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Data Privacy: An Update Since We Last Spoke

By: Jessica Woodbridge, Senior Consultant

Jessica Woodbridge

Jessica Woodbridge

“U.S. must lead on privacy. Businesses need it, Americans want it, AI accelerates harms.”  – U.S. Senator Maria Cantwell, Chair of the Senate Committee on Commerce, Science and Transportation and author of the bipartisan American Privacy Rights Act (September 2024)

It’s been a year since my colleague Michele Borucki and I presented our session “Data Compliance: The Who, What, Where, When, Why, and How” at the 2024 NEDRA conference. It was also this time last year we published Data Privacy: Where We’ve Been and Where We are Going and Data Privacy (Part 2): Practical Tips and Better Practices to the Intelligent Edge. Since then, we’ve seen an uptick in data privacy enforcement as well as a need for more clarity by both organizations and the individuals whose privacy is being protected.

According to the International Association of Privacy Professionals (IAPP), 144 countries have enacted national data privacy laws, covering 6.64 billion people or 82% of the world’s population under the protection of some form of national data privacy legislation. Unfortunately, as of 2025 there is still no comprehensive federal data privacy law in the U.S. Rather, we see 20 states (5 more than this time last year) that have signed their own versions into law. The main themes among many of these state laws include individuals as consumers’ rights to their data, policies to opt-in for sensitive data as well as to opt-out of advertising and data sales, global privacy controls (a universal opt-out mechanism), a data protection impact acceptance process, as well as an automated decision-making policy. A growing focus appears to be on sensitive data and how it is processed as well as on data minimization. Maryland’s Online Data Privacy Act, which will go into effect in October 2025, has been noted as one of the strictest privacy laws in the country partly due to it imposing the strictest data minimization obligations and use restrictions.

2024 IAPP State Legislation Tracker

2025 IAPP State Legislation Tracker

It’s important to note that although many of these laws pertain mostly to for-profit entities, states such as Colorado, Delaware, Maryland, Minnesota, New Jersey, and Oregon do not exempt nonprofits in their privacy laws, and it is likely there will be more to come. Additionally, even if these laws are not applicable, nonprofits should be as diligent as ever in data hygiene and maintenance. Whether it be adding a donor’s email to a CRM system so they can receive the nonprofit’s messaging or sharing their intention of adding a nonprofit in their estate plans, our donors, volunteers, and other key stakeholders trust that we as data controllers will keep their personal data safe. It’s important for you to be aware of your organization’s protocol for who has access to prospect research and to make sure you are practicing data minimization.

While more than 40% of the country falls under these state privacy laws, it can be difficult to maintain compliance given that each state has its own version. In April 2025, the bipartisan “Consortium of Privacy Regulators” was formed between seven attorney generals and the California Privacy Protection Agency (CPPA). Through collaboration and pooled resources, the consortium’s main goal is to protect consumers’ privacy. Additionally, according to Connecticut Deputy Associate Attorney General Michele Lucan, “there is ‘a benefit’ for companies to deal with a group of regulators versus answering to individual complaints.”

We cannot discuss data compliance and privacy in the nonprofit sector without mentioning Artificial Intelligence (AI). In addition to not having a comprehensive federal data privacy law, no federal law exists currently for AI privacy. There are a few states that have incorporated “automated decision making” regulations into their privacy laws, including Colorado, Utah, and California. According to the New York-based law firm, White & Case LLP, “automated decision making can be understood to mean the use of AI, machine learning systems, and/or algorithms to make decisions with or without minimal human input and control.” Nonprofits may be using AI to increase operational efficiency, such as helping put together messaging for a marketing eblast, finding new donor trends, or assisting with prospect research. With this also comes the need to make sure the use of AI tools is in compliance with any pertinent laws. Some great resources for AI in the nonprofit sector include IAPP’s US State AI Governance Legislation Tracker, The Fundraising.AI collaborative, and APRA’s Ethics in AI for Fundraising Toolkit.

Looking ahead, it will be interesting to follow the “Consortium of Privacy Regulators” as it is just getting started. Also, staying abreast of the different comprehensive data privacy laws will be crucial as there are currently 12 more states with statutes/bills in committee. Data is an essential tool in our toolkit. Let’s continue to be good stewards of data through increasing our knowledge, collaborating with colleagues, and continually fine-tuning policies and procedures.

 

 

 

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Database Management is About More Than Just Data Entry

by: Melissa Bank Stepno, Vice President of Data Insight

The Thinker by Auguste Rodin (1882)

In my last Intelligent Edge blog post, Time For Database Spring Cleaning, I took on the topic of data hygiene and focused on the cleanliness and consistency of the data that is being entered into your CRM database.  But these are only two components of a comprehensive data management plan.

This month, I’d like to build on the topic and highlight some additional – or adjacent – considerations.  This is not exhaustive, but if you are interested in the health of your database, you should also be concerned about the laws and ethics that govern your data, as well as best practices around what to store and for how long.

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Legal Considerations – in recent years, data privacy and compliance laws have quickly grown in number, depth and purpose. As individual people and consumers, they are designed to keep our personal data safe.  As data and information professionals, they are numerous and cumbersome.

In addition to the ever-present General Data and Protection Legislation, or GDPR for short, which covers all of Europe, as of last count, 19 U.S. states have passed privacy laws (up from only 15 only a couple of months ago!).  Many more have pending legislation.  You can check out the IAPP’s fantastic website to track both pending and existing legislation.

In addition, a bill was introduced in Congress earlier in 2024 called the American Privacy Rights Act, or APRA for short (anyone else notice the irony that the acronym is APRA?), that introduces the idea of a national data privacy law.

And then, layer on industry specific regulations such as FERPA and HIPAA, that also govern what types of information can be collected, stored and shared, and with whom.

There’s a lot to keep up with!

My advice: educate yourself in the basics but consult with your organization’s general counsel or legal team for specific guidance.  Some of these laws are straightforward and others are not.  And, depending on the level of risk tolerance at your organization, you may see a different interpretation than at another nonprofit.

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Ethical Considerations – above and beyond what is legal for us to collect, we should also consider what is ethical for us to be accessing, using and storing.  After all, we are in an industry that places a high value on ethics – as it should – and many of our professional associations ask that we abide by their ethical standards.

Apra maintains an entire Ethics and Compliance Toolkit that is available to members and offers guidance on what to consider both broadly, as well as on a more nuanced basis such as how to appropriately use social media and an entire guide specifically focused on DEI considerations.

Also focused on DEI, aasp published DEI in Advancement Services earlier this year.  It is another great resource that orients around three the aspects of good data practice: data acquisition, data storage and data usage.

Ethical considerations are certainly not always black-and-white.  And, just like with the legal considerations, your organization may have a different threshold of what is acceptable or appropriate than another.  Using the recommendations in these sources as guiding principles can be helpful in determining your own policies and procedures.  But, always be sure to get leadership buying and organizational alignment before putting something into practice!

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Data Minimization – lastly, but not any less important, is the emerging conversation about data minimization.  It is estimated that there are more than 1.1 trillion megabytes of data created every day.  Most of it sits around and does nothing, serves no purpose, and is clogging up databases across every industry.

I’m not focused on ‘every industry’ though – I’m focused on ours.  Our databases collect a lot of data – as they should since they are our central and historical repository.  We even sometimes refer to them as our “database of record.”

But some of the data in our databases is so old that it no longer serves a purpose.  In fact, we may not even know proper definitions of what it is tracking/cataloging or the source/origin of where the data came from.

In reality, the topic of data minimization has grown out of the heightened focus on the legal and ethical considerations described above.

It’s also become a necessity in today’s world where data breaches are more common than ever.  Simply stated: the less data being stored in your database, the less risk.

Two great resources to consider are the DEI in Advancement Services guide from aasp mentioned above, which also covers data retention, as well as Apra’s Data Minimization Toolkit (requires membership).

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Good news!  You’ve made it to the end of this blog post and you are hopefully more informed than you were at the start.

Unfortunately though, this is not the end of your journey.  As with most things in our world, the laws, the best practice, and the guidance on these topics is ever evolving.  So, to be a good steward of your organization’s data, I would encourage you to stay continual updated and informed on this changing landscape.

 

 

 

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Let’s Get Political! Or Not?

by: Melissa Bank Stepno, Vice President Data Insight

 

In case you haven’t noticed, it’s a big election year!  Here where I live in NH, the hype starts early and it’s loud.  Having the first presidential primary in the nation means that the spotlight is on our little state once every four years.

Beyond NH, each election cycle brings a fundraising bonanza for the candidates, for the major political parties and for PACs.  In fact, the FEC reported that in the 24-months of the 2020 election cycle, more than $24 billion was contributed.  I would expect this number to be even higher when the 2024 election concludes.

As for the donors making all these contributions, logic would say that if someone is giving big bucks to politics, they likely have the big bucks for philanthropic contributions as well.

{Side note: this is where I’ll add my public service announcement noting capacity to give is only one piece of the puzzle.  Good prospecting strategy should also include an assessment of someone’s inclination to give your organization!}

 It’s very convenient that the Federal Election Commission not only requires that any contributions over $200 be reported to the FEC but that it also publishes the information making it super easy to access.

But Stop!  Do Not Pass Go.  And, do not collect your $200.

At one point, FEC data provided a treasure-trove of information for prospect researchers.

Historically, we used it to enhance information on known prospects, such as potential capacity, occupation and sometimes even home address.

We could also see who, or what, received the contributions, which could give insight into political interests, and in the case of PACs, sometimes a window into a donor’s charitable interests.

Unfortunately, the treasure ran out in November 2018 when the FEC issued new guidelines on the acceptable use of FEC data.  Included in the guidelines are statements such as:

Information about individual contributors taken from FEC reports cannot be sold or used for soliciting contributions (including any political or charitable contribution) or for any commercial purpose.”

“Commission regulations also prohibit the use of this information to solicit donations, including charitable donations.”

Quickly thereafter, the question of acceptable use of FEC data was brought to Apra’s Ask the Ethicist column.  The Ethicist, leaning on the Apra Principles of Ethics and Compliance, clearly advised us that since prospect research is part of the charitable solicitation process, we should no longer be using FEC data.

In 2021, recognizing the limitations of the new restrictions, ALUMinate, a vendor that was operating in our space, filed a compelling letter with the FEC asking that it reconsider the use case.  Effectively, the FEC declined to comment.

So, here we are, in the middle of an election year with such great data tempting us like forbidden fruit.

My advice? Follow what we do here at HBG which is to avoid any data that is gleaned directly from the FEC. 

However, thinking more broadly, there are some occasions where using political giving is acceptable – just not from the FEC.  Let’s look at a few examples:

But what about information on political contributions that I find in other sources, like a national news outlet?

Typically, referencing your source is sufficient to cite this information in your research.  Here’s an example: “According to a March 2024 article (insert URL) in the New York Times, Smith donated $10,000 to {name candidate}’s presidential campaign.

How about on social media?

First, be sure to follow your organization’s policies around the acceptable use of social media in general.  Assuming it is permissible then follow a similar format to the above: “According to this Facebook post (insert URL) on Smith’s personal page, he attended last night’s gala to support {name candidate}’s congressional campaign.  Gala tickets are known to cost in the $1K-$10K range.”

And how contributions to state elections?

State elections are not subject to FEC regulations.  Some states also publish political contribution information.  Each state has their own laws governing acceptable use so be sure to check those out before including anything in your research.

My parent organization has both a 501(c)3 non-profit and a political action committee.  We have separate teams and separate databases, but sometimes we share donor information since we find many of our donors contribute to both our charitable arm and our advocacy arm.  Do we need to stop?

The FEC guidelines state that “The sale or use restriction does not prevent a committee from compiling and distributing its own list of contributors. A committee may donate, sell, rent or trade its contributor list to other committees and organizations.”  So, as long as the staff of the PAC are providing the information to you directly, you should be in the clear.

Bottom line: the political season is heating up, but using data from the FEC is not.  With everything else in our line of work, erring on the side of caution is always the best route.  While this blog post is not meant to replace actual legal advice, hopefully these scenarios give you a sense of how you can incorporate information about political giving into your research.  If in doubt, my best advice would be to consult your in-house legal team or leave it out of your final deliverables.

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It’s Time: Highlighting Six Changes

Two weeks ago, I attended my last Apra Board Meeting, immediately followed by the 2023 Apra Prospect Development Conference.  As a team building exercise, we kicked off our board meeting with “6 Word Memoirs.”  As one might expect in a group of about a dozen people, the tone and tenor of our memoirs varied – some professional, some personal, some serious, some funny, some focused on being “in the moment”, others focused on lifelong characteristics.  Mine was as follows:

This Year.  Many Changes.  Reflective.  Bittersweet.

For those who do not know me, 2023 has been a year of change.  About 6 weeks prior to the conference, I started in my current position at The Helen Brown Group.  And, after 6 years of being on the Apra Board, my term was coming to an end.

As such, my mood was very, well, reflective.  As you might imagine, a 6-year board tenure could feel like both a short and long amount of time.

On the one hand, some things within Apra and within our profession have not changed over the past 6 years – and maybe they never will.  We are still debating whether the full prospect profile is “alive” or “dead.”  We are still complaining about database conversion projects.  Most of us are planning, in, or about to finish some type of large capital campaign.  You get the idea.

On the other hand, over the past 6 years our industry has changed, evolved and grown substantially!  Like many of us, I don’t always like change.  But, change is not only a constant, it is also necessary.  I have learned to embrace the later.

Also like many of us, I often have trouble seeing the forest through the trees.  So, since the themes of change and sixes have both been on my mind, I thought: it’s time to highlight 6 “trees” that have sprouted in our industry’s “forest” over my 6 years on the Apra Board.

 

1. COVID – COVID had a transformative impact on almost every aspect of our lives – professional and personal. Did I really need to mention this?  Probably not.  However, it was so impactful that how could I not mention it?  Enough Said.

 

2. ChatGPT, AI and similar – do I think ChatGPT or AI is going to replace our profession?  No.  Do I think they are going to change the way we do our work.  Absolutely.

Some of us are old enough to remember when the Internet was rumored to replace our profession and it obviously didn’t.  We are still here!

However, I think we’d all agree that the way we work is significantly different – more efficient and faster – than the days of library visits, stacks of books and lots of phone calls to request information.  My suspicion is that this era of technology innovation will have the same type of impact, forcing (in a good way!) us to evolve.

 

3. DAFs – Did Donor Advised Funds exist 6 years ago?  Yes.  In fact, there’s a great blog post by my colleague Jayme Klein here that reviews the history of DAFs.

However, in the past few years the importance of DAFs and their impact on our industry really started to explode.  In fact, according to the National Philanthropic Trust, DAFs grew 28% in 2021 alone.

Those who follow GivingUSA have also noticed that over the past couple of years there has been a decline in individual giving alongside an associated increase in foundation giving.  Most experts attribute a portion of this shift directly to the impact of DAFs.

If donor giving patterns are changing, our industry must learn to adapt and keep up with those changes.

 

4. Data Governance and Privacy Landscape – while FERPA and HIPAA certainly existed for way longer than my six-year looking-glass, we now have an alphabet soup with GDPR, CCPA, PIPEDA and VCDPA added to the mix. This, of course, is an evolving landscape with legislation pending (or already in effect) in other states and countries.

Sites like The Nonprofit Alliance can help us track legislation.  However, knowing about the law is only ½ the battle.  Perhaps the bigger challenge will be in the nimbleness and complexity needed to adhere to all of variations across so many laws.

 

While my first 4 are broad and impact the entire philanthropic landscape, I wanted to reserve my last 2 specifically for Apra, since my tenure on the Apra board was the inspiration for this post.  Of course, many trees have sprouted within Apra over the past 6 years.  I’ll highlight two:

 

5. Apra’s DEI Data Guide – In 2021, Apra published its first version of a new DEI Data Guide (spoiler alert: an updated version is due to be published later this year, along with a brand new asset on data minimization!). The Guide’s purpose is to serve as a resource for best practices in the ethical collection, storage, and usage of DEI data.

Sure, Apra was talking about DEI 6 years ago.  And, Apra has always prided itself on providing an ethical guidepost for the philanthropy profession.  It even has an entire section of its website focused on Ethics and Compliance.

But talking about something and having text on a website does not make it a seminal cornerstone of a professional association.

It is to this end that the importance of the DEI Data Guide cannot be understated, especially as Apra is a community that lives, breathes and thrives on using data to advance philanthropy.

In quick stead, the Guide has also served as a launch pad that helped elevate Apra as “The Leader” in assuring the proper collection, use and protection of donor data across the entire philanthropic sector.  In fact, the Guide has been promoted in efforts by AFP, CASE, aasp, and the Chronicle of Philanthropy, just to name a few.

 

6. Due Diligence – Okay, full disclosure: I was having a bit of trouble picking this last one. There was so much to choose from that I really couldn’t decide!

My mind was quickly made up when I read Heather Willis’s Intelligent Edge post last week on Comprehensive Due Diligence Research.  Of course!

Due diligence has always been in the back of a researcher’s mind.  I distinctly remember an example from my time as a Prospect Researcher at Boston University when a colleague realized that a prospective donor was possibly connected to a terrorist organization.  Yikes!  What to do?  We talked about it and made some ad hoc decisions on how to handle next steps.  We had no formal policy or procedure in place.  This was twenty years ago.

Now, Due Diligence is a practice of its own with guideposts and guardrails to follow.  We’ve come a long way, baby!

In addition to Heather’s great insight, also check out Apra’s Due Diligence Toolkit, published in 2020, along with about a dozen other resources in Apra University, all published in the last few years and including a 2021 webinar featuring HBG’s very own Michele Borucki and Jayme Klein! (note: some links require an Apra membership).

 

Each one of my “sixes” is worth a full blog post on its own!  But for now, I’ll leave you with these brief thoughts on each as I set my sights on building my next 6 Word Memoir…

 

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The RiF Prospect Research Handbook is out today!

Lots of times we might have a brilliant idea to nudge forward (or perhaps even revolutionize) our profession, but then we think, ugh, is it worth it? That would take forever! And we go back to whatever it was we were doing before our daydream.

Fortunately for all of us that’s not what happened back in 2019 when Ben Rymer, then chair of Researchers in Fundraising (RiF), dreamed up the bold idea to create a soup-to-nuts Prospect Research how-to Handbook. In case you’re not familiar with RiF, it’s the professional association for prospect researchers in the UK. Just like Apra here in North America, RiF has a great conference every year (theirs is in November in London) as well as gatherings throughout the year.

The RiF Handbook (available today!), called Researchers in Fundraising: Best Practice Guide and Handbook for Prospect Research has been a labor/labour of love for many of us in the prospect research community. I was lucky enough to be one of the volunteer editors for a segment or two, and I was impressed at what a well-run machine it was, and what a great job that the project’s manager Ally Lee-Dudley, founder of Adcumulo, did of keeping the operation running so smoothly.

I was interested to learn more about the Handbook and the process of creating it, so I got in touch with Ben, Ally, and Chris Davis, RiF’s current chair, to find out more. Sincere thanks to Ben, Ally, and Chris for sharing these great insights!

Helen: Ben, how did the idea come about to do a Handbook for prospect researchers?

Ben Rymer: When I sent the initial proposal to the Chartered Institute of Fundraising (CIoF) in August 2019, I’d known for a while that a handbook/textbook/how-to guide was needed. My feeling was that prospect research was still something of a trade, rather than a profession or discipline. We have a huge amount of expertise, experience and goodwill in the community, but it had never completely crystallised into a finished product so we could build on and improve existing good practice.

HB: What was your initial plan for the scope of the project, and did that change at all as it evolved?

BR: All I knew was that the main areas of research practice should be included. Basically I wanted to create something that I would’ve found practically useful in my first job in the sector. We cast the net wide in starting, with plans for 23 chapters. The big trade-off since then has been in response to volunteer availability. All the content is crowd-sourced, and so we have to work in sequence with the expertise of volunteers who come forward … Also, Covid hit a short time after project kick-off, but we pivoted to remote working pretty well, thankfully.

HB: Ally, how did you get involved with the project?

Ally Lee-Dudley: My involvement with the project began in January 2020 when the Steering Group were looking for a Project Manager to move the Handbook from a great concept to a work in progress. At this time there were not yet any structures, processes, or resources in place so this really was the beginning of the Handbook as an active project.

HB: How many volunteers were part of it?

AL-D: To date around 90 volunteers have contributed to the Handbook, some as writers, some as editors, some as beta-readers, as some as micro-volunteers. Volunteers come from 3 different continents, and around a dozen different countries making the volunteer effort an international collaboration.

HB: How many chapters are there, and how was the decision made on which topics to include?

AL-D: At launch, 8 chapters are available for readers plus a Resource Director and Glossary of industry terms and phrases. There are another 7 chapters in progress which will be published as and when they are completed and a further 11 chapters that are yet to be started. Publishing content on a staggered basis like this means we are able to start getting useful content out and into the prospect research community far more quickly than if we wait for a ‘complete’ Handbook. The original list of potential chapters was developed through discussions between the volunteers who make up the RiF Committee. Over time several additional chapters have been added to that list as a result of suggestions made by volunteers involved with the project.

HB: Chris, as the scope of the project evolved, what changes did that cause you to make?

Chris Davis: As we added more chapters to the Handbook, we found ourselves looking beyond our immediate peer group for input and advice, to those with specific expertise or lived experience. For example, in our chapter on Strategic International Prospecting, we were aware that we needed to get as much input as possible not only from researchers with extensive knowledge of international prospect research, but also from those with experience of living or working in different countries and communities. This was definitely a challenge, but I hope we got the balance right! Similarly, when we start work on the chapter on Equality, Diversity & Inclusion in Prospect Research we’ll be seeking involvement from those who are experts in the ED&I space.

HB: What surprised you most about the process, or what created the most changes or opportunities as things went along?

CD: I think I was surprised by how much content we ended up generating! I knew that the prospect research community would be hugely generous with their time and knowledge, but I was still taken aback at times by the volume of work we ended up producing. At this point I’d have to give a big shout out to our beta-reading and editing volunteers, who were a major help in clarifying and refining the chapters and getting them to where they are now.

HB: Ben, what do you think are the top 3 things that readers will find that might surprise them?

BR: 1. Reach: it is a big thing! Chapters I’ve worked on have ended up being 10,000-20,000 words long. We also have a very broad range of topics, so I think readers will be pleasantly surprised at that.

  1. What’s still to come: by the same token, there are some big chapters in the pipeline, so reader may be left waiting for those. If anyone has suggestions, please feel free to get in touch via the Handbook website, www.rifhandbook.info.
  2. Quality: we’ve put a lot of effort into making the content as good as it can be. For a wholly volunteer-generated initiative I think it is a solid product, but I’m biased of course!

HB: Chris, what do you think are the top things that you think readers will find most useful in the Handbook?

CD: I think that will be different depending on the needs and experiences of readers – throughout the Handbook we’ve tried to ensure that content is relevant for both those who are new to prospect research and for experienced researchers who are looking to innovate and upskill.

For early-career researchers or those who are setting up a prospect research function, we hope our New Researchers Guide chapter and the chapter on The Prospect Research Role will be invaluable. Within the Data & Skills Domain of the Handbook, there is some very detailed, nuanced, and in-depth content on estimating wealth and assigning capacity ratings – topics that we know are of eternal interest to prospect researchers and fundraisers alike!

Finally, we’ve made extensive use of case studies throughout the Handbook, drawn from the real-life experiences of researchers. We hope these will really bring the content the life and illustrate how the principles and techniques outlined in the Handbook can be applied practically.

HB: Chris, what did you enjoy most about the process?

CD: I’ve really enjoyed the experience of being involved in creating content for the Handbook, especially the early stages of this where you are exchanging knowledge with your peers. I’ve been working in prospect research for over a decade, but being involved with the Handbook has absolutely encouraged to rethink some of my settled views about the work that we do, and how we do it. I think the Handbook does reflect this process of peer exchange, and I hope that everyone who uses it will find something new and different in there that challenges their assumptions.

HB: Ally, What tools did you use for collaboration on this massive project and how well did they work? If you had another large collaborative project to undertake, would you use the same tools?

AL-D: The Handbook was always intended to be primarily a remote project, so in that sense we were lucky and the pandemic didn’t significantly affect our plans. In order to help ensure both accessibility of tools at no cost for volunteers and to help embed project sustainability by keeping the financial burden of the project low for RiF, we’ve largely drawn on tools that are available for free. As a Steering Group, our project management hub is a tool called Freedcamp, and this enables us to plot and track actions, deadlines, and milestones and assign task accountability at a strategic level.

For the Handbook’s wider volunteer community, the free version of MS Teams is our collaborative workspace. Teams provides us with a place to create, share, and store documents such as meeting agendas and action plans, and to work collectively on producing and editing content in real-time whilst being able to communicate quickly and easily with each other. Within Teams volunteers can access the web versions of MS Word and Excel so we’re all using the same tools to ensure compatibility plus there is in-build versioning history and storage back-up for those ‘just in case’ moments.  We’ve recently made the switch from using Zoom for our regular meetings to using MS Teams’ video calling service; it doesn’t quite have all the same features as Zoom but it does come at zero cost rather than requiring a subscription to hold meetings for small groups for up to an hour at a time.

The Handbook itself is created using a custom-made WordPress website. We chose the route of e-publishing over hard copy for several reasons and the WordPress platform, with its almost unlimited flexibility and versatility, is the best fit to meet the Handbooks needs both now and in the future. As an e-publication it is not only much easier to keep the Handbook content up to date, it is also far simpler to ensure its availability to readers around the world who can access the content from any device with a web browser.

Overall, aside from the usual occasional IT glitch, (we’ve done the equivalent of turn it off and on again once or twice), the tools we’ve chosen have been effective and created not only a conduit for remote productivity and development, but also a space to come together a a community and experience that sense of being part of a team working towards a common goal that is so important to the Handbook.

Many thanks again to Ben, Chris, and Ally for sharing the inside scoop on the RiF Prospect Research Handbook, and for all of the hard work and coordination that went into creating it! Check out the Handbook website at www.RiFHandbook.info. If you would like to be a volunteer writer or editor for future chapters, please visit this page to learn more.

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Hope and Charity

In the Before Times, we were more at leisure to have philosophical discussions about the nature of philanthropy and income inequality and taxation and due diligence and ethics and the confluence (or colliding impact) of all of those things.

With the daily grinding worry of every sorry aspect of the COVID pandemic starting to recede for many of us (in countries with leisure classes), those discussions have started anew – but with the added grit-filled lens of 20/20 in our hind-sight.

It’s a time of social upheaval we’re living through right now, and maybe we’re lucky to be living through it, because after the awfulness, we can hope that good things will come. World wars, influenza pandemics, suffrage, civil rights, gay rights – you can’t say that those were good times for the people who moved them forward, but they were working with hope for a better future. And better things did happen.

Philanthropy is about nothing if it’s not about hope. I have said that phrase so many times over the years and it has only ever had one meaning to me. But looking at our sector now I see with more clarity that it’s actually about two things.

It’s about when philanthropy is about nothing. And when it’s about nothing but hope.

I have two things that I want to tell you about that led me to that realization, because I was struck by how philanthropy can actually be about nothing.

Earlier this month, the Boston College Law School Forum on Philanthropy and the Public Good released a report called “Impact of the Rise of Commercial Donor-Advised Funds on the Charitable Landscape 1991-2019.” (Honestly, take a look. It’s not a boring report. Ray Madoff and James Andreoni wrote it, and there are awesome visualizations by Helen Flannery).

Here are some meaty takeaways:

  • Since 1981, charitable giving in the United States has stayed steady at about 2 percent of disposable income.
  • Fidelity established the first commercial donor-advised fund (DAF) sponsor, Fidelity Charitable, in 1991. At that time, about 5% of giving went to foundations with the rest – 95% of giving – going directly to charities.
  • By 2019, 13% of all giving went to donor-advised funds and 15% went to foundations, so that means only 72% went directly to nonprofits.
  • Private foundation assets have grown over 500% over the past 30 years, from $165 billion in 1991 to $996 billion in 2019. From 2007-2019, total donor-advised fund assets grew over 300% from $32 billion in 2007 to $142 billion in 2019.
  • Madoff and Andreoni, in collaboration with analytics firm Data Lake LLC, crunched numbers from Giving USA and form 990s to find out what would have gone directly to charities if it wasn’t for DAFs and foundations. Their calculations show that between 2014 and 2018, nonprofits missed out on about $300 billion.

Three. Hundred. Billion. Dollars.

So there’s money moving into “philanthropy” but it’s not going to the nonprofits that do the work. This is when philanthropy is about nothing, and certainly not about hope. This is about amassing assets and control. It’s the business of philanthropy.

A really interesting overview

The second thing I wanted to point you to today is a piece from BBC Radio 4 in the UK called “Tainted Money.” It’s well worth your 27 minutes and 45 seconds.

It’s presented by Dr. David Cannadine, a specialist on the history of business and philanthropy and professor of history at Princeton.

Cannadine distils the concerns and struggles within the charitable sector today – the growing importance of due diligence research, ethics in fundraising, income inequality, and the nature of unequal power in philanthropy.

Along the way he interviews or features audio clips from several people who are well-known within philanthropy circles including Dr. Beth Breeze, Prof. Rob Reich, Anand Giridharadas, and billionaire philanthropist Stephen Schwarzman, among others.

The segment brings up some great questions, including:

  • If we put on our nonprofit’s no-fly list anyone who could possibly be (or have been) tied to some form of tainted business, at what point is there no one left for us to ask?
  • What causes should billionaires (not) be allowed to influence with their largesse? Who decides?
  • Are tax evasion/avoidance, income inequality, and the business of philanthropy inextricably interconnected or are they separate but concurrent problems?

These are fascinating and difficult issues for us to be aware of and we all, from our unique perspectives, have a part to play in figuring out how we move forward, whether that’s in our own department, our own nonprofit, as leaders within our regional and national professional associations, and as caretakers for the future of our sector.

We have to work with hope, and we have to work at it.

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4 Mid-COVID tasks that get you ahead

Hi there, and welcome back to the Intelligent Edge: mid-COVID edition.

While we’re hopeful that at least one of those 50-odd vaccines in development will work – and that it really will be ready early in 2021 – that’s still half a year away.

So, now’s a good time to take realistic stock of where we’re at, see what we can do to make the most of right now, and plan as best we can to make things easier for ourselves next spring and mitigate future disruption.

From prospect development and operations perspectives, what might that mean?

Top prospect checkup

Well, first, we’re all keenly aware that the pandemic has impacted businesses – so many businesses – in a negative way. Now is a really good time to do a quick scan of your top 25-50 prospects (for large organizations, that would mean the top 25-50 in each major gift officer’s portfolio).

  • How has their financial situation changed, if at all? Recalculate ratings accordingly.
  • Is your donor in a fairly stable (or growing) industry right now? Can you code that for pulling reports?
  • Have they made any recent large gifts, either to your nonprofit or to another?
  • Do they have a donor advised fund? If so, it is noted/coded in your database?
  • Check the obituaries to see if there has been a recent death in their family (which, I know. It’s just unbelievably sad that we need to do this, but it’s important).

End-user check-in

It’s not just our donors and their companies that have been impacted. We have been, too, of course. Everybody’s needs have changed. No matter what your position, now is a good time to check in with your supervisor and other end users to be sure that the reports and information and work you’ve been producing is still helping drive things forward for them.

  • Do they need less information because concentrating on large reports is tough right now?
  • Do they need the information bulleted, or in prose, or in an audio memo, because it’s easier for them to absorb?
  • Do they need different information? Is something else about their prospects more important than it used to be?

We’re not in the same-old same-old anymore. We’ve all changed, and our needs have all changed. Check in to see how you can meet the new needs that exist.

 Data hygiene checkup

If you’re having  trouble concentrating, now is a really good time to do mindless data hygiene tasks. You know, the ones you’ve been putting off. Crank up the music and get them done.

For example: Currently in your database in the company field for 38(0)(00) of your constituents, I can say with some certainty that there are a nearly-equal number of permutations of the same company name. Goldman Sachs. Goldman Sachs Group. THE Goldman Sachs Group. Goldman. GS. GSG. Goldman Sacks.

If you fix those now when a fairly auto-pilot task is just the ticket, in the future when you want to pull a report to answer the prospecting question “hey, just how many constituents do we have that work at Goldman Sachs?” you won’t get that sinking “UGH! I have to put in 38(0)(00) different queries!” feeling.

Also, if you haven’t looked at your data entry policies (or written them at all), now is a good time to do that, so that you avoid those messy name permutations (and any other data inconsistencies) in the future.

Ethics, Due Diligence, and The Law

Was your organization affected by the Blackbaud breach? Did it catch your team flat-footed when you tried to figure out how – or if – you needed to respond or send a notification to your constituency?

Did you write down the policies and procedures you learned through that process? Do you now have someone in your organization who is responsible for managing the process and/or response when something similar happens again? If not yet, do that now.

(If you’re not a Blackbaud client, have you gotten in touch with your database vendor to find out what precautions they’re taking to avoid placing you in the same situation?)

The first lawsuits that sprang up in the Blackbaud data hijacking situation were aimed solely at the company. However it was announced this week that a new lawsuit, Cohen v. Blackbaud Inc,. also names Harvard University, Bank Street College of Education, and the Lower East Side Tenement Museum as defendants. (More information here$ and here).

There are probably more lawsuits to come. As prospect research professionals, we can help our fundraising teams stay on top of the news as it comes out.

We also tend to be the ones who are on the front lines of ethics, due diligence, and conforming with the laws that pertain to information-gathering and fundraising. These aren’t the most gripping topics, but they are important.

Can you discuss with leadership and opportunities for your team to gather for lunch-and-learns around ethics and data security? What does your team need to know to be prepared for a data breach, or to be sure you’re compliant with laws and ethics requirements?

What are you working on?

So those are just a few ideas for (actually really important) things you can do right now to stay ahead of the game and be prepared for the next few months. What are you doing right now to be prepared? Share it in the comments and bring your ideas to others!

If you want to hear more about ethics, due diligence, the law, prospect development, and how you can start those discussions in your nonprofit, join me at the APRA-MN virtual conference on October 20!

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Questioning philanthropy

With so many nonprofit organizations needing funding fairly desperately right now, this might not seem like a particularly great time to critique philanthropy and philanthropists. That hasn’t stopped people like Anand Giridharadas, David Callahan, Rob Reich, Ben Soskis, Alan Cantor, the folks at Mother Jones, an anonymous op-ed writer in The American Conservative, and many, many others.

And the critics have a long list of grievance: Foundations have too much power. Foundations don’t give away enough. Billionaires are stingy. Billionaires are stepping up, but not enough. Wealth inequality is distorting philanthropy. It’s imperiling democracy. DAFs are the best thing since sliced bread. DAFs are evil.

It feels like there’s a crescendo of criticism lately. And they’ve got a point – there is so much more need, the inequity gap is an increasingly yawning crevasse, and trillions are locked away in philanthropic vaults, ticking up interest and income for investment offices and institutional sponsors. And there are billionaires who could change the course of poverty/hunger/you-name-it with one check (and some, like MacKenzie Scott, who seem to be actually trying).

As they have for over a generation, medium and large nonprofits are focused laser-like on that top tier of prospects and those prospects’ assets are growing by the second, even during this pandemic. Some because of the pandemic. Sometimes I think that small triangle at the top of the pyramid is going to separate and blast off like the SpaceX Dragon.

A small voice in me wonders if prospect development has played some role in this problem of declining donor numbers. Because of our part in the fixation on that nose-cone.

And, to be fair, it has made practical sense, right? When bank robber Willy Sutton was asked why he robbed banks, he said “because that’s where the money is.” Well, yeah.

Have we been myopic?

So yes, we’ve focused on the richest of the rich because they’re the ones with the most money to give away. But is that one (of the potentially many) reasons why our nonprofits have shrinking donor pools? Because we haven’t spent the time to identify and involve the next generation of donors because the low-hanging fruit was just so much easier?

What about the next tier who may not be able to make 7-figure gifts now (or ever), but could make multiple 5 or 6 figure gifts over a lifetime? Have we in PD not done our duty to insist to leadership that those prospects are worth the work so we can ensure that fundraisers working at our organization in 10 years’ time have great portfolios to work with?

Is the scarcity mindset that deeply entrenched in our sector’s collective psyche that nonprofit leadership doesn’t feel it can take the long view to ensure that their nonprofit will be here in 50 or 100 years and needs to go for the quick wins now?

Or, to play devil’s advocate, in this increasingly unequal world is it more expedient (and ethical) for us to have stayed focused on the top of the pyramid to the…maybe not exclusion, exactly, but certainly decreased emphasis on that important second tier? I wish I was sure. That small voice gets louder these days telling me “no”.

Fortunately it’s not an either/or choice. Those critics are airing out the Third Sector’s dirty laundry and it doesn’t smell too rosy. So what we have here is an opportunity for all of us, particularly in prospect development.

So what can we in prospect development do?

We have to start involving people below the Forbes 400 level – now – for all kinds of reasons.

First of all, although their bank accounts are growing at astonishing levels and their numbers are creeping up slowly, ultra-high net worth individuals (UHNWI) are still a tiny subset of the general population. Also they tend to give their support exclusively to large, well-established institutions (the equivalent of the Forbes 400 of the nonprofit world).

Second, I don’t know of too many nonprofits whose constituencies are exclusively over 60, male, and white. All-white boards may have worked in the 1970s, but we all know that style of board should have died out long ago. The fact that the status quo has lasted this long is frankly lazy and embarrassing. Female and BIPOC representation amongst trustees, volunteers, donors, and fundraisers, has to increase and fast in order for nonprofits to stay relevant (and afloat).

And third, donors have an increasing number of giving choices that completely bypass nonprofits and go straight to the recipient. Let me repeat that – donors are bypassing nonprofits entirely (read the embedded-linked article in that last line). Or they give money to nonprofits through vehicles like Facebook, which cuts out the nonprofit/donor relationship. Right now, when people can’t get out to volunteer or to attend events, these options are a way for mid-level donors to make a direct impact. This makes prospect identification, philanthropic-interest research, and engagement all the more difficult for an increasingly important demographic.

And although they may not be 100% correct, the critics care enough about the success of our sector to venture an opinion and point out where we need to fix things.

As a prospect development professional, I can’t fix DAFs, or foundation payouts, or wealth inequality, or the tax code. But there are many things we definitely can do to make our sector – and our own nonprofits – better. And that starts with making the pie bigger.

Elbow-grease prospecting and segmentation are even more critical right now. There are opportunities in every single fundraising database to be found through analytics and wealth screening, peer networks and philanthropy. There are common-sense ways to find new or previously overlooked donors in the communities where we operate and that we serve.

As an industry, we need to figure out how to present newly-identified prospects in such a way that fundraisers will rush to set up a Zoom call. And managers need to find new ways to motivate fundraisers to do that. Great prospects sitting in a portfolio growing cold are the very worst kind of waste. Internally we need to discover ways to communicate excitement and opportunity.

Something that’s been exciting for me is a project we’re working on right now within our Data Insight team: identifying the ways that the research tools we use don’t identify (or appropriately weight) female and BIPOC prospects and building up our own custom appends and methods to counter those deficiencies for our clients.

I’d love to hear your thoughts about any or all of this.

 

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Innovative Ideas for Ethics Discussions

A good friend’s daughter just started her first ‘real’ grown-up job, and it’s in the development office of a nonprofit that resonates with Wren* on many different levels. It fulfills a mission she’s deeply cared about and has actively volunteered for for many years. She’s thrilled to be working for them and it seems they are just as delighted with her.

Wren reported to her mom that they held their holiday party this week and, after an energetic and laughter-filled Yankee swap, the discussion turned (as pre-arranged) to fundraising ethics. The leaders had brought several current-events topics for everyone to discuss, and they broke up into groups to talk about them. As the groups reported back, there was more fascinating conversation, as I understand.

I couldn’t help but be (even more) impressed by this nonprofit and its fundraising leadership. And how innovative of them to introduce the topic at the holiday party! Everyone was already gathered together, (so there was no special meeting required) and of course they were much more relaxed than they would have been in a sterile Mandatory Ethics Discussion Meeting on a Tuesday at 3:30 (yawn).

Wren reported that ideas and opinions flowed freely, and the discussion helped her get to know her new colleagues better as well. It sounded like the whole segment was prepared and handled really well.

Using innovative technology to talk about ethics

And speaking of ethics discussions being handled really well, last week I went to a strong session on ethics at AFP-MA’s Fundraising Day. The session was led by Mary Doorley Simboski ACFRE, a long-time fundraiser and lecturer at Boston University, and Gavan Mooney, President and Chief Client Officer of the fundraising consulting firm Changing Our World.

Simboski and Mooney’s innovative approach included using a live-polling app that allowed each of us to vote on our phones and see the results in real time as we got more information about an ethical situation under discussion. Seeing the bar charts rising and falling in relation to each other added a fun horse-race-like element, and there were always surprise answers mixed in.

We then talked about aspects of each case in a candid environment where I heard unexpected viewpoints that further increased my respect for the ethically tenuous situations frontline fundraisers sometimes find themselves in. The group also talked about the importance of due-diligence research which (of course) warmed my heart!

Talking about ethics really isn’t optional anymore

Ethics discussions are increasingly important these days, both for readiness to meet these situations with skill when they arise, and because our donors expect that we will behave ethically.

It’s exciting to see the innovative ways that these discussions are happening, and I’d love to hear what your office is doing to create engaging, interactive discussion and learning around ethics?

 

*Wren is not her real name

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The scariest things about fundraising

“Citroulle préparée pour Halloween.” Photo by Carole Pasquier

Since today is Halloween, I thought you might like to help me by sharing some of the scariest things you’ve seen happen in a fundraising office. It doesn’t have to be your office, it can be an incident you heard happened elsewhere. Or you can pretend it did. I’ll start first, but please feel free to add yours in the comments!

Spooky Oversharing

My first story has to do with an email I received two weeks ago (and two months ago, and two years ago, and…) from someone sending confidential information via email. I recoil in horror every time I open up an email and see a list of donor names with addresses and giving information. Spouse names. Strategy statements. Or, heaven forbid, an attached un-password-protected Excel sheet.

Why this is so scary: email is not secure. In fact, email is the very least secure way anybody can send information in the universe. You may think, “I’m just sending it to Chris down the hall.” But in order to get to Chris, that email travels across state lines (and sometimes across country borders and several time zones) to get from your computer to Chris’s. It goes through a ton of servers, any one of which can siphon off your email to read later.

(Also please change your email password at least every three months. Two-factor authentication is a pain in the rear but could save that same rear.)

Scary Language

The second thing that scares me about fundraising is the language we use. Lori Hood Lawson started a great conversation on Twitter with this:

Those of us on the thread decided that “Prospects” as a term actually passed muster, but “Suspects” got a big, hearty, NO. Likewise “Portfolio penetration.” Ew. Just no.

Another word that was mentioned as needing to go was “pipeline” – not because it’s scary but because it can be confusing. Are we talking gift pipeline, prospect pipeline, or donor stewardship pipeline? The context needs to be specific but isn’t always. Which is another problem:

Fundraising language can be impenetrable like The Fog, (see the terms “Advancement” and “Development,” for example), and it would help if we had industry-wide research-and-development to find new terms.

And by new terms I mean good terms. Clearly descriptive terms. Not creepy terms like “suspect,” or “portfolio penetration.” And not amorphous terms like “resource development” or “prospect development” which sounds like we’re embarrassed about what we do so we hide it in a hazy term that doesn’t mean anything.

Ethical shadows

The last scary things I want to mention about fundraising are the topics of ethics, donor domination, and the #MeToo issues that have come to light lately. I think we can all agree it’s been a fairly stomach-turning season with the recent Epstein scandal; nonprofit decisions on how to handle past Sackler (and other disgraced donors’) giving; and a wellspring of discussions around sexual harassment and gender-based pay disparity.

It’s been a few seasons, actually, if you factor in the fairly constant media focus on the fundraising sector in the UK and the regulations and fines that have sprung from a few bad actors’ misdeeds.

Fortunately, now that it’s come to light, all of this is fixable with level heads convening to find workable solutions. The scary thing would be if nothing happened.

What scares you about fundraising?

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