The following is a guest post by Dean Vella, a writer about business and nonprofit leadership on behalf of University Alliance, a facilitator of transformational leadership and leading nonprofit boards courses.
“Trust” is a substantial word, bestowed with a great deal of weight in our lexicon. Whether we’re navigating our personal or business lives, trust implies a responsibility that can define a relationship – or damage it.
It’s not easy for nonprofit organizations to build long-lasting, trust-based relationships with donors. These days, people have plenty of misgivings about charities, some of them legitimate:
- Does it spend too much on administration and salaries?
- Do donations actually help people in need?
- Are they overspending on that fancy fundraiser?
- How do I know this isn’t a scam?
- Can I believe the results they’re reporting?
Even in an era of doubt, you can still build trust with your donors if you address what they want to know. Start by answering the following questions:
1. Does your nonprofit use pressure tactics? If your fundraising efforts are becoming high-pressure sales pitches with a pushy approach, you may be harming your reputation, as well as your donor relationships. No well-managed, respected charity uses such tactics to solicit donations.
2. Does your charity direct at least 75% of its budget toward programs and services? There is still a public misperception about the value of a low overhead ratio. Until it is better understood, it’s best that you provide clear narrative about the reasons why your organization spends less than three-quarters of the budget on the cause you exist to serve. Donors have many choices in determining where to direct their dollars; many individuals want to give to organizations that fulfill their mission above all else, so it’s important to make your case clearly and in a relatable way.
3. Does your charity have a commitment to reporting results? Your organization should readily report the number of people served, services rendered, volunteer time given and other basic information. Also, be ready to reveal the data-gathering methodology and how results were validated. The details, quality and depth of your reporting are important in building trust with donors and the community.
4. Does your charity report its medium- and long-term outcomes? Are you demonstrating measurable, long-term change, and not just immediate, short-term fixes?
5. Is your organization committed to accountability and transparency? Be sure bios of your board of directors and key personnel are available on your website and other communications. Keep donor lists and information secure and private. Implement clear and consistent policies regarding volunteer screening, staff salaries, the use of donor and/or client information, and other practices.
6. Do you receive independent audits? Ideally, your charity’s finances are reviewed by an independent auditor. Your finance or executive committee should also serve as an audit committee, overseeing financial reporting.
7. Do you treat donors like ATMs? Earn donors’ trust by respecting them as people who give for specific reasons – not simply as money machines. Learn their values, preferences and dislikes.
8. Does your charity convey a compelling message? Crafting a consistent and persuasive message is vital to creating a sense of trust. Appeal to donors’ emotions, but do so in an honest and authentic way. Tell your story and back it up with facts.
Donors may come and go, but loyal supporters are priceless. Although building these relationships takes time, they bring a greater return – donors who trust in your organization will tell others about your work.
Dean Vella writes about business and nonprofit leadership on behalf of University Alliance, a facilitator of transformational leadership and leading nonprofit boards courses. You may reach him at firstname.lastname@example.org.