Living and Giving

Five Reasons Nonprofits Don\’t Receive Matching Gifts (And What To Do About It), Part One

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We\’re excited to announce our Founder  and CEO Pamela Hawley was just featured in Forbes publication! The article is entitled Five Reasons Nonprofits Don\’t Receive Matching Gifts (And What To Do About It), and was published on April 29, 2019. Please see below!

 

 

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Did you know that employees can recommend a donation to your organization? It’s called \”matching gifts,\” where the employer matches the employee’s donation request. And more than $5 billion is given each year through workplace giving programs such as this.

Started in 1954, matching gifts is a program held by corporations that love to help employees give back. This program allows the employee to nominate a nonprofit to which they would like to donate. Once the employee gives money — let\’s say $125 — then the foundation of the company matches the donation. Would you be excited if you were a nonprofit that received $250? You bet!

But did you know that many nonprofits don’t receive the grants they’re given? Anywhere from $4 billion to $7 billion in matching gifts goes unclaimed.

This money goes undonated because every year there are employees who don\’t nominate a nonprofit and so the company doesn\’t match. So, for all you nonprofits that have board members or colleagues at various companies, be sure you leverage the double giving and encourage them to nominate you for a matching gift.

 

 

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But let’s examine another scenario that is important to nonprofits: when employees do nominate you, and the nonprofit doesn’t accept. Why is this?

Let’s review five reasons nonprofits don’t receive a matching gift. You can take these lessons and apply them to the nonprofit you work for or help a nonprofit that you nominate. In the end, we all want to do good, and we all want to see nonprofits receive their funds.

1. Missing The Right Documents

When you are nominated for a grant from a foundation, they need to receive certain paperwork from you. This might include your mission statement, your 501(c)(3) status, your overhead calculation and more. At UniversalGiving, we have more than 24 stages that we have created for vetting an NGO. It\’s called our \”Quality Model\” and is why we are unique. We allow our corporate clients to customize which vetting steps they apply for their corporate social responsibility programs.

Some nonprofits don’t receive a grant simply because they can’t find the paperwork, while other nonprofits don\’t make the effort to find the paperwork. And if you can’t submit the necessary documentation, then you lose the grant.

2. High Overhead

Proper governance is a key factor in evaluating a nonprofit, and proper governance requires fiscal responsibility. That means that anyone who’s donated to you wants to know that the funds are being used wisely. Normally, an overhead between 10% and 12% is expected for top-rated nonprofits; truly great nonprofits are closer to 10%. A nonprofit can have an overhead of up to 25% to 35% in certain circumstances. It’s important to have a guideline, but also some flexibility.

If you don’t have the overhead according to the corporate guidelines, my biggest recommendation would be to share your plans for reducing overhead. If the corporate client sees that you are making a concerted effort to do so, they may still approve the grant.

 

 

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While overhead is just one component of approval, it’s an important one. Fiscal responsibility and the proper use of each dollar is of the utmost importance in a donor’s mind, whether it’s the employee nominator or the corporate foundation who matches.

 

Stay tuned for Part Two of Five Reasons Nonprofits Don\’t Receive Matching Gifts (And What To Do About It) tomorrow!