It’s February, and that means it is tax time in my household. Reams of paper enough to kill an entire forest are gathered, to file FAFSA government education forms, and to document taxable deductions for my development consulting business and family IRS forms.
One of the deductions that I pay particular attention to is the charitable tax deduction. I calculate what percentage of my income did my charitable contributions represent. Remember when Al Gore was Vice President and he raised eyebrows by giving less than 1% of his income (aprox. $200K) to charity? Note to people who make more than $150K, that was widely considered to be stingy and below the national average (3.5%). Continue reading “DO YOUR CHARITABLE CONTRIBUTIONS TELL ME WHO YOU ARE?”
This autumn I had the pleasure of listening to Panera Bread CEO Ronald Saich speak about his Panera Cares initiative. As a business in the food industry, his company gave away fresh baked goods daily. Even though he was making huge in-kind donations to food banks and shelters, he felt disconnected from really making a difference.
Because he “goes to work to learn” (me too!), he thought about how he and his 8,000 employees could make a significant difference. He wanted to utilize and leverage his company’s strengths in service of others. He also wanted to raise awareness about food insecurity in the U.S., so he researched community cafes that fed the hungry. He also worked in food pantries, and experienced them as a customer – which he described as very powerful.
Continue reading “What Nonprofits can learn from Panera’s CEO”
To raise money in a competitive environment, you not only need a compelling mission (e.g. reason), but also the savvy to prove why you are worth donating to again and again. Here are common subliminal and overt actions/messages that can keep you from successfully raising more.
1) The Board of Directors (Trustees) and/or senior staff members do not contribute to their organization. Can you spell Vote of No Confidence? If the people who know and love the organization the best don’t give, why would anyone else? People do look for this in annual reports, and some foundations/corporations actually ask for the percentage of the Board that makes cash donations. Continue reading “DO YOU SABOTAGE YOURSELF FROM RAISING MORE MONEY?”
Many smart business people like to pay people based on a percentage of their performance. If you make more sales, get more contracts, you get a bigger cut of the business brought in. The number one question I have been asked over time is if I am paid though a percentage of grant funds that I obtain.
The answer is no – never. Like most other professionals, I charge a flat hourly fee. Development professionals who are members of the Association of Fundraising Professionals abide by a strict code of ethics that forbids percentage-based compensation, since it is a conflict of interest. What? Many business people work under a percentage-based model, you say. And that is correct.
But non-profit organizations are fundamentally different than for-profit organizations. The mission of a non-profit is not to make money, like their for-business counterparts, but rather to meet a community need. The business of philanthropy is to meet community needs, for which individuals get a tax write off. If you insert a person in between your organization and Ms. Big Donor or Mr. Foundation to raise money, you want to be sure that person has your best interest in mind, not theirs.
Continue reading “WHY PERCENTAGE-BASED COMPENSATION IS BAD NPO BUSINESS”
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