Back in June, in response to the toppling of the statue of Edward Colston in Bristol and the Black Lives Matter movement, I shared some reflections on the issues facing philanthropy.
My argument in a nutshell was this: philanthropy is inextricably tied with extreme wealth, and most of that wealth is derived from activities that increase inequality. Philanthropy gives a particular audience – wealthy, privileged, mostly white, usually male – disproportionate influence over the sector’s work and policies, and an opportunity to implement a vision of social change that is likely very different from your own. This process is inadvertently endorsed every day by fundraisers and charities – so while Edward Colston is an extreme and high-profile case, there are other examples everywhere.
I’m delighted that this blog sparked plenty of debate and discussion, but I’m conscious it offered little by way of solutions. The truth is, it’s very difficult for most fundraisers to take action, especially if their organisation isn’t geared up to question philanthropy.
Several people rightly asked for some thoughts on what organisations can actually do differently, rather than just why it’s important. This is where things get trickier, and more controversial, but here are my views…
Reduce your long-term dependence on philanthropy
Let’s deal with the elephant in the room. It’s all very well not wanting to accept certain donations - but in the current climate, for many, it’s not unreasonable to think that turning away a big gift could lead to service closures or staff redundancies.
I can’t pretend there’s a quick or easy answer to this. But we’ve previously shared various thoughts about diversifying your income, which will inevitably reduce your reliance on a single funder, donor or income stream, and make it easier to stick to your principles.
This 2018 blog explores how to build a business case to persuade your organisation to invest in developing a more diverse fundraising portfolio. And in this podcast, I interview Fran Ferris-Ockwell, former CEO of a Sheffield housing charity, on how she guided them through a process to reduce their reliance on contract income, with huge improvements to their independence and organisational culture.
Most organisations won’t be able to reduce their dependence on funders and major donors overnight, but these steps are a key starting point – particularly if you're brave enough to set an explicit long-term strategic objective to become less dependent on grants and major gifts over several years.
Create a fit-for-purpose ethical fundraising policy
We previously shared six guiding principles about creating an ethical policy. While it might be tempting to find a policy template online and quickly adapt it, the most important part of this exercise is having an honest and meaningful conversation with your management team and trustees. You should develop guidelines that feel appropriate for your organisation, mission and service users. Don’t expect this to be an easy exercise, or for everyone to immediately agree, as you’re dealing with a complex issue.
Be aware that enforcing your policy to the letter might lead to both accepting or rejecting donations in controversial circumstances later. This could conceivably lead to negative press coverage, complaints from supporters, disagreements with staff and trustees, or having to close a service. You need to fully anticipate and ‘test’ the potential consequences of your policy, so you can confidently justify decisions later.
Empower your fundraisers and lead by example
After publishing our original blog in June, I was contacted by several fundraisers sharing experiences where they felt uncomfortable about the ethical implications of a donation or a donor’s behaviour, but felt unable to act. For example:
Your ‘front line’ fundraisers are likely to be younger, less experienced and less influential than your donor prospects, management and trustees. They may well be working under pressure, knowing that failing to hit financial targets could well harm the organisation’s financial health, staff livelihoods and service users. So even if a fundraiser feels uncomfortable about something, voicing this might feel daunting and detrimental to their career.
Solving this actually goes beyond having an ethical fundraising policy, particularly one that sits in a drawer gathering dust. Your senior management and trustees need to lead by example by openly talking about the ethical issues with philanthropy, and creating opportunities for fundraisers to raise concerns and ask questions without fearing a backlash.
Something else to consider: is your approach to setting fundraising targets and KPIs creating an environment where fundraisers feel pressured to stay silent and bring in donations at all costs? Unrealistic targets - particularly those based purely on the cost of your projects rather than sector benchmark data, are another potential barrier to thoughtful and ethical fundraising.
Move beyond #donorlove
This feels controversial - when I suggested this on Twitter, I was met with some incredulous responses.
#donorlove is a popular term to describe a donor-centric approach to fundraising that focuses on making donors feel loved, valued and appreciated, to encourage and retain their support. This isn’t totally without merit - many organisations don’t do this, and miss out on donations as a result. I’ve previously shared my own experiences as a donor and why charities should get better at saying thank you.
But too often, #donorlove crosses into advocating putting the donor’s wishes and the importance of building a relationship with them above other concerns. I’ve seen high-profile consultants advise charities to structure annual reports entirely around recognising the contributions and achievements of the donor, even if their service users fade into the background as a result.
I think you can make a case for #donorlove being incompatible with the need to re-examine philanthropy in response to recent events - and an inadvertent endorsement of hypocritical philanthropy, the problematic influence of wealthy donors and the white saviour complex. When fundraisers are faced with the pressure of a financial crisis, silence from their senior leadership, and influential fundraisers’ unswerving commitment to #donorlove, is it really any surprise that they feel unable to do things differently?
I doubt that #donorlove is going anywhere fast - too many high-profile fundraisers and consultants have structured their livelihoods around the concept - but perhaps we need to start taking the first steps.
Challenge how we structure, incentivise and culturally revere philanthropy
Philanthropy is commonly considered an unselfish, freely-taken individual act that increases equality and is open to everyone. Cast in this light, what right do we have to challenge where that money comes from, or how it is used?
Unfortunately, this view of philanthropy is false.
In his book “Just Giving: Why Philanthropy Is Failing Democracy and How It Can Do Better”, Rob Reich examines the philanthropic landscape in the US and reaches two uncomfortable conclusions. Firstly, less than a third of charitable giving actually benefits low-income people. Secondly, the US tax system is massively skewed towards rewarding and incentivising the wealthiest donors: if you earn under $153,100 per year then a $100 donation costs you $100, whereas it can cost a higher earner as little as $60.
Admittedly the UK landscape is somewhat different, not least because we have a Gift Aid scheme rather than just tax breaks for the donor. But essentially, the same problem exists globally: the tax system greatly subsidises charitable giving and enables richer people to donate money at less personal cost. This actually takes money out of the public purse and redirects it towards causes favoured by the rich and powerful, which rarely benefit low-income people. Philanthropy therefore can actually harm rather than help equality.
Reframing philanthropy in this way completely changes our right and obligation to challenge it. For example, how much influence and recognition should a wealthy donor enjoy for their supposedly ‘selfless’ gift? Should we permit a family trust to be opaque about where its money comes from, and how it decides which causes to support? Why can’t we create and enforce a new code of ethics and transparency, and remove the huge tax breaks for funders and donors who won’t play ball?
In barely 100 years, we’ve gone from elite-level philanthropy being met with suspicion and fierce criticism - Rob Reich documents the angry response to John Rockefeller’s early attempts to establish his charitable foundation in the US in the early 1900s - to today’s almost unquestioning endorsement of philanthropy and #donorlove.
In keeping with the positive response to the toppling of Edward Colston’s statue and the Black Lives Matter movement, I think we urgently need to start nudging back in the other direction.
In our Fundraising During Covid-19 online briefing last week, five different fundraising specialists talked about their recent experiences and what organisations should be looking out for in the next 6-12 months. Here are six lessons from the briefing for fundraisers far and wide...
Firstly, a huge thanks to our panel of four external speakers:
1. People are still giving...
The headline news from all our speakers was that, for the most part, people are still donating and fundraising.
Research in May showed that one-third of UK donors were actually donating more than pre-Covid-19. Louisa highlighted the phenomenal success of mass participation virtual events like the 2.6 Challenge. Claire said that while many charities felt uncomfortable talking about legacies in the early months of the pandemic and stopped doing so, the Law Society actually reported a dramatic growth in will writing - potentially an opportunity missed for the sector. Some charities have been working sensitively with executors to speed up legacy payments to help with cash flow problems.
I shared this example of a small family trust that are still giving, and doing what they can to show flexibility and understanding:
They may be facing their own challenges, but funders and donors are also responding to events around them - stories in the news, or experiences of illness or tragedy closer to home - which are often prompts for wanting to support good causes.
2. …but they're also facing new pressures
While people are still giving, many are feeling the strain of the pandemic – financially, emotionally and in terms of time/capacity. With a recession around the corner and dividend income down, some philanthropists may hesitate about donating, and some companies are slashing Corporate Social Responsibility budgets. Trusts and foundations will be dealing with the same logistical challenges as you – staff furloughed, unwell or struggling with childcare, meetings postponed, and technology hiccups.
In such uncertain times, it’s easy to talk yourself out of asking for money at all. This is a mistake. If you don’t ask, you’re denying your funders and supporters an opportunity too, and somebody else will them instead. It’s fine to ask, but be conscious of the challenges people might be experiencing currently, don’t put them under pressure, and listen and respond to feedback.
Contact companies and trusts to check on their current situation before applying, to avoid wasting your time and theirs. Listen carefully to your prospective major donors - as Lottie explained, hearing ‘no’ might not be an absolute rejection, but could just mean no to that amount, no for the next six months, or no to that particular project.
3. Relationships remain crucial, but adapt your approach to building them
Building relationships is one of our seven universal fundraising rules that will never let you down. But developing relationships amid social distancing, and when your time is stretched, is difficult. While it's been a pleasant surprise just how much can be achieved online in recent months, there's no easy substitute for face-to-face interaction when it comes to getting to know supporters or getting introduced to new contacts.
Nevertheless, we mustn’t abandon our attempts to build meaningful relationships. Harpreet told attendees that now is the time to be creative, test new channels, and invest time in ideas and conversations on social media. It could also be a good time to re-examine your lawful basis for getting in touch with your supporters – Harpreet observed that many charities haven’t communicated with some supporters since 2018 because they didn’t give opt-in consent when GDPR came in, but some of these supporters may never have understood why they stopped being contacted. You could explore using ‘legitimate interests’ to get back in touch now.
If cancelled events have freed up budget and staff time, consider investing this in phoning supporters and being more active and visible on social media. Don’t hold off communicating with supporters because you don’t have a specific ask ready. Phone them anyway, even just to ask how they’re doing or to update them on your work. Investing time in relationships now will lead to stronger support and donations tomorrow.
4. Keep externalising your case for support
Drawing on her experience in the arts sector, Lottie observed how many organisations have recently asked for money to ‘keep their doors open’ or avoid laying off staff. Sadly, while this is paramount to you, it's unlikely to be compelling to your donors, unless they’re extremely invested in your organisation.
Donors care about the people you support and the positive impact of your work, not keeping you afloat. So you need to be telling inspiring stories and presenting a clear case for support that explains who you help, why they need support, what you do to meet the need, the impact of your work, and why you’re best placed to achieve change.
Virtually all our speakers highlighted the importance of a good case for support - for funding applications, individual giving campaigns, major donor asks and legacy fundraising. It’s more important than ever during a crisis, with so many organisations competing for donations and emergency funding. One possible negative impact of the recent Government bailouts for the charity sector and the arts is that the general public might mistakenly perceive that charities are now well-funded. The reality is that these bailouts are tiny in the face of rising need, but it’s up to you to make this case to your supporters.
5. Maintain quality and good practice
We asked our speakers to explain what hasn’t changed in fundraising since Covid-19, as well as what has - and it was abundantly clear that good practice doesn’t go out the window when a crisis strikes.
Time and again, our speakers emphasised the importance of doing things the right way, even when there's a sense of urgency. Louisa talked about the need to plan events well in advance and budget very carefully, especially when social distancing might mean your events have to be smaller-scale and less profitable. Claire highlighted the need to maintain common good practice in legacy fundraising: not leading with a scary focus on death, taking a ‘drip drip’ marketing approach, and always respecting donors’ wishes and wellbeing.
It’s easier to keep an emphasis on quality and good practice when you don’t overcommit. For example, you’re likely to make a better impression - and raise more money - if you take the time to write three emergency funding applications well, rather than rushing out eight poor-quality bids.
6. We’re all still figuring things out - so be curious, flexible and kind
Harpreet put it best when she said that right now, fundraisers have to be comfortable not knowing all the answers, as we’re all feeling our way in the dark. This is an unprecedented crisis – nobody really knows what is round the corner, or which fundraising tactics will yield the best response. So I believe we need to do three things:
Be curious - test out new messages and ways of communicating with supporters, before committing significant time and budget to them. Measure and reflect on the results. Monitor what other organisations are doing well, and badly. Ask other fundraisers for advice, and sign up for events where people share observations and best practice.
Be flexible - lockdown restrictions and public mood are liable to change quickly, so be ready to respond. Your Senior Management Team will need to be more agile and get used to signing off ideas more quickly, or your organisation could be left behind.
Be kind - it’s ok to not know what’s round the corner, to make mistakes, and to sometimes just feel overwhelmed and despondent. Equally, Louisa mentioned the importance of celebrating your successes when they come – this keeps you feeling positive, makes the inevitable rejections easier to deal with, and boosts colleagues’ moods too.
Time will tell, but I really hope the last couple of weeks will be a landmark moment in history, with the Black Lives Matter movement gathering widespread support, and people doing some genuine, long-overdue soul-searching about racial inequality. Bristol, where I live, has felt like the epicentre of grassroots change, with the dramatic toppling of the statue of Edward Colston.
Bristol is a city haunted by the slave trade, and this statue has been a focal point of the long debate about the legacy of Edward Colston. It's important to remember that the statue is very much the tip of the iceberg – at last count, Bristol ‘boasts’ eight streets, two pubs, two schools, a fruity bun and the city’s largest music venue named after Colston.
Disentangling the messy web spun by such a prolific philanthropist has proved complicated, particularly as change has long been opposed by influential philanthropists in Bristol. People only took matters into their own hands after many tried - unsuccessfully - to find a democratic solution for years.
This is something to be celebrated - and many have been, including the CEO of the Wolfson Foundation:
I want to agree with this sentiment, but actually I think we're at the very beginning of the argument, not the end. While few people would actively argue that philanthropy excuses the unethical practices that first generated that money, this view is inadvertently endorsed every day - and fundraisers and charities are very much complicit in this. There are examples everywhere, once you start to look.
The day after the statue came down, I felt this strange need to go down to the site myself, and just...think. I started writing this blog down there.
Looming above the smashed plinth and handful of people still milling about was Colston Tower - a building that can’t be torn down by people who are fed up of waiting for official action. If Bristol wants to fully rid itself of the Colston legacy, this is going to take a conscious decision from those in power whose track record - no matter they say - still suggests they believe that philanthropic good deeds outweigh harmful past actions.
Of course, this isn't just a Bristol problem. London's Tate Galleries take their name from Henry Tate, whose company Tate & Lyle was inextricably tied with the sugar industry and the slave trade.
A great many museums have received large donations from the Sackler Trust, and some bear the Sackler name. You might well know that the Sackler Trust was closely linked to Purdue Pharma, who are accused of fuelling the US opioid crisis and spent years aggressively pursuing legal action so they could continue selling their highly addictive drugs.
But we're on safer ground with most corporate foundations, right? I know countless grassroots community projects that have benefitted from grants connected to the banking sector - think Santander Foundation, the RBS Skills and Opportunities Fund, and Barclays' new 100x100 UK COVID-19 Community Relief Programme. Yet a 2018 report by Ethical Consumer magazine said this:
How many charities write ethical fundraising policies that prohibit donations from philanthropists involved in these 'problem sectors', but wouldn’t think twice about applying for a grant from a foundation connected to one of the big five banks?
The trouble is that while most people have clear views about Edward Colston, underneath this there's a huge grey area. And the more you dig, the greyer it gets.
Many social welfare charities are funded by wealthy family trusts whose trustees have, for decades, both implemented and supported policies that drive a coach and horses through social mobility. Their businesses often pay as little tax as possible and profit greatly from things like zero hours contracts - which keep vast numbers of people, including so many charity service users, locked in poverty.
2020 brought a new entrant to the UK trusts and foundations scene: the Hargreaves Foundation – founded by Peter Hargreaves, major donor to the Leave.EU Brexit campaign, friend of Jacob Rees-Mogg, and a man who outlined his employment policies and interest in charities in an interview with The Sunday Times:
And I recently discovered this remarkable exclusion from a small family trust in Oxfordshire: “We will not support charities that in our view are ambivalent about, or actively campaign for the abolition of, field sports.” Imagine being so vehemently pro-field sports that you simply wouldn’t consider funding a charity that has even mixed feelings about fox-hunting?!
Does any of this really matter? Where should we draw the line?
Should we only reject money from those who have been publicly condemned for doing Very Bad Things? Or are harmful but widespread business practices up for scrutiny too? When should we take people's publicly held opinions into account - when they actively harm our beneficiaries, when they go against our charity's message, or when we just find them personally repugnant?
I'm not saying everyone will take issue will all of the above examples - or that you should. But it's an important conversation to have. And I think that recent events in Bristol should mark the beginning of the argument about hypocritical philanthropy, not the end.
It's an inescapable fact that philanthropy is closely tied with extreme wealth, and most of that wealth is derived from activities that increase inequality. Philanthropy often buys people 'a seat at the table', and this gives a particular audience – wealthy, privileged, mostly white, usually male – disproportionate influence to implement their own vision of equality, social mobility and climate change. A vision that is, almost certainly, very different from your own.
If we want to address this, we’re going to have to start digging a lot deeper than Edward Colston.
Like this blog? If so then please...