GuideStar

Is there a place for secrecy and anonymity in philanthropy? Some argue that there probably should be a place for anonymous giving and for privacy when setting and executing grantmaking strategy. It has become clear that secrecy isn’t really possible anymore. Technology and a shift in societal expectations have completely changed the game. Gone are the days when foundations and other donors could operate quietly below the radar. Those who give away large sums must get on board the transparency train or expect to get run over by it.

For most people, giving money to charity feels great. Asking for the money back is a whole different story. Yet philanthropy experts say donors increasingly are doing just that: requesting “refunds” on gifts they feel have been misused, ignored or spent in a way that strays from their original reason for giving.

The ease of accessing financial data on the Internet, as well as a string of high-profile court battles involving donors seeking refunds, are behind the shift, experts say.

Most of us are alarmed by the almost unbelievable disparity in Ferguson’s civic life that is fueling the protests. African-Americans are two-thirds of the city’s population, but whites serve as mayor, five of six city councilors, six of seven school board members and 50 of 52 police officers.

However, are we alarmed at the nonprofit sector’s own lack of representation? Despite groundbreaking efforts by the Center for Diversity and the Environment, the D5 Coalition, Green 2.0 and New Generation of African-American Philanthropists, the glaring disparity in nonprofit leadership bears a striking similarity to Ferguson.

(Press release, October 21, 2014) — As Americans donate generously this holiday season, the three CEOs of the leading information sources on nonprofits — GuideStar, Charity Navigator and BBB Wise Giving Alliance — issued a joint letter urging charities to help crush the false notion that overhead ratios serve as the sole basis for trusting a charity and to help move toward an Overhead Solution by demonstrating ethical practices, managing toward results and educating funders.

GuideStar announced an important new initiative to monitor the diversity of the nonprofit sector. It plans to work with the D5 Coalition and a range of other partners to collect diversity data about staff, board and volunteer demographics in nonprofits and philanthropy. Saying that past sporadic attempts to collect such information were inadequate, Kelly Brown, director of the D5 coalition, said that the end game of the project is diversity in the sector that is reflective of current demographics but also inclusion and equity.

Does staff size affect grantseeking activities and success? The short answer is "yes," but let's looks at some of the data that are available. Because all-volunteer organizations usually lack personnel dedicated to grantseeking, it becomes a less consistent, ad hoc affair, resulting in few awards. Moving an organization from all volunteer to having one to five employees increases the likelihood of grant funding; moving the organization to six to 10 employees increases that possibility even more.

It’s time for us to help donors more accurately evaluate nonprofits as they choose organizations to support. Enter the DMA Nonprofit Federation's Nonprofit Dashboard.

It may be hard to justify diverting money from programs to start an endowment. There is, however, another way to look at endowments: as part of good financial planning that ensures that an organization will be around in the future to carry out its mission. Here is a five-step plan that a smaller nonprofit can use to create an endowment — and put itself on solid financial footing.

GuideStar and Venable, LLP are presenting a free webinar to help demystify nonprofit tax laws. Our speaker, Jeffrey S. Tenenbaum chairs the nonprofit practice of one of the nation's leading law firms. Come armed with your questions and join us for a webinar you cannot afford to miss!

When your newsletter arrives, the first thing donors do is browse: skim a few headlines, look at the photos, maybe read a caption, to see if anything's of interest. If nothing is, they put the newsletter aside, likely never to return. Which means, if you have nothing of interest in your "browser level," you've wasted your time and money. Don't expect donors to read deep because most of them won't. Instead of saying, "When people read our newsletter …" start saying, "When people skim our newsletter, this is what they will learn."