Give up on the Unicorn! 5 Fundraising Myths for Arts and Culture…

Bernard Ross, =mc & National Arts Fundraising School Director and fundraising expert speaks out on 5 fundraising myths in arts & culture that you need to address…

Here’s a challenging graph. With some challenging information. And challenging implications.

Grant in aid arts funding since 2015

The question is, what do we do about the loss of public support since it’s unlikely that this situation will change? And the answer is, of course, ‘private support for the arts.’ But is it really that simple? Or easy?

One of the (many) difficulties facing fundraisers – especially in the arts, culture and museum sector – is the number of myths round raising money from private sources, and even where the money is. The result is that talented and committed fundraisers, who could be doing amazingly well, spend significant time and energy chasing ‘unicorns’ – mythical and mystical opportunities that, to be honest, [spoiler alert] simply don’t exist.

unicorns are dead

Don’t get me wrong. Most of the myths are put out by people who are well intentioned. Some are passed on by neophyte consultants. But the key issue here is that lots of commentators and/or policymakers setting the arts fundraising agenda actually don’t know a lot about fundraising. Or they solely inhabit the relatively small world of arts and cultural fundraising, which itself can be buoyed – and even distorted – by institutional funding from ACE, or the lottery funds. These ‘mythmakers’ are reluctant or unable to learn from the larger world of charity fundraising. As someone who works as a professional fundraiser and consultant not only across the arts and culture field, but also with almost all of the top UK charities, I think it’s time to stop chasing these fairytale unicorns, and wake up and smell the cash caffeine.

Myth 1 is below the other four will follow, one a day til Friday.

(And, as it happens, these are 5 myths that the National Arts Fundraising School will bust and help you to move on from.)

 

Myth No 1: Corporate charity will come to the rescue

If you read the financial papers or listen to the news you’ll know that many businesses, despite Brexit, are doing well. So, the argument goes, private business[1] will use some of this success to support arts and culture in a way that will help make it sustainable. All perfectly reasonable in a unicorn-filled world. I’m constantly hearing about boards ‘blaming’ their fundraisers for failing to bring in the big commercial sponsorship or CSR “that others are getting.”

And some arts organisations are guilty of stoking the mythology by, for example, running a “Yah boo we got massive corporate support” PR campaign. Try finding out, for example, how much specific businesses are actually paying towards sponsorship of Hull City of Culture – beyond the modest £17K each put in by 22 initial businesses. (Note, too, that money only actually went in when they had won the award.) Have they really raised £32M in cash with significant amounts from the private sector? Or are there a lot of ‘value of gifts in kind’ in there? Plus, huge amounts of public subsidy? To be clear, I’m not saying Hull 2017 isn’t a great thing. Just my guess is the cash is not remotely as much as is being suggested.

Super heroes

You might still want to argue “it sounds great for the arts.” But that ‘amazing’ figure makes target setting for the current aspiring cities of culture a bit difficult to put it mildly. I speak as someone who was heavily involved in the Paisley CoC21 bid and faced a lot of pressure to identify similar corporate sources at scale. Unfortunately the unicorn had left the building.

Meanwhile, in the wider charity world, the reality is that according to the Charities Aid Foundation giving by companies in the FTSE 100 to all charities[2] declined by 17 per cent in 2014, compared to 2013. (These are the latest reliable figures[3].) Forty companies reduced their donations by a combined total of £450m between 2013 and 2014, with just six companies accounting for more than 75% of this fall. Forty-two companies increased their giving, but by a much smaller total of £43m. And the percentages of profits deployed – from the largest and most profitable companies in the land – are pretty small[4].

At the other end of the scale it’s not much better. Our own research, based on our analysis of the 1,400 agencies and individuals who have attended the National Arts Fundraising School, suggests that the average contribution from an SME to any specific arts and culture appeal has stayed steady at around £500 for a decade. Small beer. There just isn’t a lot of investment in the arts and culture by business. And, as at least some of you will know, companies want a lot for any investment they do make.

It’s not all the capitalism’s fault. Many businesses are now questioning the value of charitable giving full stop in terms of advancing business interests – and instead prefer to focus their Corporate Social Responsibility on issues like reducing their climate impact, or running their own charitable projects directly, or (more cynically) putting a lot of money into appearing ‘socially responsible’ through PR. (Just look at recent moves by major supermarkets like Sainsbury to pull out of Fairtrade – a demanding but fair and ethical standard – and use their own less rigorous standard.)

The learning from the unicorn’s sad demise? By all means seek corporate support, but recognise that even the largest and most-attractive-to-corporates of charitable causes like UNICEF (what’s not to love about saving children?) only get 6% of their income from business. Corporate support, even at a small level, adds value to your brand, and may make you as a fundraiser look good. However, at current levels, it remains a pretty but moribund unicorn from a sustainability point of view.

What’s next?

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[1] According to the FT it dropped by £450M in 2014. https://www.civilsociety.co.uk/news/report—corporate-giving-by-the-ftse-100-.html

[2] The headline figure for charitable investments is £2.1B. But of course this figure is self calculated by companies and includes their estimate of the ‘value’ of services like gifts in kind, charged for volunteer time, etc. So if a senior company manager attends a board meeting, it’s internally costed at up to £2,000 – the notional price of a high powered commercial consultant attending the meeting. Note also that since a change in legislation in 2013, a total of 13 FTSE 100 companies have chosen not to specify their corporate donations for one or both financial years. As such, their contributions, if they made any, could not be included in this year’s report. These 13 companies collectively donated £17.2m (or 0.7% of the £2.4bn total) to charitable causes in 2012, the last financial year in which reporting corporate donations was mandatory. https://www.civilsociety.co.uk/news/report—corporate-giving-by-the-ftse-100-.html

[3] The way in which CSR is calculated is pretty arcane and impenetrable – and designed to flatter the company contribution. And since 2012 companies are not legally obliged to report on any gifts they do or don’t give to charity.

[4] According to the most recent Financial Times report FTSE 100 companies donated an average of 1.9 per cent of pre-tax profits and 0.25 per cent of revenues in 2014, and more than a quarter donated at least 1 per cent of pre-tax profits, up from 22 in 2012. Forty donated less than 0.5 per cent and 13 donated less than a tenth of 1 per cent

 

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