The holiday spirit is in the air. This is the time of the year that many Delmarvans will begin thinking about making charitable contributions to those in need. But how do donors decide which charity is the best to fund?
A well-intentioned chain email began circulating in 2005, cautioning potential donors against giving to charities with high operating costs. Versions of the email have been re-circulated every year during the holiday season.
The email intends to inform donors and encourage them to choose the most efficiently operating charities. According to Forbes, this efficiency rating is calculated as "the percentage of private donations left after subtracting the cost of getting them." These costs include salaries and fundraising efforts.
Salaries for executives at well-known organizations such as the Red Cross, UNICEF, and the Salvation Army are listed in the email. The message was written with good intentions but much of its information, even including information about organizations placed in a good light, is now out of date and can mislead holiday givers.
Snopes.com, an online site that discusses urban legends, Internet rumors, email forwards and the like, has published an up-to-date article that responds to all of claims in the aforementioned email and encourages readers to gather facts from organizations that compile and publicize nonprofit information on a regular basis.
For example, the email slams the United Way, claiming its president received a large salary along with various luxury benefits while only 51 cents of each dollar of income supported the United Way's mission. However, just last week the United Way was named one of Forbes 2012 "5 All-Star Charities" for its outstanding work and fundraising efficiency.
Kathleen Momme, executive director at the United Way of the Lower Eastern Shore in Salisbury, said she is made aware of the email each year when donors who have been forwarded it call her organization with questions. She said that the email causes some donors to be extremely angry, with some even threatening never to donate again.
Momme said that fortunately the email has not resulted in a decrease in donations to the United Way of the Lower Eastern Shore, the area's largest provider of funding to local nonprofits.
"The lesson here is don't believe everything you hear," Momme said. "It's sad, all of the negativity that surrounds this, but good will always win."
Resources like Charity Navigator, Guide Star, Give Well, the Better Business Bureau and Forbes provide a wealth of information on charitable organizations. These sources encourage donors to take a proactive role by researching organizational efficiency. These organizations gather tax information from nonprofits and assign each an efficiency rating.
Sandra Miniutti, vice president of marketing and CFO at Charity Navigator in New York City, said that nonprofits receive approximately 40 percent of yearly charitable donations between Thanksgiving and Christmas. She said that mailboxes will be flooded with appeal letters and telemarketers will be calling on behalf of charities.
Miniutti advises donors to avoid the "knee jerk" reaction to give to the first organization that approaches them. Instead, she suggests donors take a proactive role and research the causes they want to support.
"Donors really need to take the time to find causes that are important to them," Miniutti told WBOC. "From there they should find a charity in line with that and stick with the charity over time."
Give Well has created an extensive list of questions, divided by the type of charity, for "do-it-yourself" evaluations. The questions are designed to help potential donors analyze an organization's effectiveness.
When choosing a charity to fund, donors are encouraged to examine organizations efficiency ratings from various sources.
Charity Navigator advises that donors also consider the following when searching for a reputable organization:
- Be proactive: identify which causes are most important;
- Start a conversation: contact the charity to find out about their impact and accomplishments;
- Concentrate your giving to one organization: greater funds may bring greater change
- Be careful of sound-alike names: similar sounding organizations can have very different missions;
- Make a long-term commitment: commit to becoming a partner to bring about change
Miniutti said that this proactive approach to giving will help donors avoid missteps by gaining a true understanding of the impact of an organization's programs and services.
