by Dawn M.S. Miller, CFRE
It’s Wisdom Wednesday … so let’s discuss the “wisdom” of fundraising policies and procedures. Did I just hear a collective groan ripple across the internet?
Stick with me! Yes, I know the topic may not seem overly exciting. However, policies and procedures are very much needed when we, as fundraising professionals, are entrusted with our benefactors’ gifts.
- We must protect the mission, integrity, ethical values and governance of our nonprofits.
- We are holding the public’s trust and confidence through our actions. Donors insist on accountability and transparency. They want to know specifically where their hard earned money is going and how they are helping the greater community through your nonprofit.
- We can improve our staff’s effectiveness and efficiency with proper use, training and follow-through of policies and procedures.
- We have the right to say “no” to a potential gift from a donor, with policies and procedures to back up our decisions (more on this topic next week!).
One of the most important policies for any nonprofit is often referred to as the Gift Acceptance Policy.
The purpose of a Gift Acceptance Policy is to provide gift opportunities to donors who want to support the mission of a nonprofit. The policy is designed to assure that all gifts to, or for the use of, the organization are structured to provide maximum benefits to both parties. The goal is to encourage funding of the organization without encumbering the nonprofit with gifts which may prove to generate more cost than benefit, or which are restricted in a manner that is not in keeping with the organization’s mission.
This written document is established to:
- Ensure that informed decisions are made on the acceptance of gifts and that such gifts are receipted in accordance with the requirements of the Income Tax Act
- Ensure that efficient administrative, legal and accounting practices and procedures are followed
- Enable accurate reporting of gifts bestowed upon the organization, services and programs
- Ensure consistent, equitable relations with all donors.
Some of the key components of a Gift Acceptance Policy may include:
- Solicitation of gifts
- Role of the Board and/or Development Advisory Council, as applicable
- Donor confidentiality
- Payment of fees for services
- Acknowledgement and stewardship of gifts
- Donor recognition and recognition of discounts/services
- How conflicts of interest will be handled
- Refunding and/or declining gifts
- Accepting cash gifts; pledges and recording of pledges; securities; equipment and personal property and real estate
- Deferred/planned giving programs (wills and bequests, charitable gift annuities, life insurance, remainder trusts, etc.)
- Statement specifying who has the authority to enter into agreements on behalf of the nonprofit
- Timeframe for regularly reviewing the policy (i.e., annually, bi-annually, etc.)
- Contact information for donor questions
Whoa! Does that seem like a lot of information? It sure is.
Look for Part Two of “Can We Accept that Gift from a Donor?” next Wednesday for more tips — and a few stories, too. Enjoy your Memorial Day Weekend!
Dawn M.S. Miller, CFRE, is Director of Consulting for Fund Development Services at Zielinski Companies in St. Louis, Missouri. She can be reached at firstname.lastname@example.org or (800) 489-2150.
Founded in 1957, Zielinski Companies helps nonprofit and religious organizations address their financial, management and planning needs. The firm has a broad range of consulting service areas, including: Fund Development and Mission Advancement Consulting; Audit, Accounting and Tax Services; Property and Facility Planning; Organizational Management and Planning; Long-term Care, Facility and Staffing Consulting and Cash Management and Credit Card Services. For more information, please visit www.zielinskico.com.