I had a candid conversation with a soon-to-retire sports personality (name withheld for ethical reasons, but let’s call her Jane) about her future after years of active professional sports. She was concerned about how to support her charitable activities without spending her savings.
Influential people, including celebrities and athletes, are very active in charitable activities. The strong influence communities have by supporting ‘one of their own’ or supporting their local team helps drive these relationships. Some of the successful athletes are also beneficiaries of non-profit community programs. Therefore, athletes are more likely to be inclined to return the favor by participating in community empowerment activities. But at what price?
From my conversation with Jane, she told me that despite having registered a non-profit organization in her name, her donations to other charities were made using her personal account (nothing wrong with that). However, as someone who wants to be more involved in charity work, the problem is how she requests funds using her personal account. And how do you manage your personal finances outside of charity work?
Like Jane, there are other people who are passionate about charity work but lack strategies for raising funds from their networks and therefore end up spending their savings just to keep up with the spirit of giving back to the community.
Without following a solid plan, it’s easy to stray from your goals. And without a strategy, a lack of financial prudence creeps in and this becomes a drag on your personal and nonprofit accounts.
Once financial management and liability concerns arise, the risk of damage to your brand and persona increases. The impact is devastating to both his nonprofit activities and his personal life, including financially. Negative publicity damages your reputation and credibility. It could also attract punitive action from the government and professional enforcement agencies.
Some of the disciplinary actions by professional regulators and the (federal) government include; dismissal, freezing of personal and organization assets, or imposition of fines as a warning.
Fortunately for Jane, her case was fairly straightforward, so my input was technical. We established the technical structures for your non-profit organization and developed a strategic and operational plan. The strategic operations plan will act as a policy guide for the non-profit organization in the medium term.
I am also pleased to have met Jane and worked with her to develop a prudent plan for how to solicit and manage donor funds in her network. Most importantly, I am pleased to have worked with Jane to separate her personal financial activities from those related to her organization.
There may be other people with concerns similar to what Jane experienced. Others may have unclear strategic fundraising plans. I advise you to seek professional help to clarify these concerns. Not only do they stifle your organization’s growth potential, they also expose you to self-inflicted financial or reputational damage.
