The Pros and Cons of Anonymous Giving

anonymous giving

Tyler Morning Telegraph By Dawn Franks April 16, 2017

How anonymous is an anonymous gift? A good place to start is what it means to you. Is it not being known for specific actions or gifts you made? Is it being known by a few but not the many? Is it making a gift or doing something that is unremarkable or unnoticed? A yes means you’re right there with the dictionary definition.

Now let’s talk about what you mean when you say, “I want to make an anonymous gift.”

First, let me share a story with you. In my early years as president of the United Way, my goal was to raise money to fund 24 different agencies. One day a gentleman called and wanted to meet me. That wasn’t surprising since the job required connecting with all kinds of people in all kinds of companies to raise as much money as possible. The gentleman who came to see me explained he was with an organization that actively sought out places to give that had programs doing important work in the community, and had both strong executive and board leadership.

Topping it off, they did their work anonymously. In my previous 15 years as an executive director of a local organization, I had not come across this funder. To be fair, that’s because they hadn’t been around all that long. Still, I was surprised I hadn’t heard of them before.

We did have a program that caught their attention and received a grant. But here’s the kicker to the story.

I shared our news about the “anonymous funder” with nonprofit executives at a meeting. Smiles broke out around the room and heads nodded. Oh, yes, they had received grants from the same “anonymous funder.”

Before long we all knew the name of the anonymous funder. So, I ask you, was it really an anonymous grant?

There were no requirements to keeping the name anonymous tied to the grant. But when they came to see us there was always the reminder that they preferred not to be recognized.

Anonymous donors are alive and kicking at nonprofit organizations everywhere. They are individuals, families and foundations who prefer to avoid the limelight of recognition. Their reasons vary from discomfort with recognition generally to a preference to fund under the radar, reducing unsolicited asks from nonprofit organizations they haven’t historically funded. They prefer to pick their targets rather than be the target.

Sound fundraising practice for nonprofit organizations looks a lot like targeting. For some donors, the act of identifying nonprofit targets is equally important work. An anonymous gift is a tool in their tool box.

Here are four reasons to make your gift anonymous:

  • It allows you to identify organizations you want to focus on and make intentional decisions about your giving.
  • It allows you to give larger gifts to a specific organization and avoids the assumption that you always give at that level.
  • Most of the time you avoid being listed publicly as a donor.
  • It allows you to give and not explain.

There are also valid reasons for not giving anonymously:

  • You set an example by your giving, and others follow.
  • The more names an organization can list as donors publicly the more likely they are to grow their programs and services.
  • You receive friendly recognition from their board members and fellow donors who perceive you as caring about their cause.
  • You provide encouragement to board, staff and volunteers that the work they are committed to matters. I know the anonymous donor intends the same, but it may not feel the same to them.

Occasionally, a donor makes a gift to an organization and is identified as a major contributor on their annual IRS 990 filing. Specific rules and formulas dictate such instances, so if you are making a rather large gift to an organization and have an interest in remaining anonymous, it is worth checking it out with both your CPA and theirs.

You decide the level of recognition that’s right for you. Either way, your gift matters to the organization.

For those who prefer to be the “anonymous funder,” go forward and give well.

 

Dawn Franks, CEO of Your Philanthropy, offers advising services to families, businesses and foundations to enhance the giving experience and maximize impact. She writes a blog, the YP Journal, at www.your-philanthropy.com . Comments and questions are welcome. Send to info@your-philanthropy.com.

 

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