When a major gift is finally within reach - after all your blood, sweat, and tears - it’s tempting to tiptoe around the donor to get the gift in hand. There are bills to be paid after all.
But short-sighted behaviour when it’s time to close the gift could hurt you in the long run. A lack of consistency and clarity surrounding major gifts leaves donors feeling burned.
For this month’s edition of Grantseeker Monthly, we sat down with Lucie Rémillard, President at LR STRATÉGIE, and Cathy Barr, Senior VP at Imagine Canada, to chat about the consequences of not having strong gift policies in place. With decades of experience in the charitable sector and through their involvement with the Imagine Canada’s Standards Program, Cathy and Lucie – a former peer reviewer for the Program - are well acquainted with the state of fundraising policies in our sector: the good, the bad, and the ugly.
To begin, what is a “gift acceptance policy”?
“It is the tool that frames the closing of the gift,” Lucie tells us. “The policy clarifies the intent of the organization, the intent of the donor, and brings them together with as much clarity as needed.” Put another way, it is a policy that manages the expectations of your donors but also provides your board and staff with consistent practices for reviewing and accepting gifts.
Are you leaving your legacy at risk?
The goal of a good gift acceptance policy is to protect the future of your donor relationships and ultimately the future revenue of your organization. Here are four reasons to review your fundraising policies in 2015.
1. Burn a donor and they’ll never forget
You have the perfect philanthropist in mind for your current campaign. In 2008 they gave a sizeable donation, one of the largest your charity has ever received, and their business is doing well. Even better, the message in your campaign is right up their alley. Linkage, ability, and interest are all aligned.
But after asking around, you discover there is no memorandum of understanding (MOU) from 2008, no indication of what the donor expected from that gift or what your organization promised, and the fundraiser who secured the donation is long gone.
If you can relate to this, you’re not alone. Lucie shares how she frequently encounters charities in this awkward position. “When we look at their records they know nothing about their previous donors. And the donor remembers. You’re in a very awkward situation and it shows you’re not very serious about the commitment [they made] towards your organization.”
2. You’re not just harming yourself
“A lack of policies not only affects the charities involved,” says Cathy. “It has a ripple effect on other charities that are similar, or in fact on the whole charitable sector.” For example, if a donor makes what they view as a substantial gift to a health charity that is not properly stewarded - or worse, forgotten altogether - their attitudes towards health charities as a whole are likely to change.
3. If you don’t have gift policies, your donor will write them for you
Donors, especially corporations, increasingly expect that some version of an MOU will be provided for large gifts. Donors desire clarity and security for their investments. “By not having our own gift acceptance policies or memorandum of understanding, [the donor will] frame it for us.” Lucie tells us that she often sees individual donors and corporations imposing their own policies when a charity has nothing to propose.
Small organizations may be reluctant to suggest the terms for a donation for fear of losing the donation altogether. But Cathy believes most donors are receptive to suggestions made by the charity. “I think the reluctance to engage in that conversation is misplaced. Donors want to know you are taking them and their gift serious and establishing clear terms sends that message.”
4. Don’t miss an opportunity to delight donors
Stellar gift acceptance policies can help your charity offer an outstanding donor experience. They ensure consistent interactions with your donors, and re-enforce feelings of trust and professionalism. Embrace your policies as strategic tools to grow loyalty, rather than something to check off a list.
Resources for creating or improving your policies
Do your gift acceptance policies measure up or are they hindering your future prosperity? We’ve compiled a list of resources and templates to help your organization ensure it has strong policies that contribute to a great donor experience.
- Considerations in Developing Gift Acceptance Policies (Carters) – A presentation on the importance of policies, examples of use, and key considerations to be included in every gift acceptance policy.
- Developing fundraising policies and procedures: best practices for accountability and transparency (Association of Fundraising Professionals) - A thorough AFP guide to developing fundraising policies, which includes sample policies. Although written in 2007, this PDF contains timeless best practices.
- Examples of Gift Acceptance Policies (Grantspace) – Example gift acceptance policies from a number of diverse organizations.
- Gift Acceptance Policies (National Council of Nonprofits) - Practice pointers, a list of resources, and sample gift acceptance policies.
- Hot Topic: Fundraising Policies (Association of Fundraising Professionals) – [AFP members only] A helpful guide to policy creation, found in the AFP Resource Center.
- Standard C12 Explained (Sector Source) – Organizations accredited through the Standards Program are expected to have gift policies in place. This resource explains the objective and elements of appropriate fundraising policies.
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