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Financial disclosure: Part 4

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By Todd Cohen

Fueled by donor demand, the widespread availability of Form 990s and other financial information has given nonprofits a powerful fundraising tool, says Paula Maehara, president and CEO of the Association of Fundraising Professionals.

The more information donors and constituents have, “the more connected they are and the more willing they are to give money,” she says. “It creates an environment that is very ripe and very positive for an individual to be asked for a gift.”

Nonprofits now can deliver information such as 990s, annual reports and financial statements on their websites and with email, providing information critical to a new generation of donors and volunteers, Maehara says.

“Donors of today are a little different than donors of two generations ago,” she says. “They want to be involved with the organization either by giving money or giving time, or both. And the more connected you make them feel, the more likely you are to have them as a donor or volunteer.”

Bob Ottenhoff, president and CEO of GuideStar, says greater disclosure of nonprofits’ financial data reflects big changes in the practice of philanthropy.

“Now, philanthropy is not something just for a wealthy individual and something that’s created as part of your estate planning,” he says. “Today, people have opportunities to be involved with a community foundation, in a donor-advised fund, to make donations online with a credit card, to start a small family foundation. There are many ways for you to be engaged.”

And while many donors still give “without question” to their college, local PTA or religious congregation, he says, “the era of assumed virtue is over, and to many of these people, it’s not even just about virtue, it’s about effectiveness.”


Other stories in the series:

Part 1: Nonprofits adapt to donor demand, technology change
Part 2: Disclosure data online all the time 

Part 3: Nonprofits increasingly are sharing data. 
Part 5: Nonprofit face tougher rules on sharing data.

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