Giving Australia - Summary of Findings
Table of Contents
- Executive Summary
- The givers
- The recipients of giving
- Strengthening giving
Giving Australia has been a large, multifaceted research effort spanning almost eighteen months. Through the completion of surveys and participation in interviews and group discussions, more than 10,000 people have contributed to the information presented in this report. In addition to key researchers, management and administration personnel acknowledged below, the project has also beneﬁted from input ranging from senior representatives from peak national bodies through to volunteers. Each is acknowledged here with many thanks.
Professor Mark Lyons of the University of Technology, Sydney Centre for Australian Community Organisations and Management (CACOM) has contributed much to Australian research on the nonproﬁt sector and this continued through this project, his contribution being pivotal to two key components—the Individual and Household Survey and the Survey of Nonproﬁt Organisations. In the former task he was assisted by Mr Andrew Passey (data analysis and assisting with report writing) and in the latter by Dr Gianni Zappalà, Orfeus Research (survey design, analysis and report writing) as well as Ian Nivison-Smith (database analysis).
Dr Kym Madden and Dr Wendy Scaife of Queensland University of Technology Centre of Philanthropy and Nonproﬁt Studies (CPNS) were the key researchers responsible for the organisation, conduct and analysis of focus groups and in-depth interviews, as well as expert panel discussions, in support of the project. They were supported by Professor Myles McGregor-Lowndes, the Director of CPNS, who also provided advice on taxation data and law in relation to nonproﬁt organisations.
Ian McNair and Matt Balogh, McNair Ingenuity Research Pty Ltd conducted the Survey of Business, a major and complex undertaking.
Andrea Douglas, Chris Lonergan and Clare McAdam of Roy Morgan Research were central to the conduct of the Individual and Household Survey.
Dr Sue-Anne Wallace, Fundraising Institute – Australia (FIA) provided important direction for the design of the Survey of Nonproﬁt Organisations, and facilitated distribution and completion by members of the FIA.
Amro Abdelkarim, Australian Council of Social Service (ACOSS) designed the online survey and database for the Survey of Nonproﬁt Organisations and assisted with some combined database calculations for this report while Margaret Mudgeway, also of ACOSS provided administrative support to the project. Petrina Slaytor, a volunteer at ACOSS , Phillip Orr and Les Marsden assisted with the coordination of the the Survey of Nonproﬁt Organisations, distribution and database compilation as well as coordinating volunteers provided to the project through the welcome services of Volunteering NSW.
Giving Australia was fortunate to beneﬁt from the input of a number of leaders across the business and nonproﬁt sectors through a Project Reference Group that met at the start and toward the end of the project. These members included: Robert Fitzgerald (Chair), National Non-proﬁt Roundtable; Sha Cordingley, Volunteering Australia; Ken Baker, ACROD; Duncan Power, Charities Aid Foundation Australia; Richard Milroy, Givewell; Mary Nicolson, Australian Chamber of Commerce and Industry; Ben Ferguson, Business Council of Australia; Narelle Kennedy, Australian Business Foundation; Michael Liffman, Asia Paciﬁc Centre for Philanthropy and Social Investment, Swinburne Institute of Technology; Ruth Phillips, School of Social Work & Policy Studies, University of Sydney; Andrew McCallum, Australian Council of Social Service; Andrew Johnson, Australian Council of Social Service; Peter Kaldor, Christian Research Association; Elizabeth Cham, Philanthropy Australia; Tamara Winikoff, Artspeak; Alan Coates, Cancer Council of Australia; Graham Tupper, Australian Council for International Development; Cath Smith, Victorian Council of Social Service; Sarah Lucas, Confederation of Australian Sport; Professor Adrian Sargeant, Visiting Fellow, Queensland University of Technology, Centre of Philanthropy and Nonproﬁt Studies.
Members of the secretariat to the Prime Minister’s Community Business Partnership in the Department of Family and Community Services (FaCS), including Glennys Purcell, Ruth Richardson, Julianne Bradley and Susan Woolias, provided overall project direction and contributions to methodology, assistance with meeting various requirements of government and assistance with publications and communications generally. Support was also provided by Clem Tozer of the Australian Bureau of Statistics in his role on the project’s Steering Committee convened by FaCS.
Day to day the project was managed by the ACOSS Deputy Director, Philip O’Donoghue, who was responsible for coordination of research, writing and editing of this and other reports based on the work of researchers, as well as input into questionnaire design for the various surveys.
Giving Australia has identiﬁed a growing proportion or rate of giving and increasing generosity in giving. This holds true for giving of money, and giving of time or volunteering and across giving by individuals and households as well as by business.
The giving of money, goods and services to nonproﬁt organisations by individuals and business is estimated by this research to total $11 billion in a year (this ﬁgure excludes giving in response to the Asian Tsunami appeals in late 2004-early 2005). This giving is comprised of:
- $7.7 billion from individuals. Of this, $5.7 billion was donated by 13.4 million people, 87% of adult Australians, in the year to January 2005. The average donation was $424 per year while the median donation was $100 (i.e. half of all donations were above this amount and half were below). A further $2 billion was provided by 10.5 million individuals through ‘charity gambling’1 or support for events.
- $3.3 billion from 525,900 businesses, 67% of all businesses in the 2003-04 ﬁnancial year. Business giving consisted of 68% in money ($2.21 billion), 16% in goods ($0.52 billion) and 16% in services ($0.52 billion). Donations accounted for 58% of business giving ($1.9 billion – given by 58% of all businesses); sponsorship for 25% ($0.81 billion – given by 20%); and community business projects2 for 17% ($0.54 billion – given by 19% of businesses).
Giving of time by individuals, volunteering to nonproﬁt organisations, is also very signiﬁcant. Key ﬁndings are:
- Of adult Australians, 41% volunteered in the year to January 2005 giving an estimated 836 million hours of their time at an average of 132 hours per year per volunteer. The median for volunteering hours was 44, half volunteering more and half less than this amount.
Nonproﬁt organisations: The recipients of giving
There are an estimated 700,000 nonproﬁt organisations in Australia, most of which are small and many depend on voluntary commitment. About half are incorporated and about 35,000 employ staff. There are approximately 20,000 organisations with Deductible Gift Recipient3 status in Australia. For 1999-2000 the Australian Bureau of Statistics (ABS) (2002a) estimated the nonproﬁt sector’s total revenue at $33.5 billion.
Key features of giving to different ﬁelds within which nonproﬁt organisations operate include:
- Community and welfare service organisations receive about one in eight of all dollars donated by adult Australians. This sector receives over one-quarter of all hours volunteered and attracts 30% of business giving.
- Health nonproﬁt organisations, including medical research organisations, receive about one in six of all dollars donated by individuals, one in ten of all hours volunteered and almost 20% of the total value of business giving.
- Religious institutions are signiﬁcant beneﬁciaries of donations by individuals, receiving more than one in three of total dollars. About one in six of all hours volunteered goes toward these institutions.
- International aid and development organisations receive about one in eight of all dollars donated by individuals. This does not include total giving of more than $300 million through Tsunami appeals in 2005.
- Education nonproﬁt organisations receive about one in twenty of all dollars donated by individuals and business. These organisations receive about one in eight of all hours volunteered.
- Environment and animal welfare groups receive about one in twenty of all dollars donated by individuals, about one in forty of total hours volunteered and less than 1% of the total giving from business.
- Sporting and recreation groups receive 3% of the total of all individual donations, about one in ﬁve of all hours volunteered and one in six of the dollar value of business giving.
- Arts and cultural organisations receive only a small proportion of individual donations and volunteered hours but receive almost one in ten of all dollars donated by business.
Comparisons over time must be qualiﬁed, given that different methodologies applied, and so should be treated with caution. However, because a number of data sources have conﬁrmed growing rates or proportions of donations of money and volunteering by individuals, there can be some conﬁdence in the comparisons with earlier ABS ﬁndings.
Since 1997, giving of money by individuals has increased in absolute terms by about 88%, or 12.5% per year. In real terms, adjusted for inﬂation, giving rose by about 58% over those seven years.
The proportion of Australians who volunteer is rising. In 1995 the ABS (2003) estimated the volunteering rate to be 24% and total hours volunteered, 512 million. The average number of hours volunteered by each volunteer was 160 per year. In 2000 the ﬁgures were a volunteering rate of 31%, a total of 704 million hours and an average number of hours per volunteer of 160 per year. By 2002 the rate had increased to 34% (no estimates of hours were provided).
For the 2000-01 year the ABS (2002b) estimated total giving by business as $1.5 billion. As a result of methodological differences between that study and ﬁndings reported here, it is not possible to be deﬁnitive about the extent of growth in business giving, which has nevertheless been signiﬁcant. Comparisons of the proportions for giving via donations, sponsorships or community business projects can be made with somewhat more conﬁdence. Between the 2000-01 and 2003-04 years, the proportion of business giving through donations rose from 40.5% to 58%, community business projects have risen from 12.6% to 17% while sponsorships have fallen as a proportion of business giving from 46.7% to 25%.
Comparing giving in Australia with the USA in 2004 we ﬁnd that giving as a proportion of Gross Domestic Product (GDP) in the USA is 1.6% and for Australia it is 0.68%. In Canada, for 2000, donations were equivalent to 0.46 % of GDP. This indicates that when the differences in the size of economies is taken into account, the USA generates more than twice the level of giving than Australia, and Australians give about one and a half times as much as Canadians on average.
According to a large sample survey conducted in 2003 by the United States Department of Labor, 27.6% of Americans aged 16 and over volunteered during the twelve months to September 2002 (United States Department of Labor 2002). The median number of hours volunteered was 52 per year. A signiﬁcantly higher proportion of Australians volunteered, but with slightly lower median hours than Americans.
In 2000, 27% of Canadians over 15 volunteered for a total of 1050 million hours, or an average of 163 hours per volunteer (Hall et al 2001). The rate has decreased since 1997, though the average hours volunteered has increased. It can be seen that a signiﬁcantly higher percentage of adult Australians volunteer, but for fewer hours on average than Canadian volunteers.
This overall increase in giving is likely to be the result of a number of factors. These include:
- the increasing size of the adult population in Australia
- sustained economic prosperity, with increasing numbers in employment and, for most, rising wages and disposable income for individuals and, generally, improved business proﬁtability
- increases may also reﬂect greater and positive publicity for giving, a large increase in the number of nonproﬁt organisations seeking donations and the use of more sophisticated appeals and fundraising methods by some.
Drawing on the quantitative and qualitative research on giving, it is possible to identify some factors, and for these, some relationships or patterns. Such a summary is necessarily qualiﬁed by the observation that giving is diverse, taking many forms and performing different purposes. However, such a summary can provide a guide to understanding and identifying strategies for strengthening a giving culture in Australia.
Giving is inﬂuenced by the capacity of individuals and businesses to give, either ﬁnancial or non-ﬁnancial resources.
Giving can also be viewed as occurring along a continuum from altruism – with no expectation of return – through to giving that entails reciprocity of either implicit, explicit, more or less tangible returns to the giver.
The discussion of this research related to these factors is summarised below.
Two relationships seem evident about the inﬂuence of the capacity of givers. These are:
Those with greater ﬁnancial capacity give more. Wealthier individuals and larger businesses tend to give more, and more often.
Those with less capacity give what they can. Cash-poor individuals (eg retirees, younger people and, comparatively, women) volunteer at higher rates and/or for longer periods on average than do time-poor, wealthier individuals. Larger businesses give all forms of assistance to nonproﬁt organisations more often on average than smaller businesses. However, very small businesses have been found to more often give some speciﬁc forms of goods and services compared with larger businesses, also suggesting this ‘give what you can’ approach.
Altruism and Reciprocity
Giving can be viewed as occurring along a continuum from, at one end, giving that is altruistic, through to giving that is reciprocated through returns to the giver. A number of points along this continuum can also be identiﬁed.
Altruistic giving. This is the most common reason popularly associated with giving and the one that many view as being primary. Giving to the Tsunami appeals of late 2004 and early 2005 is a good example. Such giving is often spontaneous or unplanned, for example as a reaction to a catastrophic event or an unexpected encounter, such as giving to street collectors or beggars. Altruistic giving is often anonymous and frequently no return to the giver is sought or expected, amounts given can be modest and only rarely are claims for tax purposes made.
Expression of identity or reputation. For individuals, giving can reinforce, or be a manifestation or expression of religious, social justice, environmental, aesthetic or other values. The return to the individual is often intangible, in the form of feelings. Tokens, such as badges or a ﬂower can be symbolic for the giver but are usually of little material value. Social and other relationships can be important as factors reinforcing such values. In the case of businesses, giving may enhance the reputation of a business.
Community connectedness. The extent to which individuals or businesses are connected with communities seems to be a factor in giving. Individuals who are volunteers with or members (especially active members) of nonproﬁt organisations, give more than those who do not join in such community activity. Those who have used the services of nonproﬁt organisations also tend to give more and give more often. Individuals who have beneﬁted most from the community – through, for example, higher education or high incomes – tend to give more and at greater rates. Business, especially smaller businesses in regional areas, often give to local causes. Many businesspeople and wealthier individuals respond well to requests for giving that are initiated by people within their networks or that involve those networks.
Reciprocity. In a number of ways individual givers may receive a material beneﬁt for giving – this can range from fundraising dinners to more enduring items (such as T-shirts). The possibility of material gain can be extended through ‘charity gambling’. For business, giving to nonproﬁt organisations may result in proﬁle or advertising and attract or retain customers (eg via sponsorship). Business may attract staff or improve staff retention rates or skills through employee volunteering or giving programs.
The reasons or motivations for giving, in practice, often reﬂect a mix of factors. Understanding these reasons can lead to better ways to strengthen giving and nonproﬁt organisations.
Sustaining giving is most likely when an understanding of motivations for giving are built upon by mechanisms that foster planned giving. A commonly held view is that giving is spontaneous. Indeed ﬁndings here are that 51% of donations are one-off, but often quite small. However, nonproﬁt organisations are most likely to be sustained by regular and generous giving built on a long term relationship with the giver.
Bequests and the role of foundations and trusts are among the infrastructure of planned giving. These entities are also often strategic by being sustained and supportive in addressing systemic problems and meeting gaps in community need.
Taxation measures also foster planned giving. While only about one in four dollars donated is claimed for tax purposes, those who respond to tax related giving incentives are often wealthier community members, whose rates and magnitude of donations are growing. Prescribed private funds, while still small in number, have grown quickly to become signiﬁcant. A capacity for growth is evident for workplace giving. Workplace giving is a simple and effective way to regularly donate to charitable organisations through automated payroll deductions.
The approaches that nonproﬁt organisations adopt to secure giving are important. Some frequently used approaches, such as telemarketing, are found to be unpopular, but reasonably effective. However, these and other invasive approaches, and the overall credibility of nonproﬁt organisations through their adoption, pose risks to giving. Donors report a preference for door knock appeals, especially when undertaken by volunteers and when publicised. Businesses have a preference for, and do respond fairly well to, written requests supported by documentation.
Findings from the Survey of Nonproﬁt Organisations conﬁrm that fundraising and volunteering are the two most widely adopted ways of generating resources. However, the use of particular practices varies, often based on the size of nonproﬁt organisations. Smaller organisations rely more heavily than larger ones on volunteers and charity gambling activities such as rafﬂes and generally use a smaller array of strategies. These smaller organisations often lack both the resources to diversify their activities for generating resources and the knowledge to do so. Larger nonproﬁt organisations engage more often in a full array of fundraising activities, support from volunteers, commercial ventures and partnerships with business. However, even with experience larger organisations face constraints, especially ﬁnancial and human resource limits, in particular attracting, retaining and training good fundraisers. As with any organisation, leadership at a CEO level is important and, as a deﬁning characteristic of the nonproﬁt sector, voluntary board members providing good advice, support and contacts are a factor in success.
Finally, nonproﬁt personnel have had input to this project through participation in focus groups and in-depth interviews. A range of issues have been raised including concern about the reputation of the nonproﬁt sector, relations with government and the need for a sound legislative environment that helps in the management of risk and the construction of community conﬁdence through practical methods for transparency and accountability.
Many nonproﬁt organisations recognise the opportunities that giving from volunteers, donors, business and foundations or trusts can provide, but there is often a sense that choosing among these possibilities, while facing day to day challenges, can be overwhelming. Sound research complemented by collaboration between government, business and nonproﬁt sectors should provide a framework for further development.
- ‘Charity gambling’ includes fundraising through rafﬂes, lotteries and art unions.
- Community business projects are deﬁned as including cooperative arrangements or partnerships between business and community or government organisations that involve an exchange of money, goods or services in return for business beneﬁts such as improved staff expertise, networking or enhanced reputation.
- Deductible Gift Recipient (DGR) status is conferred under taxation law to nonproﬁt entities. An individual or business making a donation to a DGR entity may make a tax deductible claim for such a donation.
Research on individual and business giving in Australia is not substantial.4 This project has sought to improve our understanding of giving and has been unique in a number of ways.
This work has generated substantial quantitative data on both the giving of money and volunteering, allowing for a comprehensive exploration of these key factors not previously available through a single survey and data set. A Survey of Business has built upon an earlier Australian Bureau of Statistics (ABS) (ABS, 2002b) Business Generosity Survey in 2000-01. This has allowed, for the ﬁrst time, for some trends in business giving to be identiﬁed. A Survey of Nonproﬁt Organisations has provided a unique source of information on how resources for this sector are being used and what might help nonproﬁt organisations to strengthen their capacity through additional ﬁnancial and volunteer support.
Research has melded both quantitative and qualitative methods and helped to ensure a powerful and practical outpouring of information for use by public and corporate policy makers, nonproﬁt organisations and researchers.
The Australian Government Department of Family and Community Services (FaCS), on behalf of the Prime Minister’s Community Business Partnership, has commissioned this research. Giving Australia is a collaboration formed to meet the challenges posed by this research.
This program of research, coordinated by the Australian Council of Social Service (ACOSS), has involved several key activities. Substantial reports for each of the research components will be published in due course, and the ﬁndings of these have formed the basis of this report. These activities and the principal research agencies included:
- Individual and Household Survey. This has involved a national household survey, conducted over February and March 2005 and using a 20 minute telephone interview of 6,209 respondents representative of the Australian population. A range of questions on individual and household giving and volunteering was completed. The research team from the University of Technology, Sydney, Centre for Australian Community Organisations and Management (CACOM) has guided survey development and analysis with Roy Morgan Research having undertaken the survey work.
- Business Community Involvement Survey. This national survey secured responses from a representative sample of 2,705 businesses across Australia and collected data on donations, sponsorship and community projects during the 2003-04 year. It was conducted over the period March to May 2005. This survey was undertaken by McNair Ingenuity Research.
- Survey of Nonproﬁt Organisations and Fundraisers. This survey was undertaken to assess the fundraising and development capacity of nonproﬁt organisations in Australia, the resources and supports available and their uptake. A total of 481 surveys were completed from a range of nonproﬁt organisations. This survey was developed by the University of Technology, Sydney CACOM team with support and input from ACOSS and the Fundraising Institute – Australia. CACOM, together with Orfeus Research conducted the analysis of ﬁndings from this survey.
- Focus Groups, In-depth Interviews and Expert Panels. As part of this research 34 focus group discussions and 38 in-depth interviews were held across a range of businesses, nonproﬁt organisations, and individual donors. Towards the end of the project, panels of experts in philanthropy were convened to contribute towards analysis of research ﬁndings through an examination/reﬁnement of the themes. These components have been undertaken by the Queensland University of Technology Centre of Philanthropy and Nonproﬁt Studies (CPNS).
Outline of report
The aim of this report is to summarise ﬁndings. In general, the aim of the research has been to examine the state of giving to nonproﬁt organisations of money and time (volunteering) by individuals, households and businesses in Australia.
In this report, a great deal of data has been omitted in an effort to contain length and give focus to key ﬁndings. Following the release of this summary report, full reports on each research component will be available on the website of the Prime Minister’s Community Business Partnership
The key sections of this paper are as follows:
- 2.0 Methodology. Provides a brief summary of key methodological issues, allowing readers to be informed of the strengths and limits of research ﬁndings.
- 3.0 The givers. Summarises the characteristics of those that give, both individuals and business.
- 4.0 The recipients of giving. Summarises the patterns of giving to nonproﬁt recipients as well as the strategies used by nonproﬁt organisations to enhance their resources through fundraising from individuals and business as well as involvement from volunteers.
- 5.0 Strengthening giving. Summarises ﬁndings regarding reasons for giving, planned giving (including bequests and foundations and taxation measures), and discusses approaches applied by nonproﬁt organisations to secure ﬁnancial and volunteer support. Findings are discussed regarding resources and issues for strengthening nonproﬁt organisations.
- Summary of earlier research available from either http://coss.net.au/ .
The sections below outline the key methodological characteristics of each major research activity undertaken as part of this project. Sufﬁcient detail is provided to allow the reader to understand the strengths and limits of the data that result from this work. The full reports that will follow the release of this paper will provide further methodological details.
Individual and Household Survey
This survey was designed primarily to collect data on:
- the giving of money and of time (volunteering) by adult Australians, especially the levels of giving and the destinations of those gifts
- people’s reasons for giving money or for not giving money
- people’s experience of different forms of fundraising and their attitudes towards these
- demographic characteristics of respondents, including their afﬁliations that are relevant to giving
- the impact of government policy designed to encourage monetary giving, such as tax deductions for gifts.
The survey was designed with a view to ensuring comparability with earlier research, though the method of administration (by computer aided telephone interviewing) and the period of recall (one year) meant that in some important respects the survey differed from a 1997 survey of giving by the ABS which used face to face interviews and a three month period of recall for most data.
In order to explore people’s reasons for giving, each respondent who reported giving to at least one organisation during the preceding twelve months was asked a series of questions about one particular gift.
Data collection was undertaken from February to March 2005. It is relevant to note that the Tsunami on Boxing Day 2004, and the associated media coverage and appeals by overseas development nonproﬁt organisations, and the generous response by many individuals and businesses, gave extraordinary prominence to, and positive endorsement for charitable giving. This created two problems for the survey. It meant that the huge one-off outpouring of giving (estimated in March 2005 by the Australian Council for International Development (ACFID) at $300 million) would lift the level of giving for the preceding twelve months above the underlying or structural level. As well, the positive endorsement of giving might encourage a more accurate recall, but it might also lead some respondents to invent or to exaggerate their level of giving.
In an attempt to address the ﬁrst problem the questionnaire was altered slightly. The Tsunami appeal was mentioned in the introductory remarks and respondents were told that they would be later asked about their response to that, but for the moment they were asked to think about their non-Tsunami giving over the previous twelve months. However, it is nonetheless possible that some respondents may have exaggerated the level of their giving due to their response to the Tsunami appeals (a ‘halo effect’).
Contact was made with a random sample of households, where one-third was selected from high-income census collection districts to ensure that high-income earning households were well represented in the sample. A total of 6,209 interviews were completed. This represented a useable response rate of 40%, which is considered satisfactory for such surveys. Interviews took an average of just under 20 minutes to complete. Useable responses were then weighted by age, gender and educational attainment to represent the whole population, giving a sample of 15,398. This was just under 0.1% of the adult population.
Survey of Business
This survey was designed to quantify the extent of giving by business. In particular questions were designed to:
- assess the overall value of giving in terms of money, goods and services (‘what’ businesses give)
- assess the overall value of giving through donations, sponsorships and community business projects (‘how’ businesses give)
- identify factors such as differences between the industry in which businesses are based and the size of businesses and their giving
- identify to whom businesses give within the nonproﬁt sector
- identify barriers to giving and the efﬁcacy of ways in which nonproﬁt organisations approach businesses to give
- identify awareness of tax related giving measures.
A postal survey was developed for this purpose, with follow up calls made to enhance response rates.
A total of 2,705 surveys were completed by businesses, representing a 37% response rate from those sampled.
Data from the survey was weighted to take into account a number of factors. An analysis of late responses was undertaken. This involved a study of completed surveys from late respondent businesses compared with earlier responses, allowing for a check, for example, to see if earlier respondents were more generous givers. In addition active calls were made to non-responding businesses to collect a few key data to also compare with responding businesses.
Data was also weighted by comparing the proportions of small and larger business, businesses by industry sectors and across jurisdictions (State/Territories) against ABS business data for these characteristics. These comparisons allowed for a weighting of data arising from the survey.
While all prudent and rigorous measures have been employed to ensure rigorous data from this survey, some qualiﬁcations must be made for readers tempted to make direct comparisons with the only other survey undertaken of giving by Australian business, that of the ABS (2002b) for the 2000-01 ﬁnancial year.
Some businesses have reported that over recent years their accounting procedures and practices have improved in ways that allow for a more accurate reporting of their giving. This may have introduced more accurate, but less comparable, information on business giving between these two key sources.
As noted in relation to the Individual and Household Survey, a ‘halo effect’ of the Tsunami appeals just prior to the conduct of the survey is likely to have had an inﬂuence —businesses proud of their recent contributions may have been prone to exaggerate or wrongly count this as part of non-Tsunami giving. While the survey instrument speciﬁcally asked that respondents separate these forms of giving, this may not have taken place in some instances.
There are a number of methodological issues to note regarding this, in comparison with the Australian Bureau of Statistics 2000-01 Business Generosity Survey (ABS, 2002b). Importantly, the ABS had access to a sample drawn from a near complete array of Australian businesses. The sample relied upon for this survey was broadly representative, but not the same and necessarily less complete. In addition, while the ABS is able to compel business to complete its surveys, this study could not.
Survey of Nonproﬁt Organisations
The purpose of this survey was to collect data on the activities undertaken by nonproﬁt organisations to strengthen their capacity through securing donations, engaging volunteers and working with businesses or undertaking commercial ventures. In particular the survey included questions that:
- provided data on key characteristics of nonproﬁt agencies completing the survey (ﬁeld of activities, size, location and span of activities)
- asked what, if any, activities were undertaken, what resources were applied in undertaking these activities, what supports or resources were thought useful in increasing such efforts and reasons for not undertaking these activities, if this was the case
- spanned key resource generating activities and their usefulness, included fundraising, volunteers, business partnerships and commercial ventures.
Three main data sets of nonproﬁt organisations were used for the distribution of the survey. These included:
- State-based fundraising registers: a data set of 987 nonproﬁt organisations was randomly sampled, at one in four using a random numbers table, from the six State Government Registers of charities. There were a total of 3,992 nonproﬁt organisations on these registers. Of those sampled, 252 completed responses, representing a response rate of 25.5%.
- Fundraising Institute – Australia (FIA) membership data set: a data set comprising 552 nonproﬁt member organisations of the FIA. These organisations are generally larger organisations that utilise a number of resource generating methods. A total of 17% of these agencies completed the survey.
- Web hosting: the survey was hosted on the ACOSS web site and links to this were distributed through a range of peak bodies across the nonproﬁt sector, representing organisations across different ﬁelds of activity.
Importantly no comprehensive data source exists in Australia of nonproﬁt organisations. Without such a rigorous sample frame it is not possible to quantify or extrapolate the results of this survey to claim representativeness of the entire nonproﬁt sector. Effort was taken to ensure that a range of nonproﬁt organisations completed the survey. In terms of organisational size, sector ﬁeld of activity or industry and geographical distribution, the responses are diverse and suggest the survey base is broadly comparable with the nonproﬁt sector.
This component involved the conduct of 34 focus groups and 38 in-depth interviews. Generally these were discussions that were not directed by researchers beyond providing a broad indication of interest in hearing participants’ experiences as givers or recipients. Some prompting was provided once open-ended discussions were held, and these provided a non-directed trigger for discussion of issues generally of relevance to this research (eg motivations for giving, ways approached etc.) that may not have been covered in the discussions to that point.
Focus groups and in-depth interviews were undertaken in the following locations and among the following participants:
- thirteen focus groups among ‘everyday’ individual donors, three among wealthy donors, two among people from large businesses, six among small and medium enterprises (SMEs), four from among foundations and six among non-proﬁt organisational personnel
- eight focus groups were held in Brisbane, ﬁve in Sydney, four in Melbourne, three each in Perth, Dubbo and Toowoomba and two groups each in Adelaide, Hobart, and Bendigo and single groups were held in Darwin and Canberra.
In-depth interviews were held in the following locations and among the following groups of participants:
- seven with wealthy individual donors, fourteen interviews with small and medium enterprises (SMEs), four with large business personnel, six with foundations and seven with non-proﬁt organisations
- ten in-depth interviews were held in Perth, seven in the Gold Coast, ﬁve each in Sydney and Melbourne, four in Bendigo, two in Adelaide and one each in Hobart, Darwin, Brisbane, Dubbo and Bega.
In addition, the following focus groups and a small number of in-depth interviews have been undertaken, and the ﬁndings from these will be included in a separate full report of qualitative research. These activities include a focus on:
- the capacity-building challenges of very small ‘grass-roots’ nonproﬁt organisations
- the challenges for nonproﬁt organisations in attracting bequests
- perspectives on indigenous philanthropy
- senior executive perspectives on corporate giving.
The ﬁnal stage of qualitative work has been the hosting of seven expert panels from among fundraisers, business personnel and others. These panels were used to examine/reﬁne the themes and suggestions from the data.
3.1 Individual and household giving
Through the Individual and Household Survey for this project, it is estimated that in the twelve months to the end of January 2005, 13.4 million Australians aged 18 or older, 86.9% of the adult population, gave a total of $5.7 billion5. This meant that those giving gave an average of $424 each. The median for giving was $100, that is, half of those giving gave more than this amount, and the other half less.
In addition an estimated $2 billion was provided by individuals to nonproﬁt organisations through funds raised via events and ‘charity gambling’6. An estimated
10.5 million people, or 68.6% of adult Australians, provided support to nonproﬁt organisations in this way, contributing an average of $127 annually. Most providing support in this way also made donations, but just fewer than 1 million who participated in these fundraising activities did not make donations during 2004. By far the most popular of these methods of giving was through gambling. The ﬁgures presented in this section are for donations of money by individuals and do not include giving through events and gambling.
Over the year to January 2005, an estimated 6.3 million people or 41% of the adult population, gave 836 million hours of their time as volunteers, an annual average of 132 hours each. The median for volunteering hours was 44, half volunteering more and half less that this amount.
There are no exactly comparable surveys that would enable precise comparisons to be drawn; however, there are several data sets that enable reasonably reliable estimates to be made of whether these ﬁgures represent an increase in giving and volunteering.
In 1997 the ABS collected data on giving from a random sample of 12,000 adult Australians. The survey was conducted on four occasions during the year, each occasion three months apart. Mostly respondents were asked about their giving over the previous quarter, but for some basic data they were asked to look back over a year.
The 1997 ABS survey showed that 9.1 million adult Australians, 69% of the adult population, gave a total of $3.02 billion, an average of $331 each (Lyons and Hocking, 2000). The data presented from this survey, for the year to January 2005, suggests a signiﬁcant increase in giving over the intervening seven years, both in numbers giving and the average sum given.
With the qualiﬁcations noted above, comparing these two sources suggests that over the seven years since 1997, there has been an increase of about 18% in the proportion of the adult population who give and an 88% increase in the amount given. This represents an average annual increase of 12.5% in the amount given. When we take account of inﬂation from 1997 to 2004, we ﬁnd the real increase in the value of giving to be 58%.
The likelihood that the 2005 data is exaggerated to some extent by a ‘halo effect’ caused by the positive endorsement of giving surrounding the Tsunami, has already been noted. However, a comparison with four other data sets was undertaken and this also suggested that the giving of money has increased in real terms over the past decade.7
Comparing giving in Australia with the USA in 2004 we ﬁnd that giving as a proportion of GDP in the USA is 1.6% and for Australia it is 0.68%. In Canada in the year 2000, donations were equivalent to 0.46% of GDP. This indicates that when the differences in the size of economies is taken into account, the USA generates more than twice the level of giving of Australia, and Australians give about one and a half times as much as Canadians on average.
When we turn to the giving of time, a similar story confronts us, though it is one that is slightly better documented. In 1995 and again in 2000, the ABS conducted a voluntary work survey. Several questions about volunteering were also asked in the 2002 General Social Survey (ABS 2003). These indicate a gradual increase in both the volunteering rate and in the number of hours volunteered. Along with its estimates for volunteering in 2000, the ABS also released revised ﬁgures for volunteering in 1995 (ABS 2001). This showed a volunteering rate of 24% and total hours volunteered of 512 million. The average hours volunteered by each volunteer was 160 per year. In 2000 the ﬁgures were a volunteering rate of 31%, a total of 704 million hours and an average number of hours per volunteer of 160 per year. By 2002 the rate had increased to 34% (no estimates of hours were provided). The data presented here for the year to 2005 also indicates an increase in both the percentage of the population who volunteer (41%) and in the total number of hours volunteered (836 million per year).
Interestingly, the average number of hours volunteered by each volunteer over the 12 month period has declined (from 160 in 2000 to 132 hours in the year to 2005). This decline in average hours is not particularly surprising. The big increase in the numbers of people volunteering is likely to be heavily weighted toward those who volunteer only a few hours. This would be true both of those who have only just begun to volunteer and also of those who have volunteered for many years but have only recently come to think of themselves as volunteers.
Over the past decade there has been much greater publicity given to volunteering, and a huge endorsement of it. The lead up to the 2000 Olympics and the Games themselves were pivotal in this, as was the 2001 International Year of Volunteers. Based on data on length of time volunteered in the 2000 Voluntary Work Survey (ABS, 2001), we estimate that half the increase in the volunteer rate over the preceding ﬁve years from 24% to 31% was due to new volunteers and half due to long term volunteers coming to recognise that what they had been doing was volunteering. A recent survey by Newspoll for Volunteering Australia reports that 77% of respondents said they were more aware of volunteering now than they were ﬁve years ago. Almost 80% said they believed volunteering was now more important for the community than it was ﬁve years previously. That survey (by telephone of a random sample of 1200 adults) reported a volunteering rate of 46% (Volunteering Australia, 2005).
According to a large sample survey conducted in 2003 by the United States Department of Labor, 27.6% of Americans aged 16 and over volunteered during the twelve months to September 2002 (United States Department of Labor 2002). The median number of hours volunteered was 52 per year. A signiﬁcantly higher proportion of Australians volunteered, but with slightly lower median hours than Americans.
In 2000, 27% of Canadians over 15 volunteered for a total of 1050 million hours, or an average of 163 hours per volunteer (Hall et al 2001). The rate has decreased since 1997, though the average hours volunteered have increased. It can be seen that a signiﬁcantly higher percentage of adult Australians volunteer, but for fewer hours on average than Canadian volunteers.
Characteristics of individual givers
The Individual and Household Survey conducted for this study has conﬁrmed known and long-standing patterns for individual givers and their demographic characteristics. These include:
- More women give, men give more often. 89.5% of women reported having made a donation in the year to January 2005, while 84.1% of men reported giving a donation. Men tend to give more when they do give, reﬂecting their higher incomes on average (the average annual amount given by women was $377 and, for men, $477 per year).
- More women volunteer and for longer than men. 45.9% of women reported volunteering in the year of the survey and average hours volunteered over the year were 139; men volunteered at a rate of 35.8% for an average of 123 hours in that year. Of all volunteer hours undertaken, 60% were provided by women.
- More older people give more. The likelihood that people will give increases slightly with age until middle age and then declines slightly (those aged 45-55 give at a rate of 88.4% and give, on average $500 per year). Those aged over 34 years are slightly more likely to give than the overall average for the adult population. Those over 65 who donate, on average make the largest donation and contribute, proportional to their numbers, the largest amount overall.
- More in middle age volunteer, but for fewer hours than others. The volunteer rate shows a typical inverted “U” shape, peaking for the 35-44 age groups (among which 46.6% volunteer). However, the distribution of mean hours takes the opposite shape, with the largest number of hours on average being contributed by older and younger volunteers (178 hours per year for those 55-65, and 132 hours per year for those 1824). Those aged between 23 and 54 are the most likely to have dependent children, and thus have greater demands made on them to volunteer in various activities that their children enjoy. They are also least likely to have many hours to devote to volunteering.
Income is a critical factor in the giving of money and overlays other factors (as seen in the note regarding women and giving of money). Again this relationship, together with related factors of labour force status and education, has been borne out by this research. Key ﬁndings are:
- More on higher incomes give and give more. The rate of giving and amounts given rise with income; those with incomes under $15,599 per year give at a rate of 82.6% and at an average of $264 per year; those on annual incomes of $52,000 or higher give at a rate of 90.5% for an average of $769 per year.
- Rates of volunteering are constant for income, but the amount of time given is greater the lower the income. The proportion of those in the community who volunteer is fairly constant for income (ranging from 39.9% to 44.1%). However, those on low incomes volunteer more than those who have higher incomes (those on incomes under $15,599 per year average 159 hours per year, those on incomes over $52,000 average 91 hours per year).
- High levels of education and labour force status correlate with high rates and amounts of giving. Related to the trends for income, those with higher levels of education, and those in professional and management positions, tend to give money at greater rates, and greater amounts, than those with low levels of education or lower status/pay jobs or those who are unemployed.
- The rate of volunteering rises with educational attainment but hours volunteered fall. Those with a school level only education volunteer at a rate of 36.9% but for an annual average of 142 hours. Those with a Bachelor or higher degree volunteer at a rate of 49.6% but for an average of 114 hours per year.
As the relationship between income and giving is fairly obvious for most, it tended to have been raised naturally as part of qualitative research in support of this project. Some of the key ﬁndings for ‘everyday individuals’ – those on average working incomes – and wealthier individuals, are summarised below.
These ﬁndings for everyday individuals include:
- Everyday individuals have their own comfort levels for giving beyond which they reach a saturation point. Many such people gave several hundred dollars annually. Analysis of focus groups and in-depth interviews categorised giving by such individuals as:
- reactive – spontaneous and often not associated with any great afﬁnity with the recipient cause eg when asked in the street, at the door, at a function, at work, by direct mail or phone
- as a believer to causes – included giving by people who were strong supporters of the organisation’s cause, and when approached by the organisation, they were more likely to give larger amounts (eg. $20 – $50). Subsequent involvement with the organisation tended to encourage this group to progress into some planned means of giving (eg. regular, automatic payroll, credit card or bank account deductions).
- proactive – where givers were very strong supporters of causes, often giving $100 or more via child sponsorship or a regular church donation; these are often decided upon as a family and repeated at least annually.
- Tax deductions only tended to be claimed when higher amounts were donated. Some reported that they did not make claims as they failed to collect receipts or to recall amounts given.
- All individuals (regardless of location) preferred volunteering in their local community.
Among wealthy individuals the qualitative research found:
- They mainly saw themselves giving money (time was a scarcer commodity for them). However, on prompting, common volunteer roles included service on nonproﬁt boards or committees, or occasionally by asking others to donate or by providing contact for this to occur.
- Approaches to these donors were commonly personal, often from their social circle and for money or 3-5 year pledges. However, many reported that asking others to give was difﬁcult and they feared could strain relationships.
- The social contract seemed important – as a successful, respected professional they felt they had a responsibility and desire to support worthy causes. When passion for a cause kicked in, giving increased substantially. Over time, charitable trusts and foundations become an option for more commitment.
- Few discussed or promoted giving, fearing an ‘asking avalanche’ would result in unmanageable and guilt inducing requests for further support. Wealthy non-givers were disdained and some givers felt they were shouldering the burden for all without wanting to. Most afﬂuent people knew of non-givers in their ranks.
- High interest was shown in new and innovative projects or their own projects where it was possible to place their personal stamp on things.
- Their main concerns included nonproﬁt duplication of effort, accountability and effectiveness.
- Giving tended to range from:
- ‘social’ level – at a yearly gala or event but with giving of signiﬁcant amounts of up to several thousand dollars, this giving was more reactive than proactive
- change agents – giving because they are personally touched, committed or actively cultivated and often giving at high levels of between $10,000 and $50,000 per year
- high ‘sustained’ giving – this often occurs through formal foundations that mean giving is organised and enduring over time and across generations, this is often focused on particular causes and can be around $50,000 per year.
- Most afﬂuent givers claimed tax deductions (through their accountant or adviser) and these deductions were an incentive. The exceptions were those with a particular cause passion who gave anyway and very generously in time and money.
Location is a factor in giving, although with only slight variations in most cases. Key ﬁndings include:
- Variations between states and between capital cities. Adelaide stands out with the highest rate of giving of money (90.5%), closely followed by Perth and non-metropolitan Queensland. But the highest average gifts are made by Sydney-siders ($524 per year); this probably reﬂects that city’s higher income proﬁle (see Table 1 below), although it also has the highest living costs. Sydney and Melbourne, whose residents comprise 40% of our sample, contributed almost half the funds donated.
- Those in regional areas volunteer at higher rates than those in cities, but for fewer hours. People living in capital cities are less likely to volunteer than those in the regions but, with the exception of Sydney, city-dwellers tend to volunteer for longer hours compared with their non-metropolitan cousins (see Table 2 below).
Qualitative research found that, in contrast to their metropolitan counterparts, those living in regional areas saw themselves inextricably and personally linked with their community; a high degree of interdependence and a concern for survival is evident in the need to work together. The weather also inﬂuenced giving patterns, for example drought has an impact on capacity to donate and rainfall can impair capacity to physically engage in volunteering. Smaller, relatively isolated cities (Hobart, Perth, even Adelaide) were often focused on local causes.
Place of birth is a factor in giving. The key ﬁndings from the survey are:
- Only slight differences in rates of giving, while amounts given vary by place of birth. The highest rates of giving are from overseas born English speakers (89.1%) who, on average, give $438 per year; those from overseas non-English speaking backgrounds give at a rate of 83%, on average of $398 per year. For those born in Australia the rate is 87.1% for $426 per year.
- Rates of volunteering and hours given are lowest for those from non-English backgrounds. Those from non-English speaking backgrounds volunteer at the lowest rates (32.7%) and give the lowest hours per annum (124) compared with those born overseas in English speaking countries (40.2% and 157 hours per year) or those born in Australia (42.2% and 130 hours per year).
It is relevant to note that patterns of giving of time and money may, for some from culturally diverse backgrounds, be focused on the needs of extended family and community networks either in Australia or overseas. These forms of giving may not have been adequately captured by our survey method. For some, such engagement may not be perceived as giving. Data from Roy Morgan Research (Giving Australia, 2004) found that while rates of donation of money are fairly stable across most groups based on background, those born in Greece and the USA tended to donate more. These ﬁndings are suggestive of cultural differences in, and understanding of, giving.
Household type is a factor in giving. The type of household in which a person lives seems to have little effect on giving. However the following were notable:
- Sole parents and those living in group/share households give less money. These groups often have low incomes on average (those in group/share households often being students) and give less money than others ($290 per year for sole parents compared with $466 per year for a couple living with children at home; $313 per year for those in a group/share household compared with $431 per year for a person living alone).
- Sole parents are active volunteers. Single parents volunteer at a slightly higher rate than two parent families (49.2% compared with 46.1%) and volunteer for slightly more hours on average (129 hours per year compared with 122 hours per year).
Qualitative research in support of this project identiﬁed a desire among parents and others to provide a positive role model for children and that this was as an important factor in parents engaging in giving as a way of encouraging their children to do so as well.
3.2 Business giving
The key ﬁndings from the Survey of Business resulting from this research are:
- the total value of giving found through this survey for the 2003-04 year was $3.3 billion – given by 67% of all Australian businesses or 525,900 businesses
- business giving consisted of 68% in money ($2.21 billion), 16% in goods ($0.52 billion) and 16% in services ($0.52 billion)
- business giving consisted of 58% in donations ($1.9 billion – given by 58% of all Australian businesses or 451,600 businesses); 25% in sponsorship ($0.81 billion – given by 20% of all Australian businesses or 156,700 businesses); and 17% in community business projects ($0.54 billion – given by 19% of all Australian businesses or 148,700 businesses).
Figure 1: Number of businesses by type of giving
Small and medium sized businesses are the most numerous across industries generally and together give the greatest amount. However, by comparison more large businesses give and give more. Businesses with fewer than 11 employees account for 89% of all Australians businesses and 66% participated in some form of giving (giving $1.5 billion or 47% of all business giving). At the other end of business size, businesses with 501+ employees account for fewer than 1% of all businesses in Australia and 89% participated in some form of giving (giving $654 million or 20% of all business giving).
Large businesses tend to engage in more sophisticated forms of giving, such as community business projects and sponsorship, and tend to have developed programs for giving.
Measured in terms of the proportion of businesses giving, more direct customer service businesses give more often—Construction (92%), Health and/or Community Services (90%), Utilities (87%) and Communication Services (84%). In terms of amount given, businesses in the Property/Business Services ($668 million), Construction ($529 million) and Retail Trade ($505 million) were the most generous.
More businesses in South Australia, compared with businesses in other states, give and a higher amount. Businesses in regional Australia express a strong preference for giving to local nonproﬁt organisations.
There are a number of important qualiﬁcations in comparing the Survey of Business reported here with the only other study of business giving undertaken in Australia (ABS, 2002b). The ABS was able to sample a full array of Australian businesses and was able to compel businesses to participate. Also a ‘halo effect’ of the Tsunami appeals just prior to the conduct of the present survey were likely to have had an inﬂuence, causing some businesses to exaggerate their non-Tsunami giving. However, even with these qualiﬁcations it is evident that business giving has grown.
For the 2000-01 year the ABS (2002b) estimated the following:
- the total value of giving was $1.5 billion
- business giving consisted of 64% in money ($0.9 billion), 16% in goods ($0.2 billion) and 20% in services ($0.3 billion)
- business giving consisted of 40% in donations ($0.6 billion); 47% in sponsorship ($0.7 billion); and 13% in community business projects ($0.2 billion).
At face value, the comparisons between the ABS data for 2000-01 and the ﬁndings of this research for 2003-04 suggest an increase of more than double in business giving over three years. This may be an over-estimate and will partly be a function of the different methods employed by the two studies. Somewhat more conﬁdence may be had in comparing the proportions of ‘what’ (money, goods, services) and ‘how’ (donations, sponsorship, community business projects) of business giving.
These comparisons suggest that over this period business is now somewhat more likely to give money and goods, but is relatively less likely to give in the form of services.
The same comparisons for how business gives suggest that business is now more likely to give by way of donations and community business projects, but is relatively less likely to give through sponsorship.
Industry differences in giving
Businesses in industries involving direct customer service tend to give most often. Key ﬁndings regarding industry difference, presented in Table 3, include:
- Businesses giving most often, measured in terms of proportion of businesses giving, were Construction (92%), Health and/or Community Services (90%), Utilities (87%) and Communication Services (84%). The most generous industries for donations were Construction, Utilities and Communication Services. Contributions to community business projects were most likely to be made by businesses in Health/Community Services (81%), Accommodation/Cafes /Restaurants (62%), Retail Trade (27%) and Transport/Storage (21%). Sponsorship was most common among Retail Trade (46%), Communication Services (33%) and Construction (23%).
- Businesses that gave less frequently were, in terms of proportion of businesses giving, businesses in Education and Transport & Storage, both with less than 25% involvement in overall giving.
|TYPE OF GIVING|
|Electricity, Gas, Water||500||0||0||500||600|
|Property, Business Services||114,300||8,000||35,500||127,000||172,100|
|Health, Community Services||4,400||43,800||3,000||48,800||54,200|
|Cultural, Recreational Services||5,400||900||300||6,000||20,000|
The industries which gave the largest amounts overall were Property/Business Services ($668 million), Construction ($529 million) and Retail Trade ($505 million).
Businesses in these industries also tended to donate the largest amounts, rather than give via sponsorship or community business partnerships. Greater giving by these industries as a whole was driven by the fact that these are some of the biggest industries in terms of number of businesses. However, as can be seen from Table 4, the proportion of businesses actually giving from these industries was above average.
The Retail Trade gave the largest amount to community business projects –$93 million —followed by Health/Community Services ($82 million) and Finance/Insurance ($77 million). Unlike most other industries, the Health/Community Services industry gave more to community business projects than in donations and sponsorship.
The Retail Trade gave the largest amount to sponsorship ($155 million), followed by Transport/Storage and Finance/Insurance (each about $109 million).
|TYPE OF GIVING|
|Electricity, Gas, Water||560||92||391||1,043|
|Accommodation, Cafes, Restaurants||61,146||65,675||9,671||136,492|
|Property, Business Services||532,028||61,645||73,863||667,536|
|Health, Community Services||55,572||82,432||54,551||192,555|
|Cultural, Recreational Services||118,797||25,405||34,691||178,893|
Business size and giving
Giving was more likely to be made by larger businesses (in terms of number of employees). Of businesses with less than 11 employees, 66% participated in some form of giving, while the equivalent ﬁgures for businesses with 11-50 employees were 77%, and 96% among businesses with 501+ employees.
The proportions of businesses giving in the form of donations followed a similar pattern. community business projects and sponsorship were also more likely to be undertaken by larger rather than smaller organisations.
Businesses with 1-10 employees gave the largest amount overall—$1.5 billion or 47% of all business giving. This group makes up 89% of Australian businesses. However, businesses with 501+ employees gave a relatively large amount ($654 million or 20% of all business giving) for a group of only approximately 1,500 businesses (less than 1% of all businesses).
A cross tabulation of business size, measured by number of employees, by how businesses give—money, goods (including a detailing of speciﬁc goods) and services (also detailed) has been undertaken. Larger businesses give all forms of assistance to nonproﬁt organisations more often on average than smaller businesses. However, very small businesses have been found to more often give some speciﬁc forms of goods and services compared with larger businesses. Businesses with under 11 employees were more likely to give accommodation (7%) than either businesses with 501+ employees (6%) or the overall average (6%). Similarly, these very small business were more likely than larger businesses to provide services in the form of strategic planning and management advice (6%) than businesses with 501+ employees (4%). The small businesses were also more likely to provide staff training (9%) and employee time (15%) than the overall averages (8% and 14% respectively).
Businesses with 501+ employees gave the largest amount in sponsorship ($264 million) and the second largest amount in community business projects ($184 million). It seems that these more sophisticated forms of business giving tend to be relatively more accessible for larger businesses.
Focus group and in-depth interview research in support of this project, lead to a number of observations regarding business size and giving. These include:
- Strong giving by mostly larger businesses showed the importance of espoused social responsibility values and a delineation between sponsorship and other giving, as well as the application of policies, plans and sometimes people to administer giving, sometimes through a mix of giving of staff time, money and goods. This was often associated with staff being interested in volunteering and an associated focus on ‘work-life balance’. Often larger businesses had a formal corporate foundation.
- Among larger businesses, giving is clearly distinguished from, but complements, marketing, human resource and corporate strategies; localised staff efforts (volunteering, staff donations) were encouraged, as well as choosing causes – these were seen as empowering staff, lifting morale, ﬁnding support from head ofﬁce; larger businesses were often motivated by a sense of social responsibility and desire to express their values as an organisation.
- The larger businesses that give most consistently tend to have won management commitment, have a formal budget, qualiﬁed staff and systems in place to manage this function within the organisation.
- Those least likely to give were often small and medium sized businesses that displayed a concern that giving contradicted their responsibility to stakeholders and/or shareholders—principals in a business were likely to consider giving as a personal or private responsibility. Such businesses tended to lack a giving ‘vision’, a clearly deﬁned function for giving and/or had few systems to record or budget for giving. These businesses had little exposure to best practice giving, reported difﬁculty coping with requests from nonproﬁt organisations and tended to blur the lines between commercial activities, such as sponsorship, and more altruistic engagement; they were often focused on business sustainability or survival.
- Small and medium businesses were generally less organised and more reactive in their giving than large businesses. Small, locally-based businesses, often with a retail shopfront identiﬁed closely with their immediate community, and reported operating on a relatively tight cash ﬂow; however they felt part of the local community and were happy to contribute to it. They were almost exclusively approached by locally-based nonproﬁt organisations (such as the local football club) and they gave consistently, at a relatively low level, to these causes. Some were engaged through service clubs (for example, Lions or Rotary) in community causes and this individual activity seemed to inﬂuence their attitudes to giving within their business.
- There was a strong interest in better managing giving practices, especially by small and medium businesses.
Location of business and giving
The Survey of Business for the project was able to identify the State/Territory location of business but breaking data down to regional (eg metropolitan/non-metropolitan) proved difﬁcult as many businesses have a wide scope of operations. However, differences by State were observed and are presented in Table 5. These included:
- The amount of giving was fairly much in proportion to the number of businesses, except that South Australia had 12% of the giving but only 6% of the businesses, and Queensland had 9% of the giving compared with 19% of the businesses.
- South Australian businesses participated in some form of giving to a greater extent (80%) than West Australian businesses (49%). Relatively large proportions of South Australian businesses gave in the form of donations and sponsorship, while a relatively large proportion of Queensland businesses gave to community business projects.
Qualitative research identiﬁed a strong preference among businesses in regional and rural communities to give to local causes and nonproﬁt organisations.
|TYPE OF GIVING|
|(inc. TAS, NT, ACT)||58%||19%||20%||67%||100%|
- These ﬁgures exclude giving associated with the Tsunami appeals in late 2004 and early 2005.
- ‘Charity gambling’ includes fundraising through rafﬂes, lotteries and art unions
- The other sources used were the McNair Ingenuity Charities Awareness survey series, the Roy Morgan Research Single Source data on giving, deductible gift recipient data from the Australian Taxation Ofﬁce (ATO) and the 2000 ABS survey on volunteering, which also asked some questions on donations.
The nonproﬁt sector in Australia is large and diverse. According to the National Roundtable of Nonproﬁt Organisations (2003:1) key features of the sector in Australia include:
- an estimated 700,000 nonproﬁt organisations in Australia, most of which are small and entirely dependent on the voluntary commitment of members
- approximately 380,000 nonproﬁt organisations are incorporated in some form or another
- about 35,000 nonproﬁt organisations employ staff
- there are approximately 20,000 organisations with Deductible Gift Recipient status in Australia. Most of these are nonproﬁt organisations
- for 1999-2000 the ABS (2002a) estimated the nonproﬁt sector’s total revenue at $33.5 billion.
Data collected through this study could not capture all of the detail of such a large and diverse sector. For example, it has been necessary to collate data on the recipients of nonproﬁt related giving under broad headings such as ‘arts and culture’ and ‘community and welfare services’ etc, even though under each such heading a wide range of activities is undertaken (eg visual arts, performing arts; community housing or legal services etc).
Table 6 presents the proportions of value of giving (ie the proportion of total dollars given through individual donations and business giving and of total hours volunteered) to selected ﬁelds of nonproﬁt activity. The row at the bottom of the table records the total dollars donated or given and total hours volunteered for those years. It should be kept in mind that in ﬁelds where the percentage of dollars and hours given is less than 10% there is likely to be a large error. Indeed, all the movements estimated here are indicative, not deﬁnitive. This table enables us to gain an understanding of the preferences for giving by different sources to different nonproﬁt activities.
Key features from this comparison, by nonproﬁt ﬁeld of activity, include:
- Community and welfare services are signiﬁcant beneﬁciaries of giving, receiving from all individual donations about one in eight dollars, better than one in four hours of all volunteering and almost a third of all business giving.
- Education nonproﬁt organisations receive about the same proportion of overall individual donations and business giving, about one in twenty dollars from these sources. This ﬁeld receives comparatively more by way of volunteering, accounting for one in eight hours volunteered.
- Environment and animal welfare groups receive about one in twenty of the value of all donations by individuals, about half that proportion of hours volunteered and a very modest level of the total support from business giving (at less than 1% of its total).
- Health nonproﬁt organisations, including medical research organisations, are signiﬁcant beneﬁciaries from all sources of giving, receiving about one in six of the total value of donations by individuals, one in ten hours volunteered and almost one in ﬁve of the total value of business giving.
- Sporting and recreation groups receive only a modest proportion of the total of all individual giving but very much more support from volunteering and business giving, at between one in ﬁve to one in six in total, respectively.
- Arts or cultural organisations receive about one in every forty dollars donated by individuals and a slightly higher proportion of total volunteer hours. These organisations receive almost 10% of total business giving.
- Religious institutions are very signiﬁcant beneﬁciaries of donations by individuals (accounting for more than one in three of the total value) and account for about one in six of all hours volunteered. Business giving to religious institutions was not speciﬁcally recorded through the Survey of Business.
- International aid and development nonproﬁt organisations receive a little more than one in eight of all dollars donated by individuals, but a negligible amount of volunteering. Business giving to international aid and development organisations was not speciﬁcally recorded through the Survey of Business.
(% TOTAL VALUE)
(% OF TOTAL HOURS)
|Arts or cultural associations||2.3||3.4||9.3|
|Community or welfare services||12.8||28.2||30.5|
|Environmental or animal welfare groups||4.8||2.6||0.9|
|Health (including medical research)||14.2||10.3||18.5|
|Sporting and recreational groups||3.7||19.7||17.7|
|Other nonprofit sectors||6.2||7.2||18.1|
|Total Value||$5.7 billion||836 billion hours||$3.2 billion|
Table 7 below sets out these comparisons over time, for available years, of giving to selected ﬁelds of nonproﬁt organisational activity. While in some ﬁelds the total number of dollars donated or hours volunteered has increased, often spectacularly, in a few it has declined. In considering these trends it is important to recall that in adjusted dollar values and in hours volunteered, there have been signiﬁcant increases over the period since previous surveys.
Since 1997, donations by individuals have increased 88% or 58% in current dollar values and since 2000, hours volunteered increased by 16%. Although direct comparison of the two business surveys for 2000-01 and 2003-04 must be heavily qualiﬁed, it seems that such giving has about doubled in nominal terms.
|Arts or cultural associations||0.7||2.3||4.8||3.4||4.8||9.3|
|Community or welfare services||15.8||12.8||26.0||28.2||23.4||30.5|
|Environmental or animal welfare||2.2||4.8||1.3||2.6||2.3||0.9|
|Health (including medical research)||11.9||14.2||5.3||10.3||9.6||18.5|
|Sporting and recreational groups||8.1||3.7||21.2||19.7||43.4||17.7|
|Total ($ & hrs)||$$3018 mil||$5687 mi||702 mil hrs||836 mil hrs||$1446 mil||$3251 mil|
The following notes summarise some of the trends in relation to the proportions of total giving to nonproﬁt ﬁelds from three main sources (individual donations, volunteering and business giving). While many proportions have changed, it is relevant to note that overall from all sources giving has grown. Some observations based on these ﬁgures include:
- Arts and cultural associations have enjoyed marked increases in the proportion of the total value of donations from individuals and business giving – although this comes from a low initial base and should be treated with some caution, the trend is clear. By contrast, the proportion of total hours volunteered to this ﬁeld has declined, going against a general rising trend.
- Community and welfare services now receive a smaller proportion overall of total individual donations, but have enjoyed a rise in the total proportion of hours volunteered. The proportion of total value of business giving has risen.
- Education nonproﬁt organisations have experienced a comparative fall in the proportion of donations from individuals, total volunteering hours and of business giving.
- Environment and animal welfare groups have beneﬁted from marked increases in the proportion of total individual donations and volunteering, although from a small initial base leading to caution in assessing magnitude, the trend is clear. Similarly, business giving to this ﬁeld has been and remains modest, so caution is needed, but the proportion of such total giving seems to have fallen.
- Health nonproﬁt organisations are experiencing substantial increases in the proportion of total giving from all sources.
- Sporting and recreation groups are receiving proportionately smaller totals of individual donations, of total volunteer hours and business giving.
Of course the amounts and rates of giving to nonproﬁt organisations, including over time, might ideally be assessed against indicators of the community needs, to enable judgements to be made about whether or not these are being met adequately by giving. Such an assessment is beyond the brief of this project.
4.1 Giving to nonproﬁt organisations by individuals and households
The tables below set out for organisations in each major ﬁeld of nonproﬁt activity, the levels of support received from individuals, both through donations and then volunteering. These have been drawn from the Individual and Household Survey.
Table 8 presents data on donations to nonproﬁt ﬁelds including the percentage who are donating, the average donation per giver and the percentage of total donations to a given ﬁeld.
More people support organisations providing community services than organisations in any other ﬁeld, but the average size of each supporter’s donation is among the smallest, and so these organisations, the traditional “charities”, receive only one dollar out of every eight donated. Similarly, donations for medical research are common, three out of every ﬁve adult Australians give to these, but are of relatively small amounts on average. By contrast, international aid and development organisations receive slightly more overall, even though they are supported by only one-quarter of the population. The proportion of those donating to religious institutions is high and the total proportion of donations to these higher still.
|% DONATION||% AVERAGE DONATION
PER GIVER ($)
|Arts or Cultural Associations||4.8||220||2.3|
|Australian Emergency Relief Services||36.6||52||4.2|
|Community or Welfare Services||69.5||81||12.8|
|Environmental or Animal Welfare Groups||24.7||87||4.8|
|International Aid and
|Interest Groups (professional and business assns,
unions, politicalparties, other advocacy groups)
|Recreational or Hobby Groups||3.9||75||0.7|
|Religious or Spiritual Organisations||30.2||529||36.1|
Table 9 provides data on volunteering by nonproﬁt ﬁelds, including the proportion of those who volunteer, average hours volunteered and the total proportion of all volunteering hours given.
The picture for volunteering has some interesting differences. Organisations providing community and welfare services receive voluntary support from one-third of the adult population and they receive almost one-third of the total hours volunteered. Education (mainly schools and parent groups) are supported by 20% of the population and receive 12% of the hours volunteered. Sporting clubs are supported by 17% and receive around the same percentage of hours. Religious organisations receive a lower proportion of volunteer assistance than donations. Volunteers for arts and hobby groups seem to put in the most time volunteering – an expression of their commitment and their afﬁliation.
|% VOLUNTEERING||% AVERAGE HOURS
|Arts or Cultural Associations||3.1||159||3.4|
|Australian Emergency Relief Services||4.8||119||4.0|
|Community or Welfare Services||33.9||119||28.2|
|Environmental or Animal Welfare Groups||3.3||117||2.6|
|International Aid And Development Organisations||3.0||72||1.4|
|Recreational or Hobby Groups||3.0||162||3.1|
|Religious or Spiritual Organisations||15.6||136||15.0|
An analysis was undertaken to explore the extent and strength of afﬁliation as a factor in giving to different ﬁelds of nonproﬁt activity. Table 10 below presents ﬁndings across a range of nonproﬁt ﬁelds and sets out the percentage of donors that have some form of afﬁliation (member, volunteer or user) with organisations in that ﬁeld, along with the mean donation to those organisations by afﬁliated and non-afﬁliated donors and the percentage of donations made to organisations in that ﬁeld that are contributed by afﬁliated donors. The ﬁelds where afﬁliated giving is greater than 60% are: arts, education, sport, recreation, interest groups, and religious organisations.
|NUMBER CASES||% WITH FORM
|Arts or Cultural Associations||103||64.1||87||140||73.1|
|Community or Welfare Services||3,485||24.0||82||96||26.9|
|Environmental or Animal
|International Aid and
|Recreational or Hobby Groups||143||66.9||70||63||63.6|
|Religious or Spiritual
4.2 Giving to nonproﬁt organisations by business
Table 11 presents data on business giving by nonproﬁt recipient sector. This is drawn from the Survey of Business.
Of all businesses giving during the 2003-04 year, 280,600 businesses, or 53%, gave to community service and welfare nonproﬁt organisations. Most of these gave in donations. A total of 127,800 businesses gave to health, and 147,800 gave to sports and recreation. The latter included 49,300 organisations that gave in sponsorships. Only 3,200 businesses gave to environment organisations.
|TYPE OF GIVING|
|Arts and Culture||43,000||1,000||8,700||51,100|
|Community Service and Welfare||266,600||43,400||31,700||280,600|
|Sports and Recreation||90,400||32,200||49,300||147,800|
|An Individual Sports Person||-||-||1,500||1,500|
|Education and Training||44,900||2,300||16,500||61,700|
|Total (inc. others, not stated)||451,600||148,700||156,700||525,900|
Note: This is the total number of businesses that gave. As some businesses gave more than once, the total is lower than the number of instances of giving reported in the table.
Table 12 presents data on the value of business giving, in various forms, to a range of nonproﬁt ﬁelds of activity. Community service and welfare beneﬁted most from overall business giving with almost $1 billion given to that activity. The vast majority (nearly $800 million) of this came from donations. Health also received over $600 million in total, and sports and recreation received almost $560 million (largely from sponsorship). The environment received one of the least – $30 million. It should be noted that many businesses did not state the beneﬁciaries of their giving.
|TYPE OF GIVING|
|Arts and Culture||219,895||6,773||76,849||303,517|
|Community Service and Welfare||773,970||119,101||97,110||990,181|
|Sports and Recreation||154,488||48,695||354,371||557,554|
|An Individual Sports Person||–||–||18,634||18,634|
|Education and Training||106,892||22,263||34,356||163,511|
Note: The above dollar amounts for individual activities of beneﬁt may be understated because some businesses did not state an activity of beneﬁt for their giving.
Table 13 presents data on the amounts given by businesses across different industries for ﬁeld of nonproﬁt activity. The industries giving the most to community service and welfare were Construction ($295 million), Retail Trade ($196 million) and Property/ Business Services ($119 million). The Retail Trade ($166 million) and Health/Community Services ($119 million) were the biggest givers to health, and the Wholesale Trade ($89 million) and Property/Business Services ($85 million) were the biggest givers to sports. Businesses in the Property/Business Services industry gave most of all to recreation and arts and culture nonproﬁt organisations.
Giving strengthens nonproﬁt organisation in obvious ways. When money or time is given, nonproﬁt organisations can, and mostly do, enjoy greater capacity to fulﬁll their missions within the community. However, gaining an understanding of the ways in which giving, and nonproﬁt organisations may be strengthened is complex and not always obvious.
This discussion begins with a consideration of the reasons or motivations for giving. Most consider giving to be motivated by altruism, which is found to be an important factor and one that helps to predict frequent and generous giving. A more subtle and related concept is the role that giving plays in afﬁrming identity for givers. Those with religious beliefs are among the most generous of givers. For most givers the reputation of, and trust in, nonproﬁt organisations is important. Business expresses the importance of giving as ‘a good thing to do’ irrespective of returns, but many businesses point to giving enhancing their image and reputation, improving publicity and helping to build relationships with clients and for improving staff morale. Afﬁliation and reciprocation between givers and recipients—as volunteers, users of nonproﬁt services or members —are also found to be important motivators.
Sustaining giving is most likely when an understanding of motivations for giving is built upon by mechanisms that foster planned giving. A commonly held view is that giving is spontaneous; indeed 51% of donations are one-off, but often quite small. Nonproﬁt organisations are most likely to be sustained by regular and generous giving built on a long-term relationship with the giver. Givers who describe their donation as planned, tend to have given more. This is a double win, as fewer resources are then needed for securing donations and more can go toward achieving the ends that are the community purposes of nonproﬁt organisations.
A number of forms of planned giving are analysed. Bequests and the role of foundations and trusts are among these. Such forms of giving are often substantial. They are also often strategic by being sustained and supportive in addressing systemic problems and meeting gaps in community need.
Taxation measures also foster planned giving. While only about one in four dollars donated is claimed for tax purposes, those who respond to tax related giving incentives are often wealthier community members and their rates of donation and the magnitude of these are growing. A number of relatively recent innovations in Australia taxation law aimed at foster giving are assessed. Prescribed private funds are small in number but have grown quickly to become signiﬁcant. A capacity for growth is evident for workplace giving. Workplace giving is a simple and effective way to regularly donate to charitable organisations through automated payroll deductions.
The approaches that nonproﬁt organisations adopt to secure giving are also analysed. Some frequently used approaches, such as telemarketing, are found to be unpopular, but reasonably effective. However, these and other invasive approaches, and the overall credibility of nonproﬁt organisations through their adoption, pose risks to giving. Donors report a preference for door knock appeals, especially when undertaken by volunteers and when publicised. Businesses have a preference for, and do respond fairly well to, written requests supported by documentation.
A discussion of the resources and issues relevant to directly strengthening nonproﬁt organisations is provided, based in part on a survey of these organisations. Fundraising and volunteering are the two most widely adopted ways of generating resources. However, the use of particular practices varies, often based on the size of nonproﬁt organisations. Smaller organisations rely comparatively more heavily than larger organisations on gambling and volunteers and generally on a smaller array of strategies. These smaller organisations often lack both the resources to diversify their activities for generating resources and/or the knowledge to do so. Larger nonproﬁt organisations engage more often in a full array of fundraising activities, support from volunteers, commercial ventures and partnerships with business. However, even with experience larger organisations face constraints, particularly important being ﬁnancial and human resources limits, in particular attracting, retaining and training good fundraisers. As with any organisation, leadership at a CEO level is important and, as a deﬁning characteristic of the nonproﬁt sector, voluntary board members providing good, advice, support and contacts are a factor in success.
Finally, nonproﬁt personnel have had input to this project through their participation in focus groups and in-depth interviews. A range of issues were raised including concern about the reputation of the nonproﬁt sector, relations with government and the need for a sound legislative environment that helps in the management of risk and the construction of community conﬁdence through practical methods for transparency and accountability.
Many nonproﬁt organisations recognise the opportunities that giving from volunteers, donors, business and foundations or trusts can provide, but there is often a sense that choosing among these possibilities, while facing day to day challenges, can be overwhelming.
5.1 Reasons for giving
Reasons for giving by individual and households
People have many reasons or motives for giving. There is a huge literature on why people give, a literature contributed to by psychologists, economists and sociologists, each with their own disciplinary approaches. By contrast with the complexity of the academic literature, popular assumptions are that people who give are motivated by selﬂessness or altruism.
This section explores the wide range of reasons or motivations that people state as the basis for giving. Data from the Individual and Household Survey are reported as well as qualitative research ﬁndings presented.
As part of the Individual and Household Survey a particular donation by the respondent was selected for closer examination. These are listed in Table 14 below in the order of their frequency of being mentioned. The percentage who stated that reason is given, together with the average amount given by people who gave that as their reason, the total they donated, as well as the proportion of the total sum given by this subset of donations.
The strongest set of reasons, in terms of frequency with which they were invoked, were:
- Afﬁrmation of identity. This included identifying with the cause and the people whose assistance is the object of the cause (reasons 1 and 3 listed in Table 14 below). These are the reasons given by almost half the donors.
- A sense of reciprocation. Almost one-third say they give because of a sense of reciprocation for services already provided, or anticipation that help might be needed in future (reasons 4, 5 and 7).
- Respect for a nonproﬁt organisation. Just over one-quarter nominate respect for, or trust in a nonproﬁt organisation (reasons 2 and 8) 8.
- Desire to strengthen the community/make the world a better place. This was nominated by just less than one in eight respondents (reasons 6 and 12).
Different reasons appear as factors to help explain the frequency and magnitude of donations. For example, the 32% who afﬁrm that they gave because they thought it a good cause gave 18% of the total given. Only 4.8% said they gave because of a sense of religious obligation, but they gave almost 13% of the total.
|% STATING||MEAN DONATION
|% TOTAL GIVING|
|1. It’s a good cause/ charity||31.5||127||518,060||18.1|
|2. I respect the work it does||22.9||137||402,119||14.1|
|3. Sympathy for those it helps||14.3||137||253,836||8.9|
|4. I/ someone I know has/ had an illness
or condition it tries to cure
|5. I/ someone I know has directly beneﬁted
from its services
|6. To help strengthen the community||7.8||168||170,138||6.0|
|7. I/ someone I know might need its help
in the future
|8. I trust it to use the money correctly||5.0||232||147,068||5.2|
|9. A sense of religious obligation||4.8||603||362,038||12.7|
|10. I/ someone I know is/ used to be a member||4.3||204||113,357||4.0|
|11. I felt obliged to the person who asked||3.8||76||37,674||1.3|
|12. To help make the world a better place||3.8||313||155,820||5.5|
|13. Gives me a feeling of goodwill/ makes me
feel good about myself
|14. I volunteer my time for the organisation||1.4||277||47,801||1.7|
|15. My employer encourages staff to give||0.3||70||2,942||0.1|
|17. Can’t say||2.5||94||28,423||1.0|
Givers were also asked about any afﬁliation they have with the entities that they give to and an analysis was undertaken of the frequency and level of giving. Findings include:
- Afﬁliation with a nonproﬁt organisation strongly correlates with giving. Around 34% of givers claimed some sort of direct afﬁliation with the organisation to which they were donating ie they belonged to the organisation, or they volunteered for it or a family member had beneﬁted from it. For 25%, this afﬁliation was that they (or family members) used the service provided by a nonproﬁt organisation (some of these were also members of the organisation or volunteered for it). Fourteen percent were volunteers and 12% were members—again in both cases many were users or volunteers as well as members and so on. Afﬁliation encouraged a higher level of giving. Afﬁliated givers on average gave $214 over the preceding 12 months compared to givers without an afﬁliation, who gave on average $114. Overall, the 34% of afﬁliated givers gave 49% of all money donated.
- Practising and holding a religious afﬁliation increases giving, including to non-religious causes. The results show that having a religion and attending religious services signiﬁcantly affects the likelihood to give and the amounts given (those with a religion gave at a rate of 88.9% at an average value of $460 per year compared with 83.5% who don’t have a religion, at an average value of $223 per year). When giving by those with a religion to their own religion is not included, the overall rate and amounts given are about the same as for those who do not have a religion. For those who have a religion, the less often they attend a religious service, the more often they give to non-religious nonproﬁt organisations.
- Volunteers give more, more often and their giving is more specialised. Of the 41% of people who are volunteers in Australia, 91.2% give money to a nonproﬁt at an average amount of $538 per year compared with a giving rate for non-volunteers of 83.8% for an average value of $251 per year. In addition, 79.2% of volunteers give (money or time) to an organisation in one ﬁeld of nonproﬁt activity. By comparison 18.4% of all givers (of time and/or money) give to organisations in one ﬁeld of nonproﬁt activities, and 20.1% give to ﬁve or more organisations in different ﬁelds of nonproﬁt activity.
Qualitative research explored the attitudes to giving and related motivations and these reinforce many of the ﬁndings from quantitative analysis. These ﬁndings are organised around the expressed views of everyday individuals, those on middle incomes, and wealthy individuals.
Everyday Australians tended to like to support a wide range of causes. They particularly wanted to support those innocent of the problems they experienced (with some prejudices expressed regarding drug addicts and single mothers). Age inﬂuenced interests, university students tended to prefer volunteering for environmental causes or animal rights, and young people preferred to volunteer for discrete projects rather than on an ongoing basis.
Connection and relevance of nonproﬁt organisations, for everyday individuals, stemmed from:
- it being local
- its having an impact on them or their family
- there being an emotional connection including social justice reasons.
Wealthy individuals seemed more interested in systemic change (eg. medical research, education related causes). In addition, these individuals were supportive of the arts.
Strong concern about duplication and wastage by nonproﬁt organisations such as ‘cars for fat cats’ was expressed. A moral dimension was expected in CEO and others salaries with some believing charities should be totally volunteer run to keep costs down. Corporate-style approaches to promotion were seen as unnecessary.
Connection and relevance of nonproﬁt organisations, for wealthy individuals, stemmed from:
- a personal belief that these were addressing genuine needs (often not fully addressed by government)
- community legitimacy (eg. a children’s hospital)
- endorsement through formal or informal networks or via someone respected
- perceived trustworthiness and accountability, predicated on proving that money was used effectively.
Reasons for business giving
Reasons for giving by business follow patterns similar to those identiﬁed above for individuals.
In the Survey of Business making donations was seen as ‘a good thing to do, irrespective of the return for us’ by 403,600 businesses, or almost 90% of all businesses which made a donation. This is a high expression of altruistic motives by business for giving.
Business factors are also important in giving. 137,100 (30.4%) of businesses that donated felt that making donations was ‘good for their business’s image’, 94,800 (21%) that it was ‘good publicity’, while 76,500 believed it was good for their relationships with certain clients or suppliers. Other factors cited were gaining a tax beneﬁt and improved employee morale.
Figure 2 summarises these stated beneﬁts to business of making donations. These patterns of response were similar to those for giving through community business projects and sponsorship.
Figure 2: Beneﬁts of making donations
The Survey of Business also asked about barriers to giving from which it is reasonable to infer reasons and motivations and limits to these.
The largest barrier to making donations was that business resources were committed elsewhere. This was seen as a barrier by 340,700 businesses or 44% of all businesses in Australia. Related to this another 59,300 businesses nominated ‘business restraints/ limited resources’ as a barrier to giving. Some 12% of businesses (91,800) did not believe it is business’ responsibility to make donations, and 11% of businesses (84,000) had not considered making donations. Figure 3 graphs responses to this question.
A similar pattern for barriers was identiﬁed through questioning regarding community business projects and sponsorship.
Figure 3: Barriers to making any/more donations
5.2 Planned giving
A popular view of giving by both individuals and business is that it is spontaneous; a response to some tragedy, or a recognition that some person or group has a pressing need. Yet, fundraising and most fundraising organisations try to build a commitment to giving. The newly emerging discourse of social investment tries to persuade people that their giving requires as much attention, as much planning, as their other investing decisions, such as for retirement.
In response to the Individual and Household Survey, the majority of respondents indicated that they had been providing support to a particular organisation for ﬁve or more years. They were also asked if they had made one or more donations to that organisation over the past year. In 51% of cases organisations had received a one-off donation while, in 48% of cases the donor had made several donations to the organisation.
Respondents were asked if their donation was planned or spontaneous. Just over 50% were described as spontaneous, while just fewer than 16% were described as planned. Almost 31% were a mixture of both.
When looking at the amounts given, the average amount donated to the chosen organisation when the gift was described as planned was $238 and the average gift described as spontaneous was $59. The demographics of planned giving show a small increase in likelihood that the donation was planned among those over 65, those with a university degree and those in managerial and professional employment, but the differences were barely signiﬁcant.
Bequests are sums of money or of shares, goods or property bequeathed to a living individual or organisation by a will. It was not possible through the Survey of Nonproﬁt Organisations to estimate the amount received through bequests because no reliable sample of nonproﬁt organisations is available. It is not possible to estimate the value of a bequest in advance, as the value of an estate can never be known until the death of the person leaving the bequest. There are no reliable annual or other estimates of the value of bequests received by nonproﬁt organisations.
We do know that bequests are an important source of funds for nonproﬁt organisations. Charity researchers Givewell surveyed 406 nonproﬁt organisations and found 220 (54%) had received bequests to the value of $140 million in 2003-04 (Givewell, 2005). The survey of 481 nonproﬁt organisations conducted for Giving Australia found that bequests were nominated as the most signiﬁcant source by 9% of responding agencies, the third highest ranked fundraising practice from among 24 practices listed.
Respondents through the Individual and Household Survey were asked whether they had made a will and whether they had made a bequest to any charity or other nonproﬁt organisation in that will. An estimated 58% of the adult population have made a will and of these 7.5% have included in their will a bequest to a charity or other nonproﬁt organisation. Not surprisingly, the likelihood of having a will increases with age. However, the likelihood of a person who has drawn up a will leaving money to charity increases only marginally with age.
Foundations and Trusts
Philanthropic entities are important intermediaries for giving – they span giving across the generations, often through bequests establishing foundations or trusts, and as an organised conduit between givers and recipients.
The Australian Directory of Philanthropy (Philanthropy Australia, 2004) lists more than 370 philanthropic entities in Australia. Lyons and Hocking (2000) were able to collect data about 158 philanthropic entities that in total expended $82.1 million.
Since the 2000-01 year, taxation law in Australia has provided for the formation of prescribed private funds (PPFs). A PPF is a fund established by a will or trust instrument with Deductible Gift Recipient (DGR) status. Previously, DGR charitable funds were public funds only and were required to seek and receive donations from the public and be strictly controlled by members of the public.
McGregor-Lowdes and Marsden (2003) have noted that the numbers of PPFs have grown rapidly. At 30 June 2001, 22 PPFs had received $78.6 million in donations and at 30 June 2002, a total of 81 PPFs had a total of $135.1 million under investment for future distributions to other DGRs. Around 300 PPFs have now been established. PPFs have had a signiﬁcant effect on the nature and extent of tax-deductible giving in Australia (CPNS, 2005).
Qualitative research for this project among wealthy individuals and those involved in foundations and trusts identiﬁed a number of themes. These included:
- Inspired by the opportunity to seed ideas. Trusts, foundations and PPFs were motivated to fund strategic, systemic change and ‘between the cracks’ projects and build for the long term.
- Newer entities need more support. It was generally observed that newer foundations or trust entities needed more support and had little awareness of existing training opportunities and networks. Key issues for newer trusts were clarifying mission and focus, handling applications, publicity, and deciding on allocations.
- Challenges for older trusts. These were expressed as including interpreting founder’s wishes, being leaders and partners in their grant making to nonproﬁt organisations, and linking with other grantmakers where possible.
Business Foundations and Trusts
The Survey of Business found that 1% of businesses, a total of 7,000 businesses, operate a foundation or trust for the purpose of making donations.
There are 4,700 businesses with 1-10 employees that operate a foundation or trust for the purpose of making donations. However, businesses with 11 or more employees are relatively more likely to operate a foundation or trust. In fact, of businesses with 11 employees or more, 3% operate a trust or foundation, compared with less than 1% of businesses with 1-10 employees. Some 4,100 businesses in Cultural/Recreational Services operate a foundation or trust of this type and they are most likely of all businesses to do so.
Taxation Measures and Awareness
Taxation is both a measure to provide ﬁnancial incentive for giving as well as a means by which giving can be measured by the community and, for individuals and businesses, provides a framework for planned giving. Of course, those who pay a higher marginal rate of tax receive a greater incentive. Wealthier individuals are donating more and more often (Giving Australia, 2004) and so such tax measures are increasingly important.
The Individual and Household Survey inquired of informants whether they had claimed any deductions for donations in their 2003-04 tax return. Thirty-six percent replied in the afﬁrmative, and recalled claiming a total of $1.64 billion, higher than would be expected by projecting the Australian Taxation Ofﬁce’s ﬁgures. This estimate for tax deductible giving suggests that about one in four of all donations made by individuals is claimed. Presumably the remaining three-quarters of individual donations to nonproﬁt organisations is either claimable but not actually claimed, or comprises giving to nonproﬁt entities that are not deductible, such are religious institutions.
Table 15 below sets out, for demographic and employment variables, the percentages who report they claimed a tax deduction. It also sets out the mean size of the donation they made in the survey period and for comparison, the mean donation made by those not claiming a deduction. It must be noted that the mean donation made by tax claimers is not the amount for which they claimed a deduction: the amount reported as claimed for deduction was for the 2003-04 tax year, while the amounts reported here are for 2004; as well, many donations are not claimable. The last two columns indicate that those who claim tax deductions give more. The table makes it clear that those who made tax claims are predominantly drawn from high-income earners and they make higher than average donations.
NON TAX CLAIMERS
|Personal income||Nil to $15,599||18.1||523||200|
|$15,600 to $31,199||33.4||455||275|
|$31,200 to $51,999||42.0||664||427|
|$52,000 and higher||56.3||1,334||574|
|Household income||Nil to $25,999||17.0||442||216|
|$26,000 to $51,999||36.3||593||314|
|$52,000 to $104,00||45.1||718||398|
|Education||School level only||27.6||463||249|
|Employment status||F/T paid employment||46.8||681||321|
|P/T paid employment||38.0||452||304|
|Unemployed looking for work||15.7||326||141|
|Not retired and not in workforcer||21.3||642||248|
|Occupation||Managers and professionals||50.9||845||412|
|Other white collar||33.8||517||278|
|Other blue collar||23.1||380||235|
One way in which people give is via a regular deduction from their pay. This involves employers deducting the donation and passing it onto the nominated charity. Because it requires a commitment to nominate a certain charity, it is an example of planned giving. To encourage such methods of giving, two years ago the government allowed employers 38 Giving Australia: Research on Philanthropy in Australia | Summary of Findings to adjust an employee’s tax to recognise the value of the donation. In that way the donor gained the tax benefit they were entitled to at the time of making the donation, rather than later.
Of our sample, 0.7 % said their donation was made as a deduction from their pay. This suggests around 100,000 people who participate in such schemes9. These donors tend to be men (52%), in full time employment (64%) and earning over $52,000 annually (17%). Most (70%) live in capital cities, but a few (30%) are based in rural areas, possibly reflecting the use of such schemes by some large mining companies.
Individual awareness of tax incentives
Table 17 below identifies that of the 19% of all respondents in the Individual and Household Survey who indicated that they were aware of tax changes to encourage giving, nearly half were aware of this new workplace giving tax measure, ie about 9% of all respondents.
Since 1999, the Australian Government has made a number of other changes to taxation law to encourage giving, especially by high income/high wealth individuals. These include the availability of deductions for donations of property and for some of the costs associated with attending fundraising dinners and similar events, the right to spread deductions over five years and the right to claim deductions for donations to private charitable funds. The survey sought to discover the level of awareness of these changes, and whether they had had an impact. Nineteen percent of the sample was aware of changes, although some changes were better known than others. Table 16 below indicates the level of awareness of different changes (note that the percentages are of those 19% of respondents who said they were aware that there had been some changes).
|% AWARE (N=2,904)|
|Deductions are now available for donations to private charitable funds||63.3|
|Giving which allows regular donations through pay to receive tax beneﬁts immediately||46.5|
|Deductions are now available for attending fundraising dinners or similar events||34.9|
|Gains tax exemptions are now available||29.6|
|Deductions are now available for some property donations||23.7|
|Can be spread over 5 years||21.4|
This awareness was spread fairly evenly across demographic and occupational groups. It was noticeably higher among university graduates, and among higher income earners. Importantly, the average size of donations made by those aware of tax changes was signiﬁcantly higher than donations made by those who were not aware. However, far fewer claimed that the changes had any impact on their giving. Only 1% of total respondents or 7% of those who were aware of changes indicated that it had had an impact on their giving.
Business awareness of tax changes
The Survey of Business found that of all businesses 30% allow employees to make pretax regular donations to non-proﬁt organisations through their pay. Of this group 4% of businesses offer a company matching scheme (eg dollar for dollar) for payroll deductions to non-proﬁt organisations.
The proportion of businesses allowing employees to make donations through their pay was above average in Education and Health and Community Services industries, but below average in Transport/Storage, Utilities and Retail Trade businesses.
Despite a high proportion of businesses in Education and Health/Community Services allowing employees to make donations through their pay, very few of these businesses offered a company matching scheme. Company matching of donations was above average among Construction businesses.
When asked, 301,300, or 39% of businesses, said that they encourage their employees in some way to give their money, time or services to not-for-proﬁt organisations or charities. The main ways were circulating information on local charities through the organisation (167,300 businesses or 22%), ﬂexible work hours to accommodate unpaid volunteering (150,800 businesses or 19%) or paid time off to volunteer (34,200 businesses or 4%). Some businesses encouraged their employees in more than one way.
Of all businesses 63% were aware that there are tax concessions for payroll deductions by staff to DGR organisations.
Awareness of these tax concessions was greater among larger than smaller businesses, and more common among Transport/Storage, Health/Community Services, Cultural/ Recreational Services and Education industries. Awareness of these tax concessions was below average in the Electricity/Gas/Water industries and in Accommodation/Cafes/ Restaurants.
Awareness of tax concessions for establishing a private foundation/trust that has been prescribed in tax regulations was found among 43% of all businesses.
Awareness of tax concessions for establishing a private foundation or trust was higher among Transport/Storage businesses and among Health/Community Services. Awareness of these concessions was relatively low among Education organisations and businesses in Accommodation/Cafes/Restaurants.
5.3 Approaches used for giving: attitudes and effectiveness
To raise funds, nonproﬁt organisations need to approach people to give. McNair Ingenuity has found a strong correlation between the number of approaches to people to donate and frequency of donating (Giving Australia, 2004). Yet the frequency with which people and businesses are approached to give, their actual giving in response to particular forms of approach and their attitudes to these vary considerably.
The Individual and Household Survey asked people their experiences and attitudes regarding ways they were approached to give. Except in the case of major disasters such as the Asian Tsunami appeals, people rarely give unless they are asked. Organisations seeking donations have a variety of ways of asking people for gifts. Some are direct, such as telephone appeals to strangers, others are less direct, such as using known donors or people who volunteer for the organisation to ask friends or work colleagues to donate.
Some ways are more successful than others at eliciting a donation. Some are not universally liked; their overuse may damage the reputation of a fund raising organisation or all fundraising charities.
The tables below set out six of the most common fundraising methods and, for each method, records the number of people who recalled being approached. Subsequent tables indicate the frequency of giving in response to this approach and attitude toward the approach.
|% OF SAMPLE
|NUMBER OF PEOPLE
|Telephoned at home||77.3||11,907|
|Television advertisement or program||69.3||10,670|
|Request through mail/letterbox||65.9||10,147|
|Approaches door knock appeal||61.1||9,408|
|Street or public place||59.8||9,204|
|Advertisements or ﬂiers in magazine/ newspaper||51.9||7,985|
Table 17 shows that the most frequently reported approach, being telephoned at home, is also the most disliked. Although it is not the most successful at eliciting a donation, such telemarketing is far from the least successful. Door knock appeals are not as frequent, but are less likely to be disliked and far more likely to elicit a donation.
|NOT AT ALL
|Telephoned at home||2.2||7.4||31.9||58.3||77.3|
|Television advertisement or program||0.5||1.3||13.9||84.0||69.3|
|Request through mail/letterbox||1.6||3.9||28.7||65.4||65.9|
|Door knock appeal||22.9||24.5||35.2||17.0||61.1|
|Street or public place||5.1||16.1||44.2||34.3||59.8|
|Advertisements or ﬂiers in|
|HAPPY TO BE
|% TOTAL SAMPLE
|Telephoned at home||77.8||10.4||10.6||77.3|
|Television advertisement or program||16.4||42.7||38.6||69.3|
|Request through mail/letterbox||32.7||34.3||31.8||65.9|
|Door knock appeal||21.6||21.9||55.3||61.1|
|Street or public place||41.8||20.8||36.2||59.8|
|Advertisements or ﬂiers in
Qualitative research among individuals tended to reinforce these quantitative ﬁndings. These ﬁndings include:
- Invasive techniques were slammed. These were seen as tainting not just the nonproﬁt organisation involved but the sector itself. It mainly occurred in relation to telemarketing and street asks by commission/paid canvassers but was less of an issue for previous donors to an organisation and if volunteers were asking.
- A range of likes and dislikes. Direct mail was seen as acceptable, though sometimes a waste of money while unaddressed mail was ignored. Face to face solicitation by volunteers was more accepted if clear signage and non-aggressive behaviour was used.
- Advance promotion helps. All approaches were more trusted if promotion in the marketplace had informed people they were coming, and were considered legitimate. However, supporters needed to know the organisation and be positive about it for more than token support to occur.
The Survey of Business asked how businesses were approached to make donations and their reactions to these approaches. The ﬁndings, summarised by form of approach, are given below and detailed in Table 20.
- Telephone call. This form of approach was the most commonly used, was fairly effective in terms of making a donation and was among the least preferred.
- Form or letter. This was also a quite common form of approach, also fairly effective and was the most preferred.
- Form or letter with additional materials. This was not so common a method, was modestly successful and not so preferred.
- Request from an employee or director nonproﬁt organisation. This was infrequently used, but modestly successful and not so preferred.
- Email. This was an occasionally used method of approach, the least successful and not preferred.
- Request from a client or supplier. This was an occasionally used method, somewhat successful and not particularly preferred.
|APPROACHED||MADE A DONATION||PREFERRED|
|Form or letter||420,300
|Form or letter with additional materials
such as cards or booklet
|Request from an employee or director
involved with the beneficiary organisation
|Request from a client or supplier
that you already deal with
|None of the above||60,600
5.4 Resources and issues for strengthening nonproﬁt organisations
This section identiﬁes issues associated with the marshalling of resources for strengthening nonproﬁt organisations. Key components summarised are those of qualitative research among nonproﬁt organisational personnel and the Survey of Nonproﬁt Organisations.
The Survey of Nonproﬁt Organisations as part of this project collected responses from almost 500 nonproﬁt organisations. While its ﬁndings cannot be quantiﬁed to and presented as representative of the entire sector, its ﬁndings are broadly relevant and indicative. That survey looked at the:
- extent to which nonproﬁt organisations secured resources via fundraising, partnerships with business, commercial ventures and volunteer recruitment
- types of resources and support that nonproﬁt organisations use to assist them when undertaking these activities and how useful they ﬁnd them
- reasons that nonproﬁt organisations do not undertake activities such as fundraising, partnerships, commercial ventures and volunteer recruitment
- factors that would improve the organisational capacity and ability of nonproﬁt organisations to undertake activities.
The pattern of resource mobilisation
Overall, the ﬁndings suggest that the nonproﬁt organisations that responded to the survey are active in a wide range of resource mobilisation activities. In the 2003-04 ﬁnancial year most nonproﬁt organisations (80%) were active in terms of fundraising. Of the wide range of fundraising practices available to nonproﬁt organisations, bequests and major gifts, marketing, events and personal solicitation are the most extensive. The key types of fundraising activities in terms of revenue generation include special events, direct mail, bequests and grants from foundations.
The majority of nonproﬁt organisations in the study were aware of tax incentives relating to workplace giving and prescription of private charitable funds as deductible gift recipients (DGR). Fewer respondents were aware of the other incentives relating to tax deductibility and capital gains tax exemptions.
Almost three-quarters (72%) of the nonproﬁt organisations in the study had attempted to recruit volunteers in the 2003-04 ﬁnancial year. Nonproﬁt organisations that had either a paid or unpaid manager or coordinator of volunteers were more likely to have undertaken recruitment compared to all organisations with volunteers. Similarly, organisations that were active volunteer recruiters were also more likely to use formal contracts or agreements with their volunteers, have formal volunteer training and recognition programs and had experience with employee/corporate volunteering compared to all organisations with volunteers.
Almost two-ﬁfths (39%) of the nonproﬁt organisations in the study had at least one partnership with a business organisation. The majority of partnerships were between 1 and 5 years’ duration with a sizeable minority (20%) indicating their partnerships were ongoing. The ﬁndings suggest the predominance of ‘philanthropic’ as opposed to ‘transactive’ or ‘integrative’ styles of community business partnerships, as they primarily consist of ﬁnancial or product contributions from business with only less than one-quarter of partnerships having an employee volunteering component.
Over one-quarter (29%) of nonproﬁt organisations in the study operated a commercial venture or social enterprise. In the overwhelming majority of cases (87%) the venture was an extension of services that organisations provide as part of their primary purpose and mission.
Factors inﬂuencing the pattern of resource mobilisation
Some of the key factors that appear to inﬂuence resource mobilisation behaviour among the nonproﬁt organisations in the study include:
- Organisational size. The likelihood of nonproﬁt organisations undertaking fundraising, volunteer recruitment, partnerships or commercial ventures increases with size. This is especially the case for partnerships and commercial ventures. Furthermore, smaller organisations are less likely to engage in multiple resource mobilisation activities (e.g. fundraising, volunteer recruitment and partnerships) compared to larger organisations.
Size not only plays a role in terms of the likelihood of an organisation undertaking fundraising, but also in the number of different types of fundraising activities it undertakes. Smaller organisations, for instance, are more likely to rely on fundraising revenue from gaming and less likely to rely on revenue from bequests/major gifts and events compared to larger organisations. Larger organisations are more likely to fundraise via bequests/major gifts, marketing, events and personal solicitation. Smaller organisations also tend to utilise fewer types of fundraising practices compared to larger organisations.
Organisational size also inﬂuences the number of partnerships that nonproﬁt organisations have with business, with larger organisations more likely to be more active than smaller organisations in terms of the number of business partners.
- Industry (ﬁeld of activity). The nature of the data does not allow ﬁrm conclusions to be drawn with respect to the inﬂuence of industry (ﬁeld of activity) on resource mobilisation. Nevertheless, the ﬁndings do suggest that organisations in some industries, for example community services and health, are more likely to undertake certain types of activities such as partnerships compared to organisations in other industries.
- Primary purpose. Nonproﬁt organisations whose primary purpose is public, rather than member serving, are more likely to have undertaken volunteer recruitment, have partnerships with business, fundraise and operate a commercial venture compared to member serving organisations.
- Geographic location. Nonproﬁt organisations based in capital cities are more likely to undertake fundraising, volunteer recruitment and have business partnerships compared to those in large regional centres. Organisations from rural and remote areas appear to rely more on fundraising and volunteer recruitment than to have partnerships with business or to operate commercial ventures.
- Age. Older nonproﬁt organisations are more likely to undertake fundraising, volunteer recruitment and operate a commercial venture compared to organisations that were established in the last 15 years.
- Geographical scope of operations. Nonproﬁt organisations that are international in scope are much more likely to fundraise, recruit volunteers, have partnerships with business but less likely to operate commercial ventures. Organisations that are national in scope are most likely to have a partnership with business compared to all other organisations. In contrast, organisations that are local in scope are least likely to have a partnership with a business organisation.
The study found that nonproﬁt organisations draw upon a wide range of resources, support and assistance in generating resources via fundraising, volunteers, partnerships and commercial ventures. Some types of supports appear to be used to a greater extent across all or most types of activities. This was especially the case for:
- volunteers, including those that serve on their boards or management committees
- paid internal staff
- advice from the Board or a particular board member
- information and support from not-for-proﬁt support organisations.
Other types of resources and supports that appeared to be relatively highly used included:
- the services of a paid or unpaid manager or coordinator of volunteers
- radio advertisements for volunteer recruitment
- gaining information from books and manuals
- gaining information from the internet
- attending courses and training seminars on relevant topics
- using an external consultant
- seeking the advice of another CEO.
Organisations generally indicated that they found these types of support and assistance to be very useful. This was especially the case for paid internal staff and volunteers, including those that serve on their boards and management committees. The degree of usefulness of different types of support and assistance varied according to the type of resource mobilisation activity.
Reasons for lack of activity
Not all of the nonproﬁt organisations in the study were involved in either fundraising, volunteer recruitment, partnerships or commercial ventures. Some of the reasons for this were similar across all four types of activities. For instance, between one-quarter and one-half of the nonproﬁt organisations indicated they did not undertake activities because they had no need to raise extra revenue or volunteers, form a partnership with business or operate a commercial venture.
Another signiﬁcant reason why organisations did not undertake one or more of the activities was a lack of ﬁnancial and human resources. This was particularly the case for fundraising, volunteer recruitment and partnerships. This suggests that there is still a lack of knowledge about how to form partnerships with business among nonproﬁt organisations, one-third of those organisations that did not have a partnership with a business organisation stated that they would like to engage in a partnership but were not sure how to go about it.
The ﬁndings also indicate that the reasons nonproﬁt organisations do not engage in resource mobilisation activities are generally not due to a lack of support for the concepts of partnerships or commercial ventures or because their boards are risk averse. Rather, the ﬁndings suggest that nonproﬁt organisations require additional resources to undertake resource mobilisation activities.
Improving organisational capacity
Nonproﬁt organisations that had undertaken one or more of the four resource mobilisation activities indicated that a key factor that would increase their capacity in the future was having increased ﬁnancial resources. Having more human resources, such as paid staff and fundraising volunteers, was also seen as an important factor that would improve organisational capacity.
While ﬁnancial factors were also seen as relatively important in increasing organisational capacity for nonproﬁt organisations that had not undertaken one or more of the four main activities, a slightly different pattern emerged. These organisations were more likely to indicate that ﬁnancial and human resources as well as ‘knowledge’ factors, such as having a greater understanding of how to undertake some of the activities, as being important to improving their organisational capacity in the future.
In other words, those organisations that are already undertaking resource mobilisation activities have in the main jumped the ‘knowledge’ hurdle and need more ﬁnancial resources to continue to increase their capacity. They have experience and commitment to seek more resources, but need even greater capacity to build on this.
For those organisations that are not undertaking resource mobilisation activities, greater ﬁnancial resources would certainly be desirable but they still need to gain greater knowledge and expertise of how to undertake particular activities.
A number of key issues were raised by nonproﬁt personnel through in-depth interviews and focus groups conducted in support of this research. These are presented below under two broad headings of internal and environmental issues.
Key environmental issues raised by personnel from nonproﬁt organisations included:
- Rising costs of compliance and risk management. These demands arose across all entity sizes, but most acutely for small nonproﬁt organisations. Compliance issues included those associated with governance, qualiﬁcations for service delivery, accreditation, onerous evaluation and reporting on contracts and grants, and especially for some, GST. Key risk management challenges raised were those of public liability, and insurance risks inﬂuencing adversely the preparedness of nonproﬁt organisations to engage volunteers.
- Issues in working with governments. Many felt that government funding was declining at a time when too few alternate sources of ﬁnancial support or skills to access government funding were available. Concerns about funding from governments included fewer dollars over shorter periods, inadequate adjustments for rising costs and little or no funding for infrastructure. Differences between state and national legislation applying to nonproﬁt organisations were commented upon and it was noted some felt these were complex, sometimes inconsistent and not always suitable. Some indicated that no reasonable legislative framework for transparency applies to nonproﬁt organisations. Poor coordination between government funding ‘silos’ and little valuing of nonproﬁt experience were mentioned. Governments were viewed as risk averse and perceived as pressuring nonproﬁt organisations not to advocate on behalf of disadvantaged groups.
- Opportunities from private rather than government sources. Opportunities, including from private foundations, for business partnerships and fees for services were identiﬁed. Government encouragement of private sector giving was seen as highly desirable (eg. community business partnerships) – a lot of untapped philanthropy was felt to exist. While positive attitudes were expressed about such partnerships with business, this was qualiﬁed by feelings that they are difﬁcult to start and manage. There was a benign view that tax measures for giving might help.
- Importance of credibility and transparency; concern about their costs. Concerns were expressed that the nonproﬁt sector was unable, unlike business, to pass on costs to clients in part because of a lack of public understanding of the costs of running an organisation. Some expressed the view that while ensuring transparency was favoured, it was noted with concern that this may have a negative impact on giving to speciﬁc organisations or to the nonproﬁt sector generally. These concerns seemed to contribute to short-term survival strategies with little future planning. It was felt that credibility needed to be (re)built as it has been affected by the taint of a few ‘bad apples’ highlighted in media reports and by the aggressive and offensive approaches of some.
Key internal issues raised included:
- Need for leadership. It was felt that leadership was needed at all levels – sector-wide, board and CEO. It was felt this could improve the capacity to address ﬁnancial problems and allow for organisational and environmental problems to be addressed.
- Need strategic fundraising. Personnel speciﬁcally made mention of the need for stronger branding and closer donor relationships amidst stiffening competition.
- Attracting, retaining and training fundraising personnel. This was seen as a real challenge. Key issues were seen to include a lack of training (especially in regional areas, or for learning how to attract business support), the need for more single-cause support networks (which could also help with tailored training), and that the profession was not attractive to many and often held in poor regard by the community, including other nonproﬁt personnel. A related issue is the discomfort level of donors concerning perceived high nonproﬁt salaries and beneﬁts.
- Greater commitment needed to HR development. Many current education and training efforts were applauded but, it was felt, more conferences, seminars, templates and best practice guidelines were needed.
- Need for more ﬂexible volunteering opportunities. Traditional recruitment practices, time commitment and activity use of volunteers were viewed as being less appropriate for new volunteer groups such as young people and baby boomer retirees. It was considered that there was signiﬁcant untapped volunteer capacity while some felt volunteers were treated poorly.
- Needs of smaller and regional nonproﬁt organisations. Small nonproﬁt organisations felt they were limited in fundraising, but were desperate to learn more. The capacity of personnel was often limited and the costs of accessing training high. A need for innovation was expressed. Donor and volunteer fatigue issues exist in smaller states and areas which are tapping repeatedly into small pools of strong, local and loyal networks.
- Cynicism. This was evident in some groups regarding capacity support programs from government. Some nonproﬁt personnel felt threatened by prescribed private funds taking money that may have ﬂowed earlier and directly to them.
- Related to this research McNair Ingenuity has found that unprompted awareness of well known nonprofit organisations correlates strongly with a likelihood to give (Giving Australia, 2004).
- Because these are such small numbers, the 95% confidence range is from 74,000 to 140,000.
A diverse and healthy nonproﬁt sector contributes to a stronger, more prosperous and cohesive civil society.
This research has been unique, comprehensive and integrated. It has occurred with the support of the Australian Government, and with the active involvement of many people from a range of nonproﬁt organisations, academia and business organisations.
Over recent years Australia has beneﬁted from a large growth in giving, in all its forms, by individuals and business. This growth seems to have been the result of many factors including the growth in the Australian population and general economic prosperity. It has also resulted from the efforts of many nonproﬁt organisations, which have become more effective in their efforts to secure resources from within the community.
Furthermore, the Australian Government has implemented a number of measures to strengthen the sector, including through taxation reform to provide incentives to individuals and businesses to provide more support for the nonproﬁt sector, as well as other initiatives aimed at encouraging and promoting individual and corporate social responsibility in Australia.
The results of this research also highlight a number of challenges facing the nonproﬁt sector, which will need to be addressed to maintain the sustainability of the sector. It is up to all of us—individuals, government, business and the nonproﬁt sector itself—to play our part.
Australian Bureau of Statistics (2001) Voluntary Work Australia Cat No 4441.0. Canberra: Australian Bureau of Statistics.
Australian Bureau of Statistics (2002a) Non-Proﬁt Institutions Satellite Account Cat No 5256.0. Canberra: Australian Bureau of Statistics.
Australian Bureau of Statistics (2002b) Generosity of Australian Business Cat No 8157.0. Canberra: Australian Bureau of Statistics.
Australian Bureau of Statistics (2003) General Social Survey. Summary Results Australia Cat No 4159.0. Canberra: Australian Bureau of Statistics.
CPNS (2005) Current Issues information Sheet 2005/7 Tax Deductible Giving in 2002-03 QUT Centre of Philanthropy and Nonproﬁt Studies, Brisbane.
Giving Australia (2004) Summary of Key Data The Australian Government Department of Family and Community Services and ACOSS. Sydney.
Givewell (2005) Australian Giving Post-Tsunami: Australian Charities Financial Analysis 2004. Evans Head: Givewell.
Hall, M., McKeown, L. and Roberts, K. (2001) Caring Canadians, Involved Canadians: Highlights from the 2000 National Survey of Giving, Volunteering and Participating. Ottawa: Statistics Canada.
Lyons, M. and Hocking, S. (2000) Dimensions of Australia’s Third Sector. Lindﬁeld: CACOM, UTS.
McGregor-Lowdes, M and Marsden, S (2003) CPNS Working Paper 27 - An Examination of Tax-Deductible Donations Made by Individual Australian Taxpayers in 2001-02. QUT Centre of Philanthropy and Nonproﬁt Studies, Brisbane.
National Roundtable of Nonproﬁt Organisations (2003) The Nonproﬁt Sector in Australia Philanthropy Australia. Melbourne.
Philanthropy Australia (2004) The Australian Directory of Philanthropy 2004/2005 Philanthropy Australia. Melbourne.
United States Department of Labor (2002) Volunteering in the United States Summary. Washington DC: Author.
Volunteering Australia (2005) Volunteering in Australia Volunteering Australia. Melbourne.