Celebrity, Charity & Organizational Transparency

Celebrity, Charity & Organizational Transparency

Eva Longoria-backed “Philanthropreneurs” offer cautionary tale in donor relations

Recently, a high-level charitable kerfuffle has brought nonprofit star power in the limelight. And it’s dredging up questions and considerations about the interplay between celebrity-supported causes and their personal brands with organizations’ reputational credibility and donor confidence.

The Hollywood Reporter in February published an extensive expose charting the rise of two self-styled “philanthropreneurs” who happen to be friends of actress Eva Longoria.

Longoria, a well-known spokesperson and supporter of various social and charitable causes, lent her name and brand to the efforts of her friends’ Global Gift Galas, high-profile events designed to raise proceeds for philanthropic projects. An analysis and investigation by The Hollywood Reporter found Global Gift Galas’ claims of “100 percent” of donations funding charitable causes to be inaccurate. For example, when a live auction in Dubai raised $400,000 for “good causes,” a request for information by the publication surfaced more than $200,000 in unaccounted funds that, in fact, could not be verified as having been funneled to charities or nonprofit organizations.

The Hollywood Reporter neither found nor suggested any wrongdoing by Longoria, an established Hollywood power broker with a long roster of philanthropic efforts under her belt. But the findings raise a cautionary note to organizations about charitable transparency and donor relations, particularly when they leverage big names and celebrity profiles in raising funds and driving awareness.

The power of passion +the onus of personal responsibility

According to Vanessa Wakeman, CEO and founder of The Wakeman Agency, corralling celebrity endorsements and support poses no inherent risks for nonprofit organizations. However, a famous name alone should not be the only motivator for backers of particular causes or organizations.

“I am always excited to see celebrities use their influence for social change. However, I caution people to not get involved just because of a celebrity endorsement,” she says. “They should do the appropriate due diligence to make sure they understand how the nonprofit organization operates.”

People often become aligned with social change and special interest causes based on personal experience – perhaps being a cancer survivor or witnessing the environmental toll of pollution, for example. Emotionally and financially invested supporters whose trust is shaken due to misallocation or misrepresentation of funds – or even the suggestion or allegation of such – can be difficult to earn back.

“There is often a great deal of trust in these philanthropic relationships,” asserts Wakeman. “Nonprofits generally must provide specific measurements and analytics to show how corporate and foundation dollars are being used. Individual donors can check organizations’ reputations by visiting websites like Charity Navigator, which offers extensive details about nonprofits. [tweet bird=”yes”] It’s important for people to ask questions and be an active donor beyond just writing a check.” [/tweet]

How organizations can stay above board

Wakeman says that [tweet bird=”yes”] the best way for organizations to instill trust and maintain the confidence of their donors is through this one word: transparency. [/tweet] But transparency means more than just the willingness to be an open book; it requires a deliberate and ongoing approach to accountability and information sharing.

Be responsive. If accusations or assertions about financial misuse arise, organizations must readily respond. Delays or lapses in communication – or worse, the absence of any message at all – can erode donor and supporter confidence quickly. The more time an organization fails to address such charges of fund misappropriation, the more opportunity arises for speculation, conjecture and hearsay, even by the most well-intentioned individuals.

Prove it. Beyond broadcasting how much money was raised through a particular campaign or effort, organizations can further leverage their credibility by drilling into the details. Providing actual measurements that illustrate the impact of funds raised can better qualify to donors exactly how those funds have been applied. Organizations can provide actual calculations rather than approximations or estimates, or furnish quantifiable examples (i.e. “Each dollar raised provides one new book for a classroom serving up to 15 disadvantaged students.”)

Stay plugged in. Be connected with donors continuously. Share good news. Provide organizational updates. Being proactively informative can boost charitable giving in addition to strengthening engagement. According to The Chronicle of Philanthropy’s “What Donors Want – but Often Don’t Get“, many donors admitted they could give more money but refrained from doing so due to lack of general information and feedback about expenditures.

Which tactics does your organization employ to stay connected with donors? How do you sustain confidence about how funds are managed?

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