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Swimming Against the Tide of Efficiency : DEI and ROI

It seems lately like everywhere I go in my consulting work, nonprofits are talking about diversity, equity, and inclusion (DEI). Many of our clients are going to new trainings, reading books about DEI, and wrestling with how to make it real in their planning and operations.

As a fundraiser, I’m really excited about this. For far too long philanthropy – like income in the US – has been more and more concentrated into the hands of a few. As a result, foundations, major donors, and corporations have oversized influence and power in the nonprofit sector.

It’s exciting for me to consider how we change that. What if everyone in the community had the opportunity to participate as a philanthropist? What if every-sized gift were valued and welcomed equally?

These big thoughts would require large structural change in the sector. While we often hear about diversifying donor bases, we very rarely hear this hard truth. Truly inclusive fundraising is more expensive. It takes more resources. It also runs head-on into the way fundraising operates in the US.

Most fundraising operations today are very much top-down and inside-out. Large donors get more attention than smaller donors. We ask our insiders – our boards and major donors – to connect us with others in their circles. We provide exclusive access for major donors and foundations. We have silent phases of campaigns for our largest prospects and naming rights to reward their largess. These are not exactly practices that reflect the principles of diversity, equity, and inclusion.

We didn’t build fundraising this way to intentionally exclude people. We built it this way because it’s the most efficient way to raise money for the causes we work for and believe in.

It’s a long-held tenet that fundraisers can generate more net income by focusing on our major donors and prospects, large corporations, and foundations than we can in cultivating smaller gifts and new audiences.

Adding to the mix, watchdog groups have conditioned an entire generation of donors, boards, and nonprofit executives to keep fundraising costs as a percentage of revenue as low as possible, to be as efficient as possible.

But the benefits of an inclusive donor base are not measured in traditional efficiency ratios or return on investment (ROI).

A diverse donor base brings broad support, diverse perspectives, new talent, and resilience through times of adversity. Most importantly, a diverse donor base is the future.

Are you ready? Have you had conversations about what it means to have an inclusive and diverse donor base and the organizational investment it will take? Are you and your board willing to challenge short-term efficiency for long-term gain?

2 Comments

  1. Mike Allison says:

    This is a really good point Leslie, and indicative of the other choices that need to be made to honor values over the sometimes real, sometimes presumed benefits of efficiency.

  2. Leslie Allen says:

    Thanks so much, Mike, for your comment. I could not agree more. Efficiency drives a better return on investment, but maybe it’s time to think of other metrics for measuring fundraising success. Got any suggestions? And thank you, Mike, for all the great work you do!

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