INFLUENCES ON THE NOT FOR PROFIT SECTOR
The recession was a wake up call.
Many nonprofits were left high and dry when their sole funding stream, gov’t line items, grants or contracts, began to disappear. Many scrambled to pressure the feds, others sought funding elsewhere. Some sadly closed up or, if they were lucky, merged with a similar organization.
Relying too heavily on one form of funding is a death knell. Diversifying funding is essential to nonprofit sustainability. In the recently released 2010 Nonprofit Fundraising study by the Foundation Center, organizations raising over $3MM annually did so because of their diversified funding streams. Over seven different funding vehicles were used by over 73% of those in the $3MM plus group. How many funding streams are you accessing right now? Corporate giving is an important part of those streams.
Another influence on nonprofits, peeking their interest and attention toward new corporate philanthropy, is the overwhelming BUZZ on corporate social responsibility, which has not been missed by these organizations. This is making them question their approach and strategy and reformulating to meet the new corporate perspectives. Additionally, many nonprofits are now finding themselves being denied funding from previous corporate partners, many of whom they relied on for significant help, because the companies in question are realigning their giving in a more unified and strategic fashion with their CSR model.
Finally, bad information being disseminated and lack of research on corporate giving among the nonprofit sector has a negative influence on our thinking and planning. Corporate giving is not about marketing. Neither is it influenced by an ‘obligation’ the company feels to society. And if we went off and approached our corporate partners with this in mind we would be dead in the water before we got to the closing statement.
It is an investment, not an obligation; a partnership, not a market approach. And it is directly tied to their business goals.
Up tomorrow: Defining Corporate Social Responsibility to understand process, policy and approach