Do donors care about results?
Arts donors not impressed by effective and efficient arts nonprofits.
Nonprofits are facing increasing pressure to measure and demonstrate their performance outcomes. However, we know little about the relationship between a nonprofit’s performance and its ability to attract donations. Do donors value an organization’s performance information when making giving decisions? We find that organizations that are more successful (i.e., attract larger audiences to their programs and more visitors to their websites) tend to receive fewer contributions. Despite a growing culture of performance measurement, the empirical evidence does not provide strong support of its relevance among donors. A plausible theoretical reasoning is that better performance outcomes create the image of success, making organizations look less needy. These results call for more research on the link between performance outcomes and philanthropy.
Charles, C. & Kim, M. (2016). Do donors care about results? An analysis of nonprofit arts and cultural organizations. Public Performance and Management Review, 39(4): 864-884.
Segedin, Andy. "Arts Donors Not Impressed by Organizational Efficiency." The Nonprofit Times, September 13, 2016 http://www.thenonprofittimes.com/news-articles/arts-donors-not-impressed-organizational-efficiency/
McCambridge, Ruth. “Study of Arts Nonprofits Shows Donations Drop as Audience Numbers Rise.” Nonprofit Quarterly, September 8, 2016 https://nonprofitquarterly.org/2016/09/08/study-of-arts-nonprofits-shows-donations-drop-as-audience-numbers-rise/
Burns, Mike. “Nonprofit Boards and Accountability #NonprofitBoards.” Nonprofit Board Crisis, September 8, 2016 http://nonprofitboardcrisis.typepad.com/mbblog/2016/09/nonprofit-boards-and-accountability-nonprofitboards.html
“For Arts Nonprofits, Attendance at Events Unlikely to Influence Donors.” Philanthropy New York, September 9, 2016 https://philanthropynewyork.org/news/arts-nonprofits-attendance-events-unlikely-influence-donors