Donor Revolts, Donor Agreements, and Setting Boundaries

From donorrevolt.com

The Chronicle of Philanthropy has some good advice about donor relations in an era of donor anger and activism. The proactive measures discussed in the article make good sense.  Here are the introductory paragraphs: 

When wealthy donors started withholding gifts to colleges because of the way they handled responses to the Israel-Hamas war, many nonprofit chief executives and development leaders nationwide realized they needed to prepare their own institutions for a new era in relations with benefactors. Not only is the war galvanizing donors, but so too is political polarization, which is especially high in an election year like this one.

“Many charities, not just large Ivy League universities, are concerned about this,” says Doug White, a former fundraiser who is now a philanthropy consultant and author of Abusing Donor Intent: The Robertson Family’s Epic Lawsuit Against Princeton University.  The ripple effects of anger over how some colleges and other nonprofits have responded to the Israel-Hamas war, debates over diversity, and other issues go beyond the richest donors, experts say.

Some donors are “embarrassed” by the behavior of organizations they’ve previously supported, says Avi Kestenbaum, a lawyer who represents many charitable donors. People who feel let down by a charity they trusted are going to be “a lot more careful about where and how they spend their money.”  While donors who give the largest sums typically negotiate gift agreements with charities they support and have a chance to work out conditions for substantial donations, most donors don’t have that opportunity, he says. He believes many of those donors may choose to give smaller chunks annually, with the option of stopping if they feel the institution veers in the wrong direction. Another possibility: Some may opt to create trusts that dole out the money on a regular basis — provided the charity follows the principles set in the trust.

As donor revolts become a more pressing issue for nonprofits, the Chronicle asked veteran fundraisers, foundation officials and philanthropic advisers how organizations should prepare for what’s next.

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darryll k. jones