The challenges of donor-controlled gifts

February 28, 2017       The NonProfit Times      

The nonprofit sector abounds with stories of people who want to terminate or significantly change the requirements of a donor-advised funding plan. Very often disputes, such as children of the original donors charging that the recipient has diverged from the parents’ wishes, are acrimonious and, worse for the sector, high profile.

In his book “Charitable Choices” R. Daniel Shephard presents a wide array of information for people intending to makes some kind of donor controlled contribution to an organization. His intention is to avoid sticker shock or problems that can occur after the original donors have left the scene.

Shephard’s advice is aimed at (potential) donors, but it can be helpful for any nonprofit to be aware of the concerns that might be on the mind of someone contemplating a contribution.

  • For example:
  • Is the professional advice the donor has received from the organization’s representatives consistent with the donor’s own research?
  • Do promotional materials, both print and online, honestly and accurately represent all the available alternatives?
  • Were details of operating costs, fees and commissions shared willingly?
  • Was it difficult to identify and contact representatives of the organization?
  • Were those representatives more interested in listening or in talking?
  • Was it difficult to learn what portion/percentage of giving will directly serve recipient organizations’ missions?
  • Was it difficult to learn about consequences of a donor or successors neglecting to make gift-distribution decisions?
  • Was it difficult to learn for how long a donor will be able to direct or advise giving?