. What happens down the road when a grandchild or great-grandchild lacks an affinity for the organization, yet is expected to serve?
One way you might handle this challenge is to be totally honest. Play on the woman’s love for the organization and her desire to see it flourish over the long term. Suggest that you would like to add “emeritus” to her title and invite her to serve as the face of the organization as well as an honorary board member throughout her lifetime. You may further recognize her by assuring her that her name and emeritus title will remain on the organization’s collaterals in perpetuity by codifying such instructions in organizational policy documents. However, I’d think long and hard about having her come to board meetings even without a vote. If she has a voice, she may still hold sway – at least until all board members who served with her when she was executive director are gone. Understand that she may not find these terms acceptable and you will have to make some very difficult decisions.
Of course, I’d start with going back to your bylaws and articles of incorporation. There are founders that insist on some sort of perpetuity clause when drafting these documents (something with which I am very uncomfortable). If she did, unless you change the bylaws and/or articles and re-file them with the Internal Revenue Service, you are pretty much stuck by the language contained in those documents.
Thursday, August 27, 2009
10 Fundamental Pillars for Organizational Success
Very kindly, I have been invited to contribute to this site by the management of CoreStrategies for Nonprofits where I have agreed to be a part-time Senior Consultant. After 46 years of successful professional experience, 29 in the For-Profit (FP) world and 17 years in the Not-for-Profit (NFP) world, I retired in June 2009. In the last 26 years, I was at the Senior Level or the President & CEO of seven organizations; In those 26 years, we successfully turned around 20 (fifteen FP and five NFP) organizations, from “ready to close” to complete financial and programmatic stability.
There are many fundamental pillars on which the management, quality, and growth of an organization, regardless of the size and sector [NFP vs. FP] in which it operates that are essential for the organization’s success. In these challenging times, I urge that you consider changing or dismantling these key aspects of your organization only after careful consideration and forethought.
For-Profit and Not-for-Profit -- For me there never was a distinction between the NFP and FP worlds. In one, I operated a “Business for Shareholders”; in the other, I operated a “Business with a Heart” but I operated under the fundamental principle that I was running a business.
Fundamental Pillars - The keys that permitted us to succeed in each organization, regardless of the industry or country are simple. Each key has been carefully developed and tested over time.
1. Three to Five-Year Business Plan: Vision and Implementation – Ensure that a three to five-year plan is always in place, casting the vision and intentions out in front of us to guide our day-to-day work.
2. Philosophy and Methodology – Ensure the creation of a common organizational culture marked by:
• Commitment to the children and families that you serve and the staff that
serves them;
• Vision of the future that you are creating, grounded in reality;
• Planning that creates a map for the realization of your vision;
• Team Work that is guided by partnership and accountability, and
• An Empowering Environment that recognizes the power of an environment to shape outcomes and empower people to succeed.
3. Finance and Accounting – Create a Finance and Accounting Department that will ensure that all aspects of the organization’s finances will comply with all applicable procedures and legal requirements, including: a balanced budget; 100% accuracy; and financial reports that are produced accurately and on time, and will be distributed to everyone who has accountability and interest for the financial results.
4. Human Resources – Create a Human Resources Department that supports the hiring of excellent people, ensures that the organization provides an environment in which motivated people can thrive, and vigilantly monitors your compliance with all HR-related legal, administrative and procedural requirements.
5. Programmatic Components: Fully Funded and at Capacity -- Ensure that all your programs are: Fully funded; At capacity or nearly so; Are excellent in both concept and delivery; Always seeking to take that excellence to new levels; Provided the resources – in terms of facilities, technology, staffing, etc. – that they need to succeed; and the most important part, Monitored for program results, and those results shared with funders and with the community, as appropriate, both to comply with grant and contract reporting requirements and to inspire continued funding of programs that make a difference.
6. Fund Development -- Create a Fund Development Department that prepares an Annual Fund Raising Plan; Make prospect identification, qualification and cultivation a regular part of the work; Generate partnership and broad-based participation (by staff members, Board of Directors, volunteers, etc.) in fund-development efforts; Establish and meet interim (pledge and revenue) targets; Be accountable by insuring that results are the Driver; and Thank Generosity -- Acknowledge donors and involve them with your organization, to foster long-term participation and support.
7. Information Technology – Ensure that the hardware and software required to operate the organization is in place; Ensure that it is maintained and upgraded as needed.
8. Internal Audit and Compliance – Engage this “Internal Conscience” that is accountable for ensuring that your organization develops and maintains internal controls to (a) foster accountability, (b) maximize effectiveness of operations, and (c) ensure that the organization complies with all applicable laws and ethical standards
9. Everyone Must Comply -- Ensure that the Board of Directors, the President and CEO, the Executive Management Team, and the Staff comply with all legal, administrative and ethical requirements for the integrity of the organization.
10. Facilities -- Take steps to ensure that all properties owned by the organization are used strategically, or to sell those properties and use the realized gain to further your mission.
There are many fundamental pillars on which the management, quality, and growth of an organization, regardless of the size and sector [NFP vs. FP] in which it operates that are essential for the organization’s success. In these challenging times, I urge that you consider changing or dismantling these key aspects of your organization only after careful consideration and forethought.
For-Profit and Not-for-Profit -- For me there never was a distinction between the NFP and FP worlds. In one, I operated a “Business for Shareholders”; in the other, I operated a “Business with a Heart” but I operated under the fundamental principle that I was running a business.
Fundamental Pillars - The keys that permitted us to succeed in each organization, regardless of the industry or country are simple. Each key has been carefully developed and tested over time.
1. Three to Five-Year Business Plan: Vision and Implementation – Ensure that a three to five-year plan is always in place, casting the vision and intentions out in front of us to guide our day-to-day work.
2. Philosophy and Methodology – Ensure the creation of a common organizational culture marked by:
• Commitment to the children and families that you serve and the staff that
serves them;
• Vision of the future that you are creating, grounded in reality;
• Planning that creates a map for the realization of your vision;
• Team Work that is guided by partnership and accountability, and
• An Empowering Environment that recognizes the power of an environment to shape outcomes and empower people to succeed.
3. Finance and Accounting – Create a Finance and Accounting Department that will ensure that all aspects of the organization’s finances will comply with all applicable procedures and legal requirements, including: a balanced budget; 100% accuracy; and financial reports that are produced accurately and on time, and will be distributed to everyone who has accountability and interest for the financial results.
4. Human Resources – Create a Human Resources Department that supports the hiring of excellent people, ensures that the organization provides an environment in which motivated people can thrive, and vigilantly monitors your compliance with all HR-related legal, administrative and procedural requirements.
5. Programmatic Components: Fully Funded and at Capacity -- Ensure that all your programs are: Fully funded; At capacity or nearly so; Are excellent in both concept and delivery; Always seeking to take that excellence to new levels; Provided the resources – in terms of facilities, technology, staffing, etc. – that they need to succeed; and the most important part, Monitored for program results, and those results shared with funders and with the community, as appropriate, both to comply with grant and contract reporting requirements and to inspire continued funding of programs that make a difference.
6. Fund Development -- Create a Fund Development Department that prepares an Annual Fund Raising Plan; Make prospect identification, qualification and cultivation a regular part of the work; Generate partnership and broad-based participation (by staff members, Board of Directors, volunteers, etc.) in fund-development efforts; Establish and meet interim (pledge and revenue) targets; Be accountable by insuring that results are the Driver; and Thank Generosity -- Acknowledge donors and involve them with your organization, to foster long-term participation and support.
7. Information Technology – Ensure that the hardware and software required to operate the organization is in place; Ensure that it is maintained and upgraded as needed.
8. Internal Audit and Compliance – Engage this “Internal Conscience” that is accountable for ensuring that your organization develops and maintains internal controls to (a) foster accountability, (b) maximize effectiveness of operations, and (c) ensure that the organization complies with all applicable laws and ethical standards
9. Everyone Must Comply -- Ensure that the Board of Directors, the President and CEO, the Executive Management Team, and the Staff comply with all legal, administrative and ethical requirements for the integrity of the organization.
10. Facilities -- Take steps to ensure that all properties owned by the organization are used strategically, or to sell those properties and use the realized gain to further your mission.
Wednesday, August 5, 2009
Why is Cumulative Giving So Neglected?
I've been contributing annually to not one, not two, but at least a half dozen environmental groups for over 35 years. Granted, my gifts have not been huge -- mostly in the $25-50 range -- but they have been consistent. I don't believe I have ever missed a year in all this time. I'm sorry to report that NONE of these organizations has acknowledged my cumulative giving over so many years, or contacted me outside of direct mail. What a shame.
It seems I am invisible to them, just another of the tens of thousands of donors who cycle through their organizations, usually introduced through a direct mail appeal. The difference about me is that I have never stopped giving, while I'm sure many tens of thousands of others have moved on to other charities. After all these years, they know absolutely nothing about me. Here's just a small sampling of what they don't know or what they have ignored:
1. I've moved dozens of times over these years, and every time I made sure to give them my change of address.
2. I'm incredibly loyal. Even after all these years of being treated like someone they've never heard of every time I give, I still keep giving.
3. I'm older now! I'm a member of the cohort of excellent planned giving prospects. I'm low hanging fruit!
4. I live in a major metropolitan area where I'm sure many other donors to these organizations live. They could get us together and bring us much closer to the organization. They are probably ignoring all those donors too.
5. I've been giving unrestricted gifts all these years. Maybe I could be persuaded to support specific projects at a higher level if I were made aware of those opportunities.
I'm re-evaluating my giving to these groups this year for the first time. Frankly, if I wanted to be ignored and under-valued for 35 years I could have stayed married to my first husband!
I deserve better, and this is the year I make my move. I've been giving to a few other groups that show appreciation, keep me informed and make me feel like my gifts matter. I'm going to reward them for knowing how to treat a gal right.
It seems I am invisible to them, just another of the tens of thousands of donors who cycle through their organizations, usually introduced through a direct mail appeal. The difference about me is that I have never stopped giving, while I'm sure many tens of thousands of others have moved on to other charities. After all these years, they know absolutely nothing about me. Here's just a small sampling of what they don't know or what they have ignored:
1. I've moved dozens of times over these years, and every time I made sure to give them my change of address.
2. I'm incredibly loyal. Even after all these years of being treated like someone they've never heard of every time I give, I still keep giving.
3. I'm older now! I'm a member of the cohort of excellent planned giving prospects. I'm low hanging fruit!
4. I live in a major metropolitan area where I'm sure many other donors to these organizations live. They could get us together and bring us much closer to the organization. They are probably ignoring all those donors too.
5. I've been giving unrestricted gifts all these years. Maybe I could be persuaded to support specific projects at a higher level if I were made aware of those opportunities.
I'm re-evaluating my giving to these groups this year for the first time. Frankly, if I wanted to be ignored and under-valued for 35 years I could have stayed married to my first husband!
I deserve better, and this is the year I make my move. I've been giving to a few other groups that show appreciation, keep me informed and make me feel like my gifts matter. I'm going to reward them for knowing how to treat a gal right.
Tuesday, August 4, 2009
Being Publicly-Funded, How Much Must We Disclose?
Q: I was re-reading something you wrote previously on confidentiality versus transparency in the boardroom. You peaked my curiosity. When an organization is operating with "public funds," what degree of "disclosure" is REALLY is required?
A: Can I consider your word “REALLY” to be lower case as I craft my response? In all seriousness, this is a tough question because there are no black and white answers.
The Panel on the Nonprofit Sector, convened by Independent Sector, stated in its final report to Congress in June 2005, “Comprehensive and accurate information about the charitable sector must be available to the public.” They went on to clarify this:
To encourage participation and confidence in the nonprofit sector, the public must have access to accurate, clear, timely and adequate information about the programs, activities, and finances of all charitable organizations. Government regulation should promote such transparency while providing sufficient flexibility to accommodate the wide range of resources and capabilities of nonprofit organizations, particularly of small organizations. (Report to Congress and the Nonprofit Sector on Governance, Transparency and Accountability, p. 21)
Unfortunately, this isn’t very instructive. It doesn’t even give us an idea of what constitutes “small organizations.”
The Internal Revenue Service is a bit more clear. Since 1999, public charities have had to make immediately available to whomever asked copies of their three most recent Form 990's, with all schedules and attachments, along with their exemption application. The only thing that can be redacted is the names and addresses of donors.
With the latest version 990’s, more information than ever before must be shared. This includes new reporting of the organization’s level of public support, any endowment and/or special funds, including donor advised funds, and non-cash contributions. It also requires that a summary of the organization’s mission and activities, as well as its governance structure, policies and practices be shared – including its disclosure practices. Transactions with interested persons, such as board members, must be revealed, as must relationships with professional fund raisers. Even its accounting methods must be spelled out and copies of audited financials or their equivalents provided. (For more information, go to http://www.irs.gov/pub/irs-tege/moving_from_old_to_new.pdf.)
While many organizations rely on GuideStar’s posting of their 990’s to satisfy the disclosure requirements, you might want to consider additional methodologies to communicate to the public how you operate, how you are using its money and the impact you are having in the community as a result. I suggest you work with your PR specialist and your accountant to help you in the presentation of this information. After all, you want people to actually read and understand what you are providing them.
All this having been said, my guess is that you are less concerned about the regulartory issues above and more concerned about how much you should disclose about those issues that come before the board, such as personnel problems, potential lawsuits or pending mergers. I am unaware of any “official” guidelines on this. What I would say, is that your board should have policies in place that spell out how to proceed if – or more likely, “when” – the organization is faced wtih such situations. The policies should indicate if you will disclose information proactively or reactively, the types of trigger points that would cause you to disclose, the manner in which you prefer to disclose – e.g., press conference, news release, email blast – and who shall serve as the spokesperson(s). Here again, working with a PR person, especially one who understands crisis management, is critical. He or she can help you design messages and dissemination strategies that keep the organization in the best light.
In today’s environment, where transparency and trust are paramount and people are re-evaluating the organizations they choose to support, the more information you can provide, even if it is not required, the better.
A: Can I consider your word “REALLY” to be lower case as I craft my response? In all seriousness, this is a tough question because there are no black and white answers.
The Panel on the Nonprofit Sector, convened by Independent Sector, stated in its final report to Congress in June 2005, “Comprehensive and accurate information about the charitable sector must be available to the public.” They went on to clarify this:
To encourage participation and confidence in the nonprofit sector, the public must have access to accurate, clear, timely and adequate information about the programs, activities, and finances of all charitable organizations. Government regulation should promote such transparency while providing sufficient flexibility to accommodate the wide range of resources and capabilities of nonprofit organizations, particularly of small organizations. (Report to Congress and the Nonprofit Sector on Governance, Transparency and Accountability, p. 21)
Unfortunately, this isn’t very instructive. It doesn’t even give us an idea of what constitutes “small organizations.”
The Internal Revenue Service is a bit more clear. Since 1999, public charities have had to make immediately available to whomever asked copies of their three most recent Form 990's, with all schedules and attachments, along with their exemption application. The only thing that can be redacted is the names and addresses of donors.
With the latest version 990’s, more information than ever before must be shared. This includes new reporting of the organization’s level of public support, any endowment and/or special funds, including donor advised funds, and non-cash contributions. It also requires that a summary of the organization’s mission and activities, as well as its governance structure, policies and practices be shared – including its disclosure practices. Transactions with interested persons, such as board members, must be revealed, as must relationships with professional fund raisers. Even its accounting methods must be spelled out and copies of audited financials or their equivalents provided. (For more information, go to http://www.irs.gov/pub/irs-tege/moving_from_old_to_new.pdf.)
While many organizations rely on GuideStar’s posting of their 990’s to satisfy the disclosure requirements, you might want to consider additional methodologies to communicate to the public how you operate, how you are using its money and the impact you are having in the community as a result. I suggest you work with your PR specialist and your accountant to help you in the presentation of this information. After all, you want people to actually read and understand what you are providing them.
All this having been said, my guess is that you are less concerned about the regulartory issues above and more concerned about how much you should disclose about those issues that come before the board, such as personnel problems, potential lawsuits or pending mergers. I am unaware of any “official” guidelines on this. What I would say, is that your board should have policies in place that spell out how to proceed if – or more likely, “when” – the organization is faced wtih such situations. The policies should indicate if you will disclose information proactively or reactively, the types of trigger points that would cause you to disclose, the manner in which you prefer to disclose – e.g., press conference, news release, email blast – and who shall serve as the spokesperson(s). Here again, working with a PR person, especially one who understands crisis management, is critical. He or she can help you design messages and dissemination strategies that keep the organization in the best light.
In today’s environment, where transparency and trust are paramount and people are re-evaluating the organizations they choose to support, the more information you can provide, even if it is not required, the better.
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