Time for a Campaign to Fight (Erroneous) Myths about Nonprofits

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July 19, 2011; Source: Third Sector | Stephen Cook, the editor of Third Sector, an attentive and apparently well read publication on nonprofits in the U.K., noticed recently that the British public believes that it costs charities an average of 42p (pence) to raise £1. The poll revealed that the public thinks that an acceptable fundraising number would be more like 24p. According to the Charities Aid Foundation, which published the poll, the actual fundraising cost for charities is on average 12p. Is 12p correct?

As a self-reported figure by charities, like fundraising costs reported in the U.S. on nonprofits’ 990s, it’s probably off.  But Cook notes, “The fact remains that there is a massive mismatch between public perception of fundraising costs and the reality – a mismatch that might well deter some from donating.”  He says that the facts to counter the public’s misunderstandings of the sector exist, but they’re basically circulated within what he calls the “specialist press,” meaning nonprofit journals like NPQ in this country, that are typically read by people within the nonprofit community.

That obviously doesn’t do the trick. “In your dreams, you might see a big advert by CAF or the Institute of Fundraising on the London Underground or in the Daily Telegraph, blazoning these latest figures,” Cook says. “But in real life, they are more likely to languish in the archives, feeding the sector’s well-nursed grievance about charities being misunderstood, but being used for no wider practical purpose.”

But aren’t these advertisements a nice idea? How about “Did You Know” subway and bus advertisements with facts about the nonprofit sector, meant to counter the everyday misunderstandings that we all know people have about nonprofits in this nation – because we hear them articulated by Mom, Dad, Uncle Jack, and Aunt Lily. Nonprofit Quarterly produced a map of the nonprofit economy, which is meant to dispel myths about federal, state, and private charitable flows to the nonprofit sector, but that graphic doesn’t fit easily onto a New York subway advertisement.  So how about bus and subway ads on  facts big and small, like . . .

·         Do you know how many of your neighbors and friends work for nonprofit organizations?

·         Do you know how many nonprofit organizations and churches there are in the United States?

·         Do you know how much charitable giving to human service organizations has declined in the midst of a recession?

·         Do you know the proportion of affordable housing production every year that is constructed or rehabbed by nonprofit organizations?

The questions are innumerable and the facts are there, but it would be great if they were shared with the public in a way that isn’t self-aggrandizing for the nonprofit sector, but simply educational to improve the American public’s understanding of the facts behind the 501(c)(3) tax status. —Rick Cohen

  • Shelley Hamilton

    When we buy ZXY product/service part of what we pay covers the Sales & Marketing cost associated with “raising our awareness” of our need/desire for XYZ product. Funders too want information about social/environmental needs and the various solutions provided by nonprofits to address those needs just as consumers want information about products and services.

    You don’t see people questioning the role that Sales & Marketing plays in the commercial market (well, OK you do on a grand conceptual level when it comes to questioning our overall consumerist society, but other than that . . .). Why is it any different in the nonprofit sector?

    In fact, it is quite resonable to expect the percentage allocation toward “Sales & Marketing”(i.e. fundraising) in the nonprofit sector to be higher than in the commercial sector because nonprofits have two different “clients” to communicate with – funders and the recipients of their services.

    As a sector we need to stop running away from full cost accounting. We need to stop burying the real cost of doing business (i.e. fundraising and general operating costs) in our “program” budgets so that everyone knows what it really costs to have a healthy, genuine civil society that educates its citizens, helps the less fortunate, and doesn’t degrade our planet.

  • JLaide

    There are nonprofit associations

  • Julie Dappen

    I agree about the need for strategic communications related to the nonprofit sector. The sector hasn’t told its story. For example, people don’t understand the role nonprofits play as providers on behalf of government; — they don’t realize government dollars are use more effectively because nonprofits are partnering with them to deliver needed services. The lack of understanding makes some people believe government is “supporting” nonprofits rather than understanding that nonprofits often partner with government to provide essential services and help the government fulfill its responsibilities.

  • Michael Wyland

    I’m fortunate in that I have been on the faculty of the “Leadership Sioux Falls” program of the local Chamber of Commerce. Each year, I get to speak to 30 emerging business leaders specifically about the nonprofit sector in our community, state, and nation.

    25% of local employment is in nonprofits. Over 20% of our state’s GDP is accounted for by nonprofits. There are over 1,000 nonprofits within 50 miles of the city, 20 with annual revenues over $20 million. My point to these business leaders is that nonprofits aren’t an adjunct to the economy and business cycle in our community – they *are* an integral part of that economy. These organizations and their employees are your customers as well as responsible for providing services that your employees and customers rely on for quality of life and productivity in the workplace.