Charity Case: Vancouver philanthropy
Three local organizations, struggling through an economic downturn, offer words of wisdom from the philanthropy trenches.
WHEN THE ECONOMY is slammed by recession, individuals, businesses and governments all start considering (and reconsidering) every single spending decision they make. For B.C.’s charitable organizations, the challenges are daunting. Companies are shrinking and individuals are being laid off, and yet they still have to be approached and asked for selfless contributions. A charity’s very survival depends on it. At the same time, charitable organizations are watching their investment incomes plummet alongside everyone else’s.
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Hard numbers on exactly how the current economic climate is affecting B.C.’s charities won’t be available for many months, but reports from individual organizations reveal some interesting stories. While charities everywhere agree the recession is a threat to operations and have begun cutting expenses wherever they can, some report that revenues have remained more or less on track while others say they’re falling behind.
This is partly a reflection of the diverse nature of the charitable world: some charities depend predominantly on grassroots support from many thousands of small donors, while others rely on a few well-placed cheques from local millionaires – many of whom have seen a dramatic drop in their net worth thanks to plunging real estate and stock markets.
In this package, we take a look at three local charities – a community organization, an institutional foundation and an arts group – and find out how they’re surviving this economic crisis. Each has its own strategy to make it through with operations intact, and each tells us a little something different about ourselves, the givers – about what we are, and are not, doing to help.
The Community Organization
UNITED WAY OF THE LOWER MAINLAND
2008 Revenues: $38.2 million
35% Donations from individuals
(more than $1,000 per year)
27% Donations from individuals
(less than $1,000 per year)
25% Corporate donations
7% Contributions from foundations
6% Fundraising events
THE CRUEL TRUTH of funding social services via philanthropy is that the money disappears when you need it most. Recessions have that twin effect: they hurt the most vulnerable in society as they hammer the bank accounts of those who would otherwise help.
The United Way of the Lower Mainland didn’t meet its fundraising target this year, says CEO Michael McKnight, falling 11 per cent shy of its $32.9-million goal and coming in $3.4 million under last year’s total. Nearly 80 per cent of the United Way’s funding comes from its workplace fundraising campaigns, which it runs in about 1,200 B.C. companies starting in September each year. The shortfall in donations was most noticeable from givers in the resources, finance and construction sectors – not surprising given what’s going on in the economy. And yet the calls come in from neighbourhood houses, mental health centres, job training services and other front-line social support groups, McKnight says, now more than ever.
The United Way will meet its existing commitments this year by dipping into a contingency fund, which is large enough to sustain current operations this year and possibly into part of next year. But if fundraising doesn’t improve beyond that, the organization will be forced to make tough decisions about cuts to existing programs. In the meantime, plans to expand certain promising projects are being put off, McKnight says, including a program designed to help at-risk kids avoid potentially damaging life choices, such as getting involved with drugs and gangs.
While this year’s funding crunch is an unforgiving dilemma, it ultimately pales in comparison to the United Way’s long-term challenge: how to stay relevant with donors in a changing society. The United Way’s workplace fundraising campaign, for instance, is geared toward large organizations, and B.C.’s business landscape is increasingly populated by small- and medium-sized companies and increasingly devoid of major head offices. This presents a major organizing challenge for the United Way: it can take dozens of workplace campaigns in small offices to raise the funds the charity could get from just a handful of events at two or three major headquarters.
Demographics are another pressing issue, according to McKnight. Today the United Way’s typical donor is aged 35 to 50 and likely already has connections to some kind of social service. But the organization needs to reach donors now in their 20s, McKnight insists – donors who don’t necessarily respond to the same bake sales and neighbourhood drives as their parents. Younger people are generous, he says, but they’re not as interested in decades-spanning commitments, which organizations such as the United Way have relied on for so long; they’re much more interested in a quick online credit-card gift. The United Way designed its Community in Crisis website to deliver exactly these capabilities.
The site – launched in March – is clearly focused on quick and easy giving, sporting a big central button labelled “Give 10 bucks.” While the site had logged a relatively modest 632 donations as of press time, McKnight says, “What it will do is help us build some knowledge and expertise as a charitable organization in how to access particularly younger donors, who we don’t necessarily have a historic relationship with.”
The United Way has been active in the Lower Mainland for 75 years, McKnight says, and is steeped in tradition. But it can’t afford to be static as the community changes. While these social shifts might not start affecting the bottom line for another five or 10 years, now is the time to start working on new strategies. By the next recession, it might be too late.
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