The red-tape-covered word that can really get NPOs caught in sticky situations when not adhered to.
Okay.. no more puns, I promise.
But think about it, are you following compliance standards? If not (or you simply don't know) there's a chance you could find yourself in some hot water ... especially if you're running nation-wide fundraising campaigns.
Fear not. The better you understand something, the easier it is to stay protected. Here are the things you need to know...
I asked our friend Ify, from Harbor Compliance, to share her expertise on this topic.
Take it away.
We all know that donor relationships play a big role in the online fundraising formula for success.
Unfortunately, you can’t build deep-seated meaningful relationships with your donors if you don’t know them. How do they think? What may compel them to bring their friends and family into your fold? How can you build loyalty that ensures those first contributions become second, third, and ultimately, a lifetime of support? What do they value? Utilizing donor insights can help you find the answers, sure. But, have you thought about protecting that loyalty and trust?
The story always starts the same...
You research best practices for your online fundraising campaign. You map out a strategy that engages donors and makes the most of your relationships. You project how that strategy will boost annual giving and catalyze major gifts. You employ cultivation efforts that hone in on capturing the hearts, minds, and giving spirits of your donors so that they not only invest in your annual fund, but also make a multi-year commitments to your capital campaign. You talk about your mission and build the clarity on its delivery. All while maximizing cost-effectiveness and potential by doing it all online.
Wait, did you remember fundraising compliance?
Being compliant helps instill confidence in your donors so their focus stays on your mission. Successful campaigns need to be free of the pesky distraction of whether your organization is in good standing or not. Donors need to know that when they invest in your mission that its built on a solid foundation.
Online giving requires online fundraising compliance
There’s an excellent chance that your organization is incorporated in one of the 41 states that require charitable solicitation registration. It’s even more likely that you are engaging donors that live in one of those 41 states.
You’ve done an incredible job with your programming and have maximized the impact of each dollar raised. If you’ve built up your fundraising clout to a notable level (and I’m sure you have) then your donors will certainly be impressed. They are spreading the word about your impact every way they know how - posting on Twitter, Instagram, and Facebook. Your donors’ networks have become your network, spreading your message and expanding your outreach. They are forwarding your email solicitations and adding their own rousing endorsement. On top of that, you’ve made it easy for donors to give from wherever they are and online giving for your organization is on the rise. Online giving requires online fundraising compliance.
It’s not just about where you are; it’s about where you’re asking.
Are you casting a wide net, asking everyone you’ve connected with on your website and through social media to participate in your annual giving? Maybe some of your donors have moved away, but remain loyal givers. Have you made your Donate Now button prominent so that anyone, anywhere can find you and give? That “Donate Now” button is a solicitation. That means no matter what computer screen displays that button, you need to be compliant in the state it’s being accessed from.
Don’t trip over technicalities as the money comes rolling in. Register before you ask. When that generous donor sends you a gift - because Cousin Suzy talked about your work or Friend Joey sent them an email - that gift landed them in your pipeline, no matter where they live. You aren’t going to leave money on the table. You’re going to build the relationship and ask again… and now you’re soliciting. Determine if you’re soliciting in a state, and if so, make sure you're meeting all of the necessary requirements.
Don't you know where you’re soliciting? Your donor’s location is vital information. You want to know if they are living within one of the states you're compliant in or if they’ve crossed borders. Make sure that you’re in the know about your donor community by managing data well.
Having a donor prospecting and research tool can help you know where your donors are located and other information you need to capitalize on your fundraising database and bolster your campaign success. Strong systems paired with compliance will help you achieve highered returns with your online campaign.
Let’s keep it simple. There are four key steps to remember if you want to stay on track.
● Research: You need to know your status in each state. Once you know that, you can easily map out your path to compliance, including which applications to complete and what fees may be charged.
● Apply: Each state has it’s own application process, so make sure you are preparing the correct forms in the most streamlined and cost-effective manner.
● Monitor: As with any other submission you make, you’ll want to follow these applications through to approval, for your - and your donors - peace of mind.
● Renew: Mark your calendar so that once you’re compliant, you stay compliant. Track due dates and fees so that your renewals are on time and complete.
These are important, make sure you learn more about these best practices.
Your relationships with your donors are built on trust. Transparency and accountability preserve that trust. Solicitation triggers registration. Prioritize compliance! If you’re not in compliance, your run the risk of:
● Fines and penalties that pull vital dollars away from the work that you are doing in your community.
● Audits and enforcement actions that take your limited time away from the mission you’re meeting.
● Bad PR that can taint the reputation of your organization and follow you for years to come.
Instead, reap the benefits and rewards that come with knowing that you can:
● Fundraise anywhere at any time.
● Tap into the relationships and connections that you have invested time in building.
● Show the world of donors that you are a legitimate, credible organization, worthy of both their trust and their hard-earned dollars.
You want to be proactive while also honoring your valuable and desperately finite time. Take that good-faith step and invest in compliance.
More about the Author:
Ify Aduba is a Nonprofit Compliance Specialist for Harbor Compliance, a leading provider of compliance solutions for organizations of all types and sizes. Headquartered in Lancaster, Pennsylvania, Harbor Compliance partners with organizations in every state and over 25 countries abroad to help solve the most challenging compliance problems. With clients that range from the largest organizations in the country to fast-growth startups, Harbor Compliance fully manages government licensing compliance in both nonprofit and business sectors.
In her spare time, Ify actively volunteers within her community. She currently serves as President of the Board of the Pennsylvania Association of Nonprofit Organizations (PANO), President of the Administrative Ministries Team at Doylestown United Methodist Church, and Board member for the Bucks County Women’s Advocacy Coalition. She is also a member of the Doylestown Branch of the American Association of University Women and Doylestown Rotary.
About Harbor Compliance:
Harbor Compliance can help you with all of your fundraising compliance needs. As requirements become increasingly complex, they can present significant challenges to organizations of all types and sizes. Harbor Compliance wants you to achieve your mission and will ensure your fundraising compliance needs are met so that you can focus on strategies and success. Learn more about Harbor Compliance and how we can help you stay compliant in your fundraising.