It’s perfectly natural that individual donors should care how we as organisations spend their money. But it’s time we moved the discourse beyond percentage spend on fundraising.
Focusing too heavily on the amount an organisation spends on fundraising is not only misleading, but can also risk insulting the intelligence of donors by trading in oversimplifications. If you look at one organisation’s accounts next to another, you will essentially be comparing apples and oranges because the way "fundraising spend" is defined can differ so much.
Seeing the raw figures on the page also fails to take into account other factors.
For example, the fundraising team at a campaigning organisation might recruit new donors through petition actions hosted on a third-party site. The spend sits in fundraising and donor leads are recruited for conversion, but the activity advances organisational and campaigning aims.
This is something an individual donor is understandably unlikely to be thinking about when they look at the percentage spend for the year on fundraising.
Another major factor that can contribute to confusion here is the long-term picture. For example, a donor looks at charity X and sees that it is spending 20 per cent of its turnover on fundraising, then compares it with charity Y, which is spending 35 per cent.
Seeing these figures side by side portrays none of the context. Perhaps charity Y has an investment plan over a period of years that is projected to significantly increase income, while charity X is simply maintaining its individual income or possibly seeing it decline.
Does it make more sense for a donor to judge organisations on how little they can spend on fundraising or on their impact? Over time, charity Y might be spending more on fundraising, but the 35 per cent slice is being taken from a larger pie. We as fundraisers need to make the case that investing in our futures is a key part of maintaining and growing the causes that are close to people’s hearts.
My arguments here are certainly nothing new. The American social entrepreneur and third sector advocate Dan Pallotta made similar arguments years ago in his much lauded Ted Talk on the ways in which we frame charity and the third sector.
It is essential that fundraising spend is reframed as not only an essential part of an NGO doing business, but also as a key driver of an organisation’s outputs and therefore a fundamental way in which our messages reach people and, in turn, multiply the good that we all aim to achieve.
Dividing fundraising spend from the rest of an organisation’s expenditure – in essence, saying it is something dirty or feeding the idea that we should in some way be ashamed of it – only serves to create a false dichotomy between what we spend on our "real work" and what is perceived too often to be a frivolity or a waste.
We have many excellent sector bodies in the UK, but what we don’t have is an equivalent to the US Charity Defense Council – a body that proactively makes the case for judging an organisation on its impact, as well as communicating the case for NGOs when they come under attack. I personally love the stark simplicity of its billboards: "Don’t ask if a charity has low overhead. Ask if they have big impact."
Fundraising organisations have weathered numerous storms in recent years. These have often, rightly, caused many in the sector to pause for thought.
But there is also a great deal of misinformation out there, which serves only to cloud the judgement of potential supporters. It is the responsibility of organisations to educate the public on how they must operate and move the discussion beyond who can spend the least on overheads.
It can be a difficult case to make, but in time I hope that impact – and not fundraising spend – can become the yardstick by which we are measured.
Andrew Taylor-Dawson is development manager at the human rights organisation Liberty