The Problem With Donor Recognition

The late Hank Rosso, founder of the Fund Raising School that now has international roots through Indiana University, stated that "one of the chief fundraising officer's roles is that of a teacher."

That said, I am constantly doing research on various topics related to our field of service. All of us work very hard to research, cultivate, solicit and steward donors. As part of the teaching and learning process, continual knowledge of how we recognize donors must come into play.

Donors are recognized in many forms from handwritten thank-you notes to names on buildings. As the recognition level increases in permanence, the stakes are higher for potential problems. I was surprised that I had to open five books on the subject of recognition before I found a specific section on this important topic.

I opened the Indianapolis paper this week and, to my surprise, saw a front-page article that gave me pause. The headline was "Purdue donor set to sue over 'God.'" A donor in good faith made a multiyear pledge in honor of his parents. The university asked the donor to create words for a plaque to be placed outside a dedicated conference room. The university ultimately rejected the plaque and gift due to the usage of the word "God" in a public facility. There is now possible litigation and a potential long-term relationship between a donor and university that has now turned sour. All of the good will that was created in this case has resulted in a public relations mess.

The point of my story is not to debate that specific issue. The point is there are problems seen and unseen with recognition of donors and the institutions that are recipients of funds. Problems with naming recognition come in many forms.

Here are a few examples of recognition problems that I have seen in my career:

• A wealthy couple divorced, and the man wanted his wife's name taken off every plaque.
• After the building naming was finished, the businessman's reputation was called into question.
• A naming of multiple rooms took place, but then the donor decided not to honor the balance of his significant pledge.
• When someone passed with a specific bequest and after naming was completed, the family challenged the gift, and an innocent gift was turned into a negative scenario.
• A million-dollar donor with named facilities over time lost track of giving. She brought her finance representatives to meetings challenging the rate of return of her subsequent endowment donation, and the donor/institutional relationship was never the same.
• I experienced the ethical problem of renovation of various named buildings. Do you keep the original donors' names and plaques while you are seeking new named donors for the same area or simply move on and place the old plaques in storage, not informing the donors who gave years earlier about the institutional renovation plans?
• I created a gift club at the $10,000-plus level that stated plaque recognition would be permanent. After I left the institution, the person who replaced me eventually eliminated that gift club. How would you feel if you looked for your plaque that disappeared one day without notice?

Recognition at the highest levels is not just an issue involving the chief development officer. Administration, staff, volunteers, board members and others play a role in this process.

Unfortunately, many not-for-profits do not have written guidelines for recognition. This is a must to avoid potential problems. As part of your solicitation scenario, be fully prepared to discuss recognition options, and make sure you have your ducks in a row at the time the gift is made. Your ultimate goal is to keep everyone happy — which may lead to larger gifts. This is not easy, especially if you inherit a donor relationship formed by someone else. No one said our job is easy except those who have never been in our shoes.