These charities give 99 percent of the money they raise to their cause
This title ran across my news feed this week. I’m not sure why it popped up now because it was an article written in 2017. But, as an advocate for the valuable nonprofits serving our communities, it is frustrating to see this wrong thinking continue to be perpetuated — the idea that administrative and fundraising expenses do not go toward an organization’s cause. Because this message is one that makes the rounds every year as it gets closer to the holiday season, it is my hope that a little preventative action can help to better inform around this hot button issue.
The writer states that the purpose of the article is “to figure out which highly rated charities give the most money to the actual programs they’re supporting, versus administrative or fundraising efforts.” It goes on to say that they “teamed up” with Charity Navigator to find this out and then pose the question “How much of my money is going to the actual cause versus to things like administrative or fundraising costs?”
When the Executive Director or Development Director works to obtain sponsorships for their programs, it is so they can be made more affordable and accessible to the people they serve. It is called fundraising. It is also for the organization’s cause. When the Executive Director meets with local business leaders to share what the organization does and to seek their support, that is relationship building, the key to the sustainability of any nonprofit. It is also labeled as administrative and fundraising expenses.
It is very sad to see that, year after year, news outlets across the country continue to promote this wrong thinking. It is even more disappointing that Charity Navigator, and other similar organizations, let this wrong thinking go unchecked by not better informing their stakeholders, by sharing this article on their site as if it is something to be proud of, and by presenting their information in a way that it can be so grossly misinterpreted.
The thinking that none of this work goes toward a nonprofit’s cause is shortsighted. It also often comes from the very same people who declare that nonprofits need to act more like businesses. Nonprofits ARE businesses. The difference is that at the end of the year, the money earned is not divided among a small group of people. It is put back into programs for the next year. If there is a shortfall, due to fewer contributions (and thanks to wrong thinking such as this article presents), nonprofits do not have the luxury of raising their prices. Instead, they have to cut much needed programs or cut needed staff to run those programs.
(Please note that my concern with this wrong thinking refers to appropriate administrative and fundraising expenses, those incurred by grassroots organizations that work hard to help others. It is not meant to excuse organizations with excessive administrative expenses that have skewed the viewpoint of just how valuable, and often underpaid, the nonprofit sector is in our communities.)
The Executive Director, an administrative expense, is as important to the nonprofit as the Program staff and their expense. They are all on the same team, and all work together to fulfill their mission and to improve the health and well-being of our communities. There is no place for demeaning or devaluing the importance of each and every piece that goes into making that happen.
May I suggest that the real question we should be asking is “if nonprofits were not doing this important work, who would be?”
“These charities give 99 percent of the money they raise to their cause.” (2017, Nov 28). New York Post. Retrieved from https://nypost.com/2017/11/28/these-charities-give-99-percent-of-the-money-they-raise-to-their-cause/.
To learn more about the valuable nonprofits serving our communities, access the Inaugural Report on the State of the Nonprofit Sector on the Peninsula.