I strongly recommend all of you who (still!) read this blog and who work in nonprofits, care about the role of service in our communities, have been served or have served a non profit, (etc. etc. etc.) to read Vu Le’s post, General operating funds, admin expenses, and why we nonprofits are our own worst enemies . So that means ALL of you who are readers from the US. And this applies to NGOs as well, so that probably means ALL of you.
I have worked for non profits as staff, consultant and/or volunteer most of my adult life and all I can say to Vu is AMEN! The farce of fundraising language used to drive me crazy as a non profit staffer. The way we fund and account for money in US non profits is insane, and take that in the context of the proliferation of non profits, the whole thing starts sinking. And if you think the US is crazy, look into large NGOs and UN agencies. Mama mia!
And at whose expense is this farce? Those we seek to serve. So get our your checkbook, bitcoin, credit card or even cash. Walk over to your favorite non profit and give them money with no strings.
Accountability you say? Here is the magic sauce. After you fork over your money, fork over your time. Pay attention to what’s happening around you. Then you become part of the real accountability process. Is something good happening that the organization with and for its constituency? Is there learning happening through both successes and failures? Are more people talking about and aware of the organization and its mission, bringing in more support?
Vu also outlined 7 ways non profit staff can help shift towards more honest funding and accountability. I’m putting in some snippets here:
Stop saying “100% (or 98%, or 95% or whatever) of your donations go into programming.” …The next time you attend a fundraising event that says “100% of your donations…,” forward them this blog post. Or, raise your paddle and then loudly proclaim, “I want my donations to support administrative expenses!”
Publicly recognize funders who support general operating funds. …These are our strongest allies, like Unmi Song of the Lloyd A. Fry Foundation or Paul Shoemaker of Social Venture Partners.
Stop using the term “overhead” or “indirect.” We need to change these crappy words and phrases with all the negative connotations. …From now on, in all our annual reports and in general, let’s call it “critical infrastructure” or “core support” or “Things We Need in Order to Do Our Jobs and Make the World Better Dammit” (TWNODOJMWBD)
Stop artificially deflating numbers and apologizing for percentage spent on critical infrastructure….“There is no standardized way to calculate admin expenses, so the comparison is meaningless. Plus, we strongly believe that investing in critical infrastructure like staff development leads to much better outcomes.”
Stop seeking the approval of charity watchdog organizations like Charity Navigator, Charity Watch, and Better Business Bureau/Wise Giving Alliance. …until they figure out a way to accurately measure organizations’ effectiveness, their rankings are misleading and distracting.
Write in a line-item for reserve funds in your organization’s operating budget. … Build in a line for reserves, and if anyone whines about it, explain why it’s important and ask them to support it or else to stop asking about sustainability.
Push back, and be willing to lose a funder. …Sometimes, telling the truth or refusing to break down our expenses and forcing people to focus on outcomes, or refusing to accept funds to do things that would ultimately cost us more than it brings in revenues, may cost us a funder or donor, but this short-term sacrifice may be far better for our organization and for our sector in the long run.
I’ve forked over my money. Now I have to hold ME accountable and return to forking over time.
A confession: A few years ago I did some work for Social Venture Partners here in Seattle. I was deeply impressed with how they operated at every level and their strong intentions to see and work at a systems level. I almost became an investor, but personally felt outside of the culture of the other investors so I shied away. But as I read Vu’s comments about the value and importance of how SVP invests in its communities with both money and time, I am reminded how important these approaches are. Whether I join an SVP, or I find a kindred approach, I reconfirm my intention that it is not just what we do to support our communities, but how we do. And funding all facets of the work is critical.