What Wrong with the Way We Count Giving?

evaluating fundraising Feb 23, 2021

Okay, I’m going to start a huge firestorm here by questioning a revered source of fundraising statistics.

Giving USA has been around a long time and is one of the most respected sources of giving statistics in the United States. But I’d like to question the statistics, and maybe the even the sources of these statistics!

Our first premise is why the statistics reported have a separate category for bequests. Bequests are not a source of giving; they are a method of giving used by individuals (which is a category). I believe categories should include individuals, foundations, organizations, and businesses.

So, you notice right away these are only two of these categories are used by Giving USA, and I didn’t mention one of its categories—corporations.

Why didn’t I use the category “corporations?” Corporations account for 5 percent of the businesses in the United States, although they account for 62 percent of revenues. So, what happens to the other 95 percent of business that account for 38 percent of revenues? Are they in cyberspace?

Statistics show that the Fortune 100 companies are not as generous as all companies combined.  In fact, they give 10 percent of gross incomes, compared to 13 percent given by all companies. So, why are these LLCs and sole proprietorships not being counted? we’re doing a real disservice to 95 percent of businesses in this country, discounting their philanthropic contributions, and encouraging nonprofits to think only in terms of corporations when they could be raising a lot of money from other business sources.

Another thing about corporate philanthropy is that it does not include corporate sponsorships, which accounts for the bulk of money raised from corporations in many nonprofits. While it’s true these sponsorships are not coming from the philanthropic arm, but usually from the marketing budget, they should be counted. Does it help the nonprofit and go into its fundraising budget? You bet it does. So why aren’t I counting them?

Now, before I go any further, I admit that Giving USA can only report statistics they are given. So how are you counting gifts?

Are you counting gifts from corporate foundations as a business gift or as a foundation gift? Remember those corporate foundations are funded by the businesses who set them up.

Are you counting matching gifts from companies as individual gifts or from the businesses who actually give these matching gifts?

Also, Giving USA has no category for organizations, while most fundraisers accept and often depend heavily on gets form religious institutions, service clubs and professional associations, and even other nonprofits. So where is this money being reported? As far as I can see—nowhere.

So, when you track your gifts, I suggest having four categories in your software system, foundations (which you can abbreviate FO), businesses or companies (CO), organizations (OR), and individuals (IN). And please make sure you are counting all gifts in the proper category. Who knows, maybe I’ll get Giving USA to change its way of reporting and maybe I’ll show the true value of philanthropy.

To learn more about the basics of fundraising, including how to track giving, take my course, Your Fundraising Roadmap. Sign up here

 

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