Growing individual giving

Growing individual giving Authors: Alice Teodorescu Ioana Traistă

Growing individual giving Learning from experiences in Serbia, Czech Republic and Romania

Authors: Alice Teodorescu Ioana Traistă

With the support of:

November 2016

Table of contents

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I. Introduction 5

The main motivation for this research was to listen to what donors want in order to better understand them and how they see the impact they are making.

II. Methodology 7 III. Local context 9 IV. Findings 14 1. Donor communication and involvement

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2. Donor impact 24

V. Recommendations 29 VI. Conclusion 31

Introduction

We believe that donors want to be part of the solution, and wish to contribute more than with their money only, but we seldom ask them what they think and want. We communicate to donors what we, as organizations, think is the greatest impact of their contribution. Hence, we are missing a significant opportunity to communicate messages that are meaningful for them.

This research tested the Most Significant Change methodology to determine the impact for individual donors in order to enhance giving. We analyzed what are the most significant changes that 24 individual donors have perceived since they started donating for PACT Foundation (in Romania), Trag Foundation (in Serbia), and Via Foundation (in Czech Republic). Also, we looked at how donors want to receive information from the organization they support, and what type of information they are seeking for.

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One of the Via donors mentioned that giving is one of the fundamental ways to relate to the other. Giving is sharing; it is like eating, like breathing. It is the essence of being together with other people. I think that how well we give and how well we receive is how well we can relate to other people, share our lives with them, be friends with them.

It is our duty and responsibility as organizations to support the donor to feel part of this community of giving.

II.

Methodology

In analyzing the most significant changes that individual donors have perceived since they started donating for a cause, we used the Most Significant Change (MSC) method. The MSC is a participatory monitoring and evaluation method mainly providing data on impact and outcomes.

There are three basic steps in using the MSC methodology: • Deciding the types of stories wanted and collecting them through interviews; • Selecting the most significant ones in a panel constructed from various actors (direct beneficiaries of an NGO, different stakeholders etc.); • Sharing the stories and lessons learnt with different stakeholders and other people involved in the process.

Rick Davies1 created the MSC technique with the purpose to meet some of the challenges in monitoring and evaluating a rural development program in Bangladesh.

In PACT Foundation, we ran two pilot projects that used the MSC as a monitoring and evaluation tool for community development, mainly targeting the organization’s beneficiaries.

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http://mande.co.uk/

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As it looks at impact, and involves different stakeholders, we decided to pilot it in working with donors as well.

The purpose was to see how donors perceive the impact they have through the donations they make and to learn from their insights in order to improve donor communication.

In this research, the process involved collecting stories of most significant changes perceived by donors and then selecting the most significant story for each of the organizations. In each country, we collected 7 to 10 stories of change, amounting to 24 donor stories in total.

Afterward, we organized one selection meeting per organization, with staff and board members. Based on the stories collected, we discussed donor perspectives, and lessons learnt. Also, they selected the most significant story for them. At the end of the interviews and selection meetings, we sent each organization a list of concrete recommendations resulting from the stories and from the selection process.

III.

Local context

Democracy in Central and Eastern Europe is still young.

The fall of the Communism in 1989 was the beginning of it, but it still has a long way to go in its development.

As the US Ambassador in the Czech Republic mentioned in a talk at the VIA Bona ceremony in October 2016: “democracy and elections are not the same thing. We usually forget that democracy comes from people coming together, asking for their rights and acting together for their community, for their country.“ After years of distrust and passivity during the communist time, promoting the mentality that each of us is responsible for the community we live in takes time, patience, and resources.

The main challenges that organizations face in Central and Eastern Europe2 are: • The belief that the government should be the only one or at least the main actor who takes action and produces change.

• Lack of trust. “People are frequently suspicious of the motives of people who want to help. […] The 2 Mayer, Steven E. in Community philanthropy in Central Eastern Europe http://www.issuelab.org/resources/8787/8787.pdf

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empowerment of people to care and get involved is the essence of community philanthropy.“ The rather confused perspective on “volunteering“, as a legacy of the communist times, for being an imposed tool of the Communist Party to work for the same goals.

The civic sector is still young, and local NGO leaders need to start from the beginning, without counting or building on past experiences.

Western models, where philanthropy has a rich history, do not work as such in the Central and Eastern Europe; they cannot be ‘imported’ as given recipes, and need adjusting and time to be assimilated.

The lack of a sound legal framework to encourage giving.

Using simple, clear-cut communication to allow the different publics to understand what NGOs do.

The growth of an organization is slow. It takes resources to do that, and finding people and institutions that are willing and able to give is not easy.

Also, as Vera Dakova3, Program Officer from the Charles Stewart Mott Foundation points out in “Philanthropic infrastructure in Central and Eastern Europe”, one must take into account the scarcity of resources and the local context as well, while building a philanthropic infrastructure in the region.

In this context, the work of organizations like PACT 3 In the article „Philanthropic infrastructure in Central and Eastern Europe - A true champion for the field” - http://fundatiacomunitarasibiu.ro/wp-content/ uploads/2014/01/Pages-from-EFFECT_Winter_2013_Web.pdf

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Foundation (in Romania), Trag Foundation (in Serbia) and Via Foundation (in Czech Republic) builds sustainable local communities with citizens ready to act for the betterment of their community and country.

PACT Foundation’s (www.fundatiapact.ro) vision is that every community has the courage, confidence and capacity to assume an active role in building its own future. Since 2006, PACT has been accelerating positive changes in small communities (villages and small towns) in Southern Romania, because they strongly believe that a country will grow most healthily bottom-up, through leaders and ideas within local communities. They offer community facilitation, training, consultancy and small non-repayable funding to support and encourage resilient people to develop relevant projects in their communities, to build a better life for their members. Whether it is about digging a well to gain access to drinkable water, or building a children’s playground or start-up a social/ community business, or establish a youth club, each community group chooses the change that it wishes to see in the community and creates it.

Trag Foundation (www.tragfondacija.org) has a vision of Serbia as a just and open society, whose citizens actively and responsibly take initiative in order to improve their communities. Such a society is based on principles of respecting human rights, tolerance and solidarity. Trag contributes to building active and open local communities by providing assistance to joint initiatives of citizens in these communities. They do this by providing financial support, promoting philanthropy and providing other types of support needed.

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Trag is a pioneer in the development of local philanthropy in Serbia. It is one of the few independent domestic, non-profit foundations, and the only foundation with a focus on local communities and initiatives in Serbia.

Via Foundation’s (www.viafoundation.org) vision is a society in which people act freely and courageously, accept responsibility for themselves and their community, and where giving is a regular part of life. They support citizens to engage in community development and spread the art of giving in the Czech Republic.

By providing grants and consultations, they support groups of people working together to transform and revitalize public spaces, restore neglected small monuments or organize neighborhood gatherings – shaping community life and doing all that is needed in their communities to bring people together and build trust.

rights and needs, as well as on their responsibilities, as citizens.

In the donors’ own words it is about awareness that things are possible, even in the small, remote communities in the middle of nowhere, people believe they can do things in communities where nobody went to do anything. (a Trag donor). Also, one needs to keep in mind that a healthy community has to develop passed basic needs. This is the first step. Then there is a rhythm in the community, and you build trust. And this is a huge resource on the same level with regaining hope. (a PACT donor)

Also, Via seeks to make giving an everyday issue for everyone by recognizing individuals and corporations for innovative giving initiatives, publishing a quarterly journal on philanthropy and giving children and youth opportunities to discover philanthropy.

All these three organizations contribute to building trust, empowering local citizens, and giving them the instruments to produce the change that they want to see in their community and country. They all contribute to shifting the belief that change has to come only from external sources (e.g. government). Also, they help change the power dynamics in these communities by supporting citizens to make their voice heard and act upon their

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It is also a matter of making the organization’s perspective on the donor and the donor’s perspective on himself come to constant dialogue and a common vision.

1. Donor communication and involvement

IV.

Findings

Donor relations are essential in building a culture of philanthropy inside and outside an organization. Cultivating (and even more so, steering) relationships takes patience, time, and constant feedback in order to make sure that we build trust between the two parties and that we hear each other when it comes to our needs and preferences. As Reinier Spruit mentions4, the best donor relations are based on authenticity and reciprocity. […] we have to start asking the right questions. To be more precise: we need to question everything we do.”

PACT Foundation, Trag Foundation, and Via Foundation’s donors mentioned a series of elements that are important for them in building a relation of trust and meaning with the causes they are supporting. Donors believe that each organization they support has the right tools to help them build the type of community they want to live in, where people will be more compassionate and also more active themselves. They are not going to wait for (local) government to do things for them. They will have their own initiatives and philanthropists will also support these initiatives (a Via donor).

4 In the article A donor relation is not a trick http://101fundraising.org/2016/10/relationship-not-trick/

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1.1. Personal relationship One of the first elements that donors mentioned is the personal relationship with the staff of the organizations or other people close to the organizations, who recommended them. For me, the trust I have in the people in the organization is very important (a PACT donor). 23 out of 24 donors interviewed met PACT, Trag, or Via because they knew a staff member or a person that had been in contact with the organization for a long time. It was easier for them to get involved having a personal connection within or close to the organizations.

Trust lays at the basis of every relationship, and donor relations are not an exception. As long as organizations manage to build trust, they will be able to build a community of long-term donors, as one Trag donor mentions: I know those people, I don’t know every detail about their work, but I know that they are hard-working people. That they like what they do, they are very determined. I know that when they start to do something they will finish it. They are honest people and that was the main reason why I wanted to give money to them.

I know some of them and I know they are honest, they work hard and I just believed in the program that they had, even if I did not investigate every detail of it.

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In the end, as one Via donor explains, trust is essential in choosing who to actually support: It took a long time to start supporting somebody. I was not always sure whether the money I provide will be used for the thing I want to support.

through their grantees, for example for reconstruction, so people could return to their homes. I collected an amount of around 400-500 euro. […] The one thing that I can do from my position now is to continue supporting TRAG by donations.

1.2. Time and expertise, besides financial contribution

1.3. Storytelling and clear-cut communication

Being given the right context and structure to offer their expertise and time, besides a financial contribution is important for many donors. A PACT donor mentioned that the most significant change for her was to have an organized system where she knows she can invest time, expertise, and money whenever she wants. I define this system as an organized framework where you are constantly encouraged to experience something else: a direct debit donation, offering feedback on different materials, visiting a community. It is not about donating money all the time. It is about raising funds, but all the time you are asked in a different way. It’s like a good deed incubator. For donors that already have a long-lasting relationship with an organization, it is not enough just to thank them for their donations and to send them regularly communication about campaigns and other activities. They want to be involved at a deeper level, to feel they are a part of the community, and treated as social investors. Thus, donors look at a wider impact, and not only at the organization that they support. Three Trag donors specifically mentioned they were involved in and would like to continue raising money for Trag: I organized a fundraising (birthday) party to collect funds for people in need after the huge floods in Serbia in 2014.

Trag was collecting donations and distributing them

On a general level, as one Trag donor underlined, it is important for people to understand the roles of NGOs in empowering other people and building a philanthropic and civic infrastructure: And I think this is one of the main problems in communication between civil sector and ordinary citizens. They think NGOs don’t do anything. Which is not true, but they don’t understand and they do not know how to use what is done. And for that we need to change their attitude and behaviour to become active instead of passive recipients in asking answers from institutions, from people in charge, from the state. And also, I think if they make a little change as a schoolyard or something like that they become encouraged to go further.

Most donors mentioned the importance of storytelling and clear-cut communication regarding what the organizations are doing. This helps them better understand how the money is used, the nature of the projects being done, what the impact of their donation is, and also to encourage other people to join the organization’s efforts. By marketing I don’t mean to be everywhere and make big advertising, but to communicate the programs and the focus very simply. (a Via donor)

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Storytelling and the good use of marketing tools can help these three organizations get their messages across, especially in their particular case - where the change in attitude and mentality within local communities is a long-lasting process. A Trag donor underlined: “in the last years, I think TRAG has been more out there among people in the sense of the language that it uses and the way it approaches donors. It is important not only because of the donations, but because when someone gives money it’s activating people to do something, they become active. It is a commitment. In a way, it is a change in behavior. Attracting more people to trust in what Trag does is that important.”

Storytelling can be used both in terms of describing the outcomes, and also the process that is needed to change mentalities from can’t do to can do. I believe the story is everything. It is very important how you tell the story, more important that what is behind it (a PACT donor).

Also, some of the PACT and Via donors mentioned that media coverage is important to raise awareness and build reputation. While, according to donors, PACT needs to work more on being present in the media, Via has improved their media visibility over the last years. ”The first change that comes to mind is about VIA Bona. They have this prize for people that support others. I think some years ago, media did not care about it and there was less coverage. Today, they have the Czech TV as partner, and the media space is more open to charity and philanthropy. This is a good change.”, says a Via donor. When it comes to PACT and its visibility, one of its donors said: “there are other NGOs that do far less, and they are more

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present and PACT is not. We need to be more present in the media, to be an authority when it comes to rural communities.”

1.4. Donor communication The ways in which the three organizations communicate with their donors hold similarities, but also complementary elements that can enrich each other’s work.

PACT donor communication is concentrated more on the local initiatives and the citizens that make them happen. Donors notice that they are regularly informed about the use of their donations, that they receive information from the communities, but they also feel they are not engaged enough. They want more direct contact with the people in the communities, and also with other donors and supporters. Also, they would want to be more up to date about what the organization is doing, so that they may identify ways to get more involved.

One of the donors mentioned that PACT could organize more face-to-face meetings where they can talk about the most recent initiatives, challenges and identify areas where they need help. Also, I want more stories from the communities, especially photos and videos or a simple account of what has been happening in that community.

On the one hand PACT donors want more opportunities to meet with communities and other donors. On the other hand, Trag donors are happy with the level of communication they receive, although sometimes it is not customized based on their needs. Most of them get their information from Trag’s website and Facebook

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page, and receive updates from time to time regarding the way in which their money was used.

One of the donors mentioned one instance when he was asked about changing the destination of his donation: It was nice to have someone ask me about “do you mind if we do this”; “is this what you intended the money for?”. That was really nice, to have that type of feedback.

Most of Trag’s interviewed donors, also, mentioned that they would like to receive annual reports, updates about the community work, and invitations to events, with a certain periodicity. This, however, would not influence their decision to donate, as they trust the organization and staff, but it would be nice to have. Another Trag donors underlined that ”it would be good to know exactly about the program, about what they did, how they spent the money. […] For me it would be OK to receive this kind of information at the end of a program, maybe after 6 months or 1 year, I don’t need to be informed too often.”

Also, most of the Trag donors interviewed believe that, being small donors, the impact they are bringing about is not big enough. I am happy with the level of communication we have. They do not communicate with me directly, maybe because in the last years I have not been a steady donor. We are not very big donors. Maybe they communicate directly with donors that are more active.

But I get informed because I follow their Facebook page and their webpage, one of Trag’s donors mentioned.

When it comes to Via Foundation, on the one hand, major donor communication is personalized and donors decide where their investment is to be directed and what the concrete results are to be achieved. They are also

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invited to visit the initiatives they are supporting, besides receiving updates and reports related to their donations: ”they send us the list of projects that are supported in the areas we are interested in; they gave us some more substantial information about some individual projects that they thought might be interesting for us and recently they invited us to visit those local initiatives.”

Most of Via’s small donors, on the other hand, feel they are not engaged enough. They know that Via’s strategy is to work with major donors, and some of them question the impact of their donation, and also think they are not being asked too often to contribute. “I feel like no one is trying to motivate me to donate again. I feel like small donors are not the main focus, so it could be that as well. I am reading their newsletter carefully. I really read the articles about the things going on. But I don’t really care to see changes in their work; I know they’re doing well. The donation for VIA was small; if the donation was bigger, I would be more interested in how I invested my money maybe.”

Still, one donor mentioned an evolution in terms of communication which underlined Via’s attention to donors’ relations and the donor’s need to know where the money goes in terms of projects: “In the beginning, the communication was not ideal. In the sense that we donated money, and we were not sure how they were used. And this has improved much.“ Another important aspect mentioned by PACT and Trag donors is that they also want to find out about projects that did not work, not only about success stories.

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Relationships are more solid when they are built with honesty on vulnerabilities as well. By sharing the challenges, organizations can bring donors closer to their story, can engage them and make them part of the solution. One of the donors recommended to talk about the projects that did not succeed and to find together what the reasons for that were. Sometimes our expectations are not met despite our best intentions. I think these lessons learnt would be useful also for the people in the communities. They should know that it wouldn’t be easy, but also that they are not alone, and they have the example of other communities (a PACT donor).

1.5. Relation to the mission and vision All donors stated that they deeply relate to the organizations’ mission and vision. They believe that supporting citizens to build and improve their local communities is a sustainable way to change their country.

Nonetheless, PACT donors talk more about the local communities and less about PACT as a means to support the changes in these communities. Trag and Via donors are more likely to talk about the organizations’ good work, their role in the society, and less about specific initiatives at the local level. All of them are aware of the importance of bottom-up changes, but while Trag and Via donors have a more balcony approach, PACT donors are more focused on local initiatives. This could be due to PACT communicating mainly on the outcomes, rather than on the work in progress, that is the process itself of developing communities. Another reason might be also

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because PACT has been working mainly at the grassroots level, compared to Trag and Via that have built a reputation in supporting local initiatives, but also in promoting philanthropy on a wider scale. The lesson that we may draw from here, nevertheless, is that all three organizations need to combine communicating the outcomes of their work, and the process that leads to those, with its inherent challenges and successes.

The more people are involved with the organization, the better they understand the philosophy and values behind it, and the impact that it may have on a larger scale.

“Trag is a movement builder. Trag has a vision of how supporting local people, on the ground, how building a critical mass you can change your country. […] I also think Trag is a visionary and innovator because it is not working on an issue. It is able to look at the bigger picture and engage in creating the field in which NGOs and people can do things.”, a Trag donor said.

Also, a Via donor mentioned: “We have supported the Fast Grants program, their advocacy program. This is the program that supports the local initiatives. Generally, I am a big supporter of the civil society and I think that any grassroots initiative that improves local life is extremely important for the country.”

When it comes to PACT, as an urban-located organization working mainly in villages, the connection with rural areas is extremely important for many of their donors – who are also mostly urban residents. But they either have family or grew up in the countryside. They have a vision about communities in rural areas and they think

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PACT can help them achieve it. “Rural development is important for me because I grew up in a village and I know how things work or don’t work there. […] I want life in the countryside to be more sustainable and easier.

Villages should be more connected to each other, and also with potential consumers from cities. They would have better infrastructure, access to education, information and products flow, and know-how. The level [of wellbeing] would be higher, closer to what rural means in Europe. We could catch up, but we need a lot of work and dedicated people.“, one PACT donor said.

The donors, also, have a vision of their own, which usually relates to the sustainability of the organization and the kind of work they support: It seems that things are happening spontaneously more than they should. In order to be sustainable and financially viable to some extent, it is important to reflect where you are and where you want to be and how to get there. Finding a balance because the situation is uncertain: finding funds, any kind of funds and be true to yourself and where you want to be. (a Trag donor)

2. Donor impact The most significant changes that the interviewed donors have noticed in the work of the organizations that they support, since they started donating, are quite diverse.

Three out of nine PACT donors have not noticed any change. The other six mentioned:

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• Better communication in general, and in this way the donor is more up to date with what PACT does, and what happens in the communities.

• People in the communities seem more determined and full of energy.

• PACT offers the donor a framework with different ways of getting involved.

• The donor understands better the people in the local communities and she can empathize more with them.

• [n.r. There seems to be] More hope for people in the communities [due to PACT’s work there, n.r.].

• People in the communities have changed their attitude from can’t do to can do.

For Trag, two donors out of 7 have noticed concrete changes, as follows: • The awareness that TRAG brings into local communities, that things are possible.

• Changes in how Trag addresses their donors and how the organization nurtures them. It is not only about getting their first donation, but it is about them becoming supporters, and building constituency.

All Via donors mentioned changes since they started supporting Via: • The impact they had on generosity and philanthropic giving, this is the most significant for me.

• The most significant change is in myself. I pay more attention where I donate.

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• The most significant change is the focus they have.

It is clearer now. Each donor has a motivation for donating, and finding an organization that fits with it is important.

• The philanthropy programs for youth that Via has developed, because they are teaching young people that they can also contribute, as long as they want to do so.

• The communication that Via has with us has improved. We have mentioned that we want to be better informed and we now get pretty substantial information, we are being invited also to come and see what has been achieved with our money. This is something that has changed.

• The most significant change is the optimism in people. It’s not usual nowadays that people are optimistic and have new ideas, but I can see it in the people from VIA and people in need.

We can, thus, divide the changes that all donors have mentioned into three main groups: • Changes at community level (both local communities, but also nationwide); • Personal changes in the life of the donor; • Changes in the way that the organization structures and communicates its work.

Most of the changes that PACT donors have noticed are linked to the communities that PACT serves (4 out of 6). Two of PACT donors mentioned changes in the organization, as to how it communicates the results of its work and their engagement, and as to how it involves

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them as donors. The challenge for PACT will be to find balance between communicating about local initiatives and concrete steps that it is taking to support these local initiatives. Thus, donors will understand the process of building communities, not only the results.

Trag donors have pointed out the two main directions of the organization: the trust they build at community level and promoting philanthropy on a wider, national scale.

The donors that mentioned these changes are involved long-term with the organization, and not only financially. In the future, Trag will need to nurture donors and get them engaged in different ways, so that they can experience the impact they may all have together.

Via donors have identified all 3 types of changes. They mentioned how Via has improved its communication and has focused and diversified its programs, the impact it has achieved at community level, and also the impact that it has made on the donors themselves. If decided to be a strategic direction, the challenge for Via will be to personalize the work they do with small donors, for a change, in order to help them see the impact of their contribution.

The levels of impact that the donors have perceived provide a sound and complex perspective on their roles and how they might be better induced in the mission and vision of the organization, as actors of change and endorsers of both specific causes, and philanthropic infrastructure building. The motivation for giving is always personal, but it can be understood in relation to the cause, the organization and/or the donor’s life per se.

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There was a lot of focus on healthy communities and grassroots involvement that makes a civil society function in a proper way. The stories of change analyzed in this research pinpoint to a new need that is being built, the need to give back, to live in an overall healthy and functional society.

V.

Recommendations

Building trust is a complex process, especially when working with individual donors who have different needs and expectations. Nonetheless, based on the discussions with donors and the selection meetings, we have put together a list of recommendations that will help organizations strengthen donor relations and communication.

Yet, the list is not exhaustive.

• We need to listen constantly to what donors might be telling us they want and need, and ask for feedback on how they see the donor-organization relationship.

• Organizations should be able to have a vision for their donors in terms of what they know, feel, and how they act. In that way, organizations will be able to better guide donors in their giving journey, by better defining the donors’ relationships and stewardship.

• As organizations, we need to define what we want our donors to know, feel and act, in order to be able to guide them in their giving journey.

• Personal relations with staff members and/or other people close to the organization are important for donors. Make sure that donors get to know more people in the organization, and not only the ones doing the fundraising.

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• Donors may not want to be exclusively financially involved. They may want to contribute their time and expertise as well. Even if they may not be explicit in this sense, always look between the lines and encourage them. If there are projects where donors can be involved, do not hesitate to ask them! Think about them as long-term supporters and partners; this may be how they wish to see themselves.

• Define cultivation and stewardship plans for the different categories of donors: what are your categories; how you thank them; what to send them; how often. Ask them what they want to receive and on what frequency to send them information.

• If you want them to have a better understanding of local initiatives, organize field visits and/or facilitate the direct contact between donors and the initiatives they are supporting, as well as you may support live exchanges on such donor experiences, among your different donor types, supporting various causes. It will inspire them!

• Build a solid and stainless reputation. It is important for donors to support an organization that holds (professional) probity, and one that is a leader in its field.

• Use storytelling and be more present in the media. It helps build awareness and break down what the organization is doing in simple, clear-cut communication.

• Offer a variety of means for donor giving and involvement, which are user-friendly and safe. I.e.

Donors like tools that facilitate easy giving such as online donations.

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VI.

Conclusion

The Most Significant Change method applied to donors turned out to be a lively, insightful and useful means for carrying in-depth conversations with donors, in view of understanding their views on the impact of their giving, all the while highlighting their motivations and personal views on philanthropy, that can help the organizations further, on various levels.

Donors want to give back to society. The specific activity that leads donors to have trust is engagement through people. Engagement and trust provides the conduit for people to give back.

Organizations themselves, not only the cause they work for, are important for donors. They look at how organizations innovate, communicate, and focus their programs.

For the organizations having taken part in this research, a constant challenge in order to build and sustain trust consists in creating a shared vision between their teams and methodologies, and their donors, who need to be involved as partners in the long term.

Most of the interviewed donors were supporting multiple causes and some were regular donors for various organizations. The MSC has also proven successful in pinpointing the importance of giving and what is important for donors when choosing the cause/causes they are willing to support.

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