Your clients want to give, but they may need some guidance on choosing their charities – more importantly, they may be looking to you to be that guide. Are you ready for that challenge?
It is a long-term process, but it begins with some research, according to Marvi Ricker, vice president and managing director of philanthropic services for BMO Private Banking.
“Once we’ve decided what it is they want to fund – let’s say it is youth at risk – we then start to look at organizations that are working on these issues,” says Ricker. “You have to get to know the organizations – start to learn about them by making site visits, read about them, talk to others in the sector who are doing good work.”
While the advisor should be ready to provide suggestions to the client, the client should be encouraged to do some research of their own. Imagine Canada publishes a Guide to Giving
that is brief but offers helpful tips and resources for donors looking to get better informed.
“Clients need to do their due diligence. There are lots of websites where you can get information on charities,” says Jo-Anne Ryan, vice president of philanthropic advisory services at TD Wealth, and the executive director of the Private Giving Foundation. “I really like Charityfocus.ca from Imagine Canada, because it’s the same financial information as the Canada Revenue site, but it is user-friendly and easy to understand. You can research any of the 85,000 Canadian registered charities in one place.”
Marina Glogovac, president and CEO of CanadaHelps.org, agrees that online research is a good place to start; but that should just be the first step.
“Firstly, check to see if they are a registered charity and how their financial numbers look. After that there is a lot more you can do to decide if an organization is worth your time and money,” says Glogovac. “Try to see the charity in action. Visit or volunteer there, ask questions about their programs, is their work having an impact. People often give impulsively. Research shows that relatively few people do the leg work.”
A common mistake that even sophisticated clients make is favouring charities with the lowest ratios spent on administration, says Ryan. “Many donors want to put dollars toward program delivery and not into overhead, staff or technology. Charities can’t magically deliver programs with 0% overhead. We need them to be well-run, which means hiring good people – and you have to pay them.”
According to Bruce MacDonald, president and CEO of Imagine Canada, the most important thing to look at is the impact the charity has in their community. And fortunately, charities are getting better at demonstrating how they make a difference.
“We encourage Canadians to use a lens that is much broader than simply ‘how much does a charity spend on administration – overhead – fundraising?’” says MacDonald, “Folks should consider that real impact requires real investment. And while questions about financial performance are important, they should be packaged along with questions around what good does the organization do, and how effective are the programs that they are offering.”
Charities realize that they need to demonstrate the good work that they are doing to encourage donors to commit dollars, says MacDonald. And that information can be readily found by clients and advisors looking to help steer their clients in the right direction.
“People are interested in seeing their dollars have the highest impact,” he says.
Look in the coming weeks for more 10 Ways articles:
Things you need to know: donating appreciated assets to charity