# COVID-19 crisis: next steps for corporate, philanthropy and trust fundraisers

- Link: https://fundraising.co.uk/2020/04/29/covid-19-crisis-next-steps-for-corporate-philanthropy-and-trust-fundraisers/
- Published: 2020-04-29T10:27:16+01:00
- Author: Howard Lake

**In any crisis people move through various phases of response. Initially the focus
is all on short term measures. There then comes a point when the focus needs to 
shift from the short term urgency onto the strategic priorities.**

 

The question for fundraising leaders, and especially those looking at corporate,
trust and philanthropy income is: how do I balance the short term need for cash 
with the long term imperatives? This is important because income from corporates,
trusts and philanthropists has a typical payback period of 12-18 months i.e. effort
now delivers returns a year to a year and a half down the track.

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Clearly short term funding opportunities should be sought out. However, if the research
effort, pipeline building, and cultivation work is totally parked then this is setting
a charity up for a hole in income 12-18 months from now. So the questions are: what
actions should be taken to ensure there is still focus on targeting future income?
What is the likelihood of that future income being hit by recession?

 

 

 

## What can we learn from previous economic shocks?

 

Over the last week or so many people have been asking what fundraisers can learn
from past economic shocks. Lots of charities are looking back at the global financial
crisis (GFC) and seeking insight that can inform their actions in response to the
current crisis.

 

The first thing to say in relation to the GFC is that, whilst there are some learning
points that we can take from that crisis, and the resulting recession, it is not
a like for like comparison. The GFC saw six straight quarters of economic contraction
in the UK. This was the worst recession since the war.

 

The COVID-19 crisis a different beast: a sharp and sudden shut down of the almost
the whole economy. So this is leading to a bigger and more immediate drop in GDP
but probably only for a short period (see below for some useful resources for tracking
recession impact).

 

In terms of high value income, here is a three bullet summary of what happened after
the GFC:

 

• Major donor income largely held up, in fact some donors increased giving (source:‘
Tomorrow’s Philanthropist’ Barclays Wealth, July 2009)

 

• Trusts income took a hit as investments lost value due to stock market falls, 
but then income recovered relatively quickly (NCVO Civil Society Almanac 2017)

 

• Corporate income took a hit and then remained fairly flat (NCVO Civil Society 
Almanac 2017). (NB – the GFC hit the banks and finance companies hard and the finance
sector accounts for a big portion of corporate giving in the UK)

 

Below is a snapshot slide summarising the GFC:

 

 

 

![Chart showing snapshot of the global financial crisis - source: Grahame Darnell](
https://wfay6x.infiniteuploads.cloud/2020/04/snapshot-global-financial-crisis-grahame-
darnell-1024x767.jpg)

_Snapshot of the global financial crisis (2001-2016) – source: Grahame Darnell_

 

 

 

When considering the likely impact of the current crisis it is important to think
look at your income mix. Travel, retail and food services businesses will be hit
very hard by this crisis. Businesses in these sectors, or philanthropists that are
connected to these businesses, may well reduce their charitable support in the short
to medium term. Some will go out of business altogether.

 

The finance sector, and other services businesses such as law, IT and consulting
should not be hit as hard as those aforementioned sectors.

 

Of course you should treat every company and philanthropist as an individual entity
and look into the specific situation they are in. However, if your pipeline is concentrated
in just a few areas then now is the time to diversify. I’ve written before about
the [how services businesses are an important source of support for charities](https://www.linkedin.com/pulse/need-quickly-cost-effectively-add-prospects-your-pipeline-darnell/),
and where to get information about their giving preferences.

 

 

 

![Person walking up steps](https://wfay6x.infiniteuploads.cloud/2020/04/next-steps-
creative-commons-1024x683.jpg)

_Next steps_

 

## Five actions to take now

 

### 1. Keep tracking your prospects and supporters

 

It is vital that you keep abreast of relevant news. Use tools like Google alerts
and social media notifications to track stories relating to funders and prospects.
Find out how much support is pivoting towards COVID-19 response. We’ve seen a lot
of

 

trusts supporting emergency activity related to the crisis. Decisions trusts are
making about who to fund now will affect their capacity to give further down the
line. As stated above, look both at industry sectors and at individual companies–
how are they being impacted and what does this mean for philanthropists and corporate
prospects?

 

### 2. Re-prioritise pipeline building

 

As soon as you can move out of crisis response mode you must refocus on the pipeline.
It can be hard to find time for prospect research but this is very important.

 

Funding preferences will change in the short term and you need to keep up with this;
some changes will mean that your cause is deprioritised in favour of those focused
directly on the COVID-19 crisis.

 

Despite this issue, the crisis will also present some opportunities. You will only
spot these and be able to act on them if you are looking for new ways to add to 
your pipeline.

 

### 3. Keep focussed on cultivation and stewardship

 

Cultivating and stewarding relationships will remain vitally important. Even if 
a supporter or prospect switches their attention away from your charity and focuses
on something that is directly related to the COVID-19 crisis, you should keep that
relationship alive. If a supporter or prospect is de-prioritising your cause area
then show empathy and understanding. Try to keep the relationship warm. At a future
date they are likely to come back to their original set of funding priorities and
that should mean you are in with a chance of securing income from them once again.

 

### 4. Be honest about changing needs

 

Many charities will have paused or even completely ceased parts of their service
delivery. If you have submitted a restricted ask around a project that is paused
or no longer happening then all is not lost. Having a timely and honest conversation
with the

 

prospective funder will deliver a decent chance of switching the funding to something
else.

 

Similarly if there is a desperate need for unrestricted money then talk to funders,
explain the situation and see whether you can switch any project specific support
to unrestricted or part unrestricted (at Darnell Consulting, we’ve seen several 
clients successfully transition support from being project-specific to unrestricted
in the last 10 days).

 

### 5. Talk to colleagues and peers

 

Good communication with colleagues will ensure you keep abreast of changes of internal
direction so that you can keep funders informed about progress and impact.

 

When you are in the office with people you often come across this information more
easily. Whilst working remotely you will have to work harder at it. 30 minute update
phone calls with colleagues are a good tactic – especially when everyone has video-
call fatigue. Also, talking with peers across the sector is a huge stress reliever
and can also deliver inspiration and ideas. Make use of formal communities like 
the IOF Special interest groups as well as spontaneous exchanges over social media–
and actual real life conversations by phone.

 

 

 

A useful tool to check out:

 

[PWC – free economic outlook live updates](https://cloud.uk.info.pwc.com/economic-update-covid-19-subscribe)

 

 

 

![Grahame Darnell](https://wfay6x.infiniteuploads.cloud/2020/04/grahame-darnell-
300x265.jpg)

 

_**[Grahame Darnell](https://www.linkedin.com/in/grahamedarnell/)** is a fundraising
consultant who has worked with charities of all shapes, sizes and causes areas. 
He has worked in fundraising for over 20 years following the early part of his career
working in marketing in the tech sector. Grahame led successful teams when he worked
in-house and has a history of driving growth as a director of fundraising._

 

_As a consultant, he has developed fundraising strategies with a range of charities
and has a great track record of success. He is highly regarded as a partnerships
and philanthropy expert and speaks and blogs regularly on the subject. Twitter: 
[@grahamedarnell](http://www.twitter.com/grahamedarnell)_

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