Increase donations and trust by improving transparency. It is absolutely essential that your community has trust in your mission and your integrity as a company. This trust is the driving force that convinces donors to give year after year. Here are some tips on how to enhance transparency and garner trust to improve and increase donations.
Financial Transparency
In order to hook donors and keep them engaged, it’s important to understand who they are. Donors are smart, empathetic, changemakers who actively engage with causes they are passionate about. They likely want to form a personal relationship with your company and your staff by doing some of the research themselves, rather than passively following your marketing campaign. Make this research easier by clearly posting key financial information.
Publish Tax Returns
If your nonprofit is a tax-exempt 501(c), you are required by law to have your tax returns available for viewing on your website. However, publishing them regardless of requirements is extremely beneficial. Making this information easily available promotes trust between your company and your donors. According to a survey conducted by the global research company YouGov, 50% of their survey participants were “put off when they didn’t know exactly how [their donation] was being spent.” By publishing your tax forms that detail your spending, you allow potential and repeat donors to see how your company allocates and spends donations.
Publish Annual Reports
Annual reports are another valuable form of data that can promote transparency and trust. For nonprofit-specific impact measurements, consider investing in logic models and key performance indicators. Logic models allow nonprofits to track their progress by visually illustrating the relationship between resources, programs, and intended outcomes. They are incredibly useful for planning and evaluating programs. Key performance indicators (KPIs) function similarly. They help nonprofits track their progress towards narrow goals such as volunteer engagement. Overall, these annual reports should include your company’s impact, finances, key staff members, board members, programs and activities over the last fiscal year, and photos of your company in action! You can include graphs or charts to help illustrate some of the more complicated financial information and data. Visual aids can also assist in breaking up the text into chunks that are easier to metabolize. Clearly providing this statistical information encourages trust between donors and your company, leading to an increase in donations.
Conduct an Independent Audit
Lastly, consider conducting an independent audit of your nonprofit. Independent audits examine your company’s business practices, accounting practices, financial records, and transactions to make sure that your company is complying with financial ethics and business standards. Performing an independent audit can be incredibly helpful to show donors that you are serious about making sure their donations are being allocated exactly how you said they would be. In addition, you can apply for a Seal of Transparency from Guidestar. Guidestar collects transparency data from nonprofit companies around the world and awards them medal-graded seals of approval depending on the company’s ability to prove transparency in pursuit of their goals and effectiveness. In this way, a platinum seal of Transparency Guidestar can go a long way in proving your company’s integrity to donors and increasing donations.
Operational Transparency
Donors want to understand the inner workings of your company. It is easy to appreciate events, programs, and fundraisers, but much harder to appreciate the mundane daily tasks that keep your company running. Helping donors understand the work that goes into upkeeping your nonprofit allows them to feel connected to your company and its mission. This enriches the bond between you and your donors and increases the amount of donations you will receive.
List Board Members and Staff
Donors want to know who is responsible for managing their donations. Increase operational transparency by publicly listing your nonprofit’s board members and other notable staff on your website. This allows donors to match faces to names and get to know the people behind your operation, further strengthening the relationship between your donors and your organization.
Share All Steps of Your Success
Donors love success stories. Who doesn’t like to see a cause they care about succeed? However, showing the steps to success can be just as valuable. Give donors a look into your company’s day-to-day operation. Share your mission, plans, and processes. This helps unveil the work behind your nonprofit’s success which showcases the dedication of your staff and encourages donors to become a part of the process.
Be Honest About Operational Costs
All nonprofits have operational costs that are not always clearly understood by donors. Help donors recognize the behind-the-scenes work that running your nonprofit takes and the costs of those operations. For instance, if you are trying to host a fundraiser, be honest about the amount of funding that it will take to host the event. Just make sure to emphasize that the fundraiser ought to bring in far more donations than it costs to put on.
Impact Transparency
Donors don’t just want to donate to causes, they want to donate to people. For repeat and new donors, it is important to showcase the effect of their contribution on the people and communities your organization serves.
Publish Testimonials and Stories
Help your donors recognize who they are helping when they donate by publishing personal testimonies and success stories from your nonprofit’s community. They should be widely available and posted in as many formats and locations as possible. For example, here at Educate. Radiate. Elevate., you can see photos and videos of and read about our team and the students we serve in our spotlights, our newsletters, our social media posts, our annual reports, and more! The personal testimonials and stories we share allow the people in our organization to speak directly to our donors. This is one of the best ways to hook new supporters and sustain long-term partnerships.
Share Data on The Impact Page
Share your company’s data on its impact page to show your impact. Include all relevant facts and figures such as the number of people helped, the total number of hours volunteered, and the amount of money raised. Make your point clear by translating these metrics into easy-to-read graphs and tables. Measuring outcomes and sharing impacts are vital for increasing donations. They prove that your nonprofit is effective and savvy and could help increase donations.
Conclusion
The best way to increase donations year-round is to improve the relationship between your company and your donors. Like any relationship, trust is paramount. Your donors need to believe that your nonprofit is reputable and honest. Improving your financial transparency by making your tax returns, impact assessment, and independent audit results easily accessible, proves that your nonprofit is allocating funds and spending donations wisely. Helping donors understand the inner workings of your company by sharing all the steps towards success, publicly listing notable staff members, and being honest about operational costs, enriches the relationship between you and your donors. Being transparent about your nonprofit’s operations endears donors to your company and makes them feel like a part of the team. Showing donors exactly who they are helping through personal testimonials, photos, and videos, matches faces to your cause, hooking donors in and sustaining their engagement.
