• Fifty per cent of not-for-profit organisations globally report a decline in income over the past year, 33 cent saw an increase
• Not-for-profit organisations in Asia were hit hardest with an average income fall of 13 per cent, compared to an average decline in Europe of just one per cent
• Worldwide, fundraisers’ confidence is growing with 56 per cent reporting they feel more optimistic about donations in the coming 12 months
• Europeans are more pessimistic than any other region, with only 30 per cent feeling optimistic, compared to 70 per cent of Asians and Australasians

The past year has been tough for many and half of not-for-profit organisations report they have seen a decline in income. But a third (33 per cent) of fundraisers have successfully bucked the trend and generated additional income despite the recession, according to The Management Centre’s Global Fundraising Confidence Survey 2009.

Conducted by The Management Centre (=mc) from May-August 2009, the survey explores the views of 126 leading fundraising directors and sector experts from Europe, Asia, North America, Australasia and Africa about the impact of the financial crisis on the not-for-profit sector. The research report, (a follow-up to one conducted in 2008), highlights which organisations, causes and regions have and will be most affected and what strategies fundraisers should adopt to overcome economic instability. The survey also reveals how confident not-for-profit organisations are about the current fundraising landscape and the year ahead.

On average, income to not-for-profit organisations across the world fell by three per cent. Fifty per cent of not-for-profit organisations saw a drop in income over the past year and, of those, almost 20 per cent saw their income fall by more than ten per cent. However, 33 per cent of not-for-profit organisations saw an increase in income, and 14 per cent reported income growth of ten per cent or more. Not-for-profit organisations in Asia were hit hardest with an average income change of -13 per cent, while those in Europe reported a more modest change of minus-one per cent.

Even among those who saw their income fall or stay static, the majority (54%) were reluctant to blame the global recession as the sole factor, citing additional causes such as:

• Difficulties in recruiting good fundraisers
• Poor crisis leadership from other directors and the board
• Lack of effective strategy for dealing with the crisis

The most common factors reported to have positively impacted income levels were:

• Increased investment in fundraising and working harder to counteract anticipated income falls
• Finding new sources of income
• Major donors stepping in to boost income
• Innovation in fundraising to create new offerings

The research highlights the potential for success where fundraisers took a proactive approach in meeting the recession head on. When asked to indicate what broad strategy they had used for tackling the recession, more than half the respondents favoured ‘fighting for market share – expansion has been our key tactic’ (30%) or ‘taking effective action quickly to maintain donations’ (25%).

When asked what fundraisers should do to build income against the backdrop of a global recession, the most common recommendations were:

• Stay close to donors. Work with them to explain the situation for beneficiaries, but don’t put them under too much pressure
• Diversify and improve communication with donors. Get to know their needs better by improving research and databases. Make sure feedback is sought and treated seriously
• Apply a variety of fundraising approaches, don’t just stick to one. Linked to this was a desire to use social media more effectively
• Reduce costs through a range of measures from applying low cost fundraising methods to applying a pay freeze
• Be innovative – this covered a range of suggestions, including working closely with other similar organisations
• Looking ahead, fundraisers’ confidence is growing with more than half (56%) reporting that they feel more optimistic about the coming 12 months. Eleven per cent feel less optimistic, while the remaining third (33%) feel much the same. Europeans were by far the most pessimistic region, with just 30 per cent feeling optimistic about the coming year, compared to more than 70 per cent of Asians and Australasians.

Fundraisers predict that the three causes whose fundraising was most likely to suffer from the global financial crisis were arts, heritage and culture, science and scientific research and human rights. The three causes least likely to suffer were children’s causes, faith-based causes and education.

Bernard Ross, director of The Management Centre, said: “Fundraisers have been quick to adjust to the economic climate and our experience is that roughly a third of not-for-profit organisations are stepping up to the challenge of the recession and, as a result, becoming more effective and actually raising more income. In many cases, not-for-profit organisations report that donors are responding to increased need by increasing donations. But it’s not easy. Fundraisers are having to work harder and smarter to raise funds.

“Major donors and innovation are seen as drivers for better results. It’s also interesting to note that many see social media as playing a key role, although in my experience fundraisers are still uncertain about how to do this. But the most common advice from successful fundraisers was probably the best: ‘stay close to donors in as many different ways as you can’.”