Expressing Gratitude: Writing a Donor Recognition Policy
To launch a successful fundraising program, an organization should have created a number of documents including the Case for Support, Gift Acceptance Policies and Procedures, and a Donor Recognition Policy. The Case explains “why” you are raising money, the Gift Acceptance Policies delineate what constitutes an acceptable gift and under what circumstances your organization will accept the donation, and the Donor Recognition Policy explains how you will express gratitude to the donor.
The purpose of the Donor Recognition Policy is to ensure that those who support the organization through donations receive recognition that is appropriate, equitable, and consistent. The Policy is developed with the attitude that all gifts are important; that nurturing each donor is the business of the organization; and that a monetary gift is never more important than individual relationships.
Through the Donor Recognition Policy, the organization hopes to:
Cultivate relationships with existing donors and encourage them to reach higher levels of giving
Attract new donors
Ensure that, in fairness to donors to the organization, one clearly stated policy of recognition is applied at all times
Items to be addressed in writing a Donor Recognition Policy include:
The Policy needs to address the confidentiality of donations;
How the Policy will be explained to donors;
A clear definition of the types of gifts the organization will accept. This will include: how pledges will be managed; special event participation; real estate; planned gifts; and corporate matching gifts;
A table that demonstrates giving levels and the recognition to be afforded each level;
If cumulative giving is to be recognized separately, then a table defining the cumulative giving program needs to be created;
How to manage gifts that may require special consideration such as tribute gifts, in-kind gifts, and capital or endowment gifts.
Most organizations may create a separate recognition policy for a capital campaign or for legacy gifts. Another consideration is recognition of donor advised funds. These have become significant transactions in the past decade and need to be managed appropriately to keep the donors and IRS happy.
A Donor Recognition Policy must have board approval and once adopted shared with your major stakeholders. Through sharing the Donor Recognition Policy, the organization will increase the level of confidence of the board, volunteers, donors and staff in the organization and will help raise more money.
The policy should be reviewed and updated every two or three years. I feel confident in stating that the majority of organizations that have donor recognition policies have yet to incorporate either donor advised funds or cryptocurrency into their policy.