Why Endow the Annual Campaign? Or “How Did they Do That?”

Little else besides federation missions seems to produce a desire by the next generation to give in great numbers to an umbrella campaign supporting local, national and international agencies.

endowmentBy Joseph C. Imberman

“We hold these truths to be self evident” … just as one of the great speeches of our nation makes its truths clear to the listener, those of us who have been insiders in the world of Jewish federation philanthropy see the need to continue the role and the strength of our annual campaign as our most important objective. There is only one problem with this statement. The campaign has relied for its strength on larger and larger gifts from a smaller and diminishing group of aging and committed donors over a long period. Despite our greatest efforts to involve next gen donors and women as well as the major giver we find that each year we grow by 1-3 % in receipts only. Ironically some of our oldest truths seem to continue – those who participate in federation missions seem to give at a higher level than they did before or in relation to their peers as donors. But little else we seem to do produces a desire by the next generation to give in great numbers to an umbrella campaign supporting local, national and international agencies.

For the last 5-8 years we have seen the growing influence of a legacy program which has as its biggest objective nothing less than the endowing of each local Jewish community. In some communities CJL (Create a Jewish Legacy) as we call (or Life and Legacy as the Harold Grinspoon Foundation calls it) has even eclipsed the Lion of Judah endowment program in visibility. Why is this important? Endowment, or the hidden idea behind the fund raising objectives of our resource development activities is finally becoming a more accepted concept for leaders of Jewish charities. Over a period of 10-15 years, even a small number of private foundations have gotten into the game, using their own unrestricted dollars to “make a good investment” as Harold Grinspoon has said or as Stanley Bushman of Kansas City has done. And they follow the earlier efforts of big foundations like Kresge which saw the wisdom of challenging charities to raise dollars for endowment 20 years ago. All have put their money where they really see a benefit … helping local charities to match dollars committed for endowment and in doing so helping to insure the financial health of the charity and the constituencies it serves. Imagine a world in which 50% of the operating budget of the organization you serve comes from endowment resources or donor advised funds?

In the world of federation philanthropy, the annual campaign sustains us but in many cases when the campaign begins it can do so with up to 10-15% transferred literally “at the push of a button” from permanent gifts held locally by the federation or local foundation. Some communities are claiming up to 30 or even 40% of the annual campaign’s operating revenues are coming from “endowment” (including donor advised fund) sources.

Raising significant endowment for the annual campaign allows the community to do many other things with its resources (both capital and programmatic) and to stress less about changes to the demographics or giving habits of its donors. To have the ability to generate this kind of ongoing resource from major donors in the community several key variables have to come together:

Institutional and Personal

  • Trust in the community’s expertise at financial management and investment
  • Belief that the current and past leadership of the community have its best interests at heart
  • Commitment by senior leadership to providing budget support for long term financial revenue development activities
  • Attention to the investment objectives of the endowment program
  • Excellent management of the image and activities of the charity in relation to its mission
  • Asking for the gift and reminding donors of its importance
  • Thinking about the annual campaign as an endowable institution
  • Connection by the donor to the lead staff and volunteer leadership of the charity
  • Local professionalization of the staff to non profit managers with a panoply of skills.

What are the actionable steps here?

  • If you are in a senior management position look at your resource allocations within financial resource development.
  • If you are a campaign leader look at the internal balance between annual campaign and endowment
  • If you are a marketing executive how can you burnish the image of the charity in such a way as to make longer term donors out of annual donors?
  • If you are the CEO are you thinking about who is leading your long term development efforts?
  • Finally if you are the Endowment executive what are you doing to build the business plan of your unit?

Until recently, Joseph C. Imberman was Associate Vice President, Planned Giving and Endowments at the Jewish Federations of North America (JFNA). He now manages a consulting practice for endowments and foundations and acts as Senior Advisor to the Montreal Jewish Federation (FCJA).For more information contact Joe Imberman at Joe.Imberman@gmail.com or JosephImberman.com.