I was reading a blog post on 101fundraising by Hanneke Warrink, a fundraiser in the Netherlands, about how she was confronted by the media regarding costs, following the out-of-context publication of the amount her charity had spent on a particular project.
She has my sympathy – and no doubt the sympathy of many other fundraisers out there. Research amongst donors perpetually confirms that they believe we spend too much on ‘administration’. Personally, having worked in both private and public sectors, I feel that we in fundraising need to be braver about justifying our costs to funders.
Consider the irony: If a company makes a margin of 25%, they are thought to be doing quite well. If a charity makes a margin of anything less than 90%, they are thought to be doing badly. And as to the plethora of rules and regulations that charities must operate under – everything from data protection to restricted/unrestricted funding, running of raffles, etc etc – I think it’s quite amazing that we spend as little as we do on fundraising!
But of course, the general public are unlikely to understand unless we explain it to them. On the occasions when I’ve been confronted about costs by donors, a brief explanation of the above leaves most people satisfied that actually costs are necessary for the good of both donors and beneficiaries.
My own personal take, as one who is also a donor, is this: There is no greater privilege than to give unrestricted donations to a charity I really like. I know perfectly well that my donation will go on overheads, salaries of staff, strategy and planning, design of literature or the website, and I’m delighted! Because I look at it this way: If my charity spends 10% on ‘administration’, then for every unrestricted £1 I donate, they will be able to leverage another £9 to directly help beneficiaries.
So giving unrestricted funding provides superb value for money to donors, and ultimately, in the example above, multiplies the impact of my donation tenfold. Now, what donor wouldn’t be happy with that?