As long as your chamber is seen as a pillar of your community, organizations will see you as a natural partner for them seeking sponsorship and donations. Your board members might even try to talk you into supporting their causes or sponsoring their kid’s little league team. That can be uncomfortable, especially if the person or organization approaching you does a lot for your chamber.
Without a clear and well-defined donations policy, this can quickly become a minefield of difficult decisions, accusations of favoritism or preferential treatment, and even political drama.
How can your chamber balance its desire to support the community (buy the occasional box of Girl Scout cookies, for instance) with its need to maintain neutrality and focus on its core mission?
The Importance of a Formal Donations Policy
A formal donations policy isn’t about being heartless; it’s about being strategic and transparent. It provides:
- Clarity and Consistency: A clear framework for evaluating requests, ensuring fairness, and avoiding perceived favoritism.
- Mission Alignment: A tool to ensure donations support the chamber’s strategic goals and core mission.
- Financial Prudence: A way to manage resources responsibly and avoid overcommitment. No chamber, no matter how well-funded can afford to donate to everyone.
- Reduced Risk: A shield against potential accusations of bias or misuse of funds.
- Simplified Decision-Making: A streamlined process that reduces the burden on staff and volunteers.
Key Elements of a Robust Donations Policy
What should a donations policy entail? While we’re not attorneys, the following components are a good start.
Include Your Chamber Mission and Strategic Priorities
- Clearly articulate the chamber’s mission and how charitable giving aligns with it (or doesn’t). If you don’t want to be burdened with the donation process, you can do what they did at the Barrow County Chamber of Commerce as Thomas Jennings explained, “We get soooo many requests for donations from non-profits, we now have in our by-laws a section that declares that we, the chamber, are to refrain from any monetary contribution/donations. We as staff are welcome to volunteer and assist our non-profits, but it’s on our time (unless it’s for a chamber-related function).”
- Identify specific areas of focus (e.g., economic development, education, workforce development) that will guide your giving.
- Will you consider requests from everyone or only 501(c)3 organizations?
Establish Clear Eligibility Criteria and a Budget
Make sure whatever eligibility you set, you’re also within your budget and that means ensuring donations are in your budget in the first place. As Timothy Jordan shared on the Chamber Pros Facebook group, “We line item budget a certain amount annually for contribution. We ensure the donations meet our mission in some way, and when it’s depleted, it’s done for the year. I believe community relations is a key component to the work the chamber does to bridge the gap between business and community. For us, it’s a win-win. I do realize chambers are all different in ways as there’s no one-size-fits-all; this works wonders in our community, builds morale, and strengthens the voice of the chamber. We also are 20% dues and 80% nondues revenue with zero city or outside agency funding.”
Establish criteria by:
- Outlining the types of organizations and projects you will support.
- Specifying geographic limitations (e.g., local versus regional).
- Defining the types of donations you will offer (e.g., cash, in-kind services, event sponsorship).
- Setting financial limits for donations.
Develop a Formal Application Process
- Create a standardized application form that requests essential information (mission, impact, financial needs, etc.).
- Establish deadlines for applications. Companies do this, as you know from some of your sponsors.
- Designate a committee or individual responsible for reviewing applications, if needed.
Implement a Transparent Evaluation Process
- Develop a scoring rubric based on your eligibility criteria. That way, you can explain the selection process. It’s not arbitrary.
- Document all evaluation decisions. You don’t know when you will have to go back and answer a question. Don’t rely on your recollection.
- Ensure that all applicants receive timely notification of the decision.
Address Potential Conflicts of Interest
- Establish guidelines for disclosing and managing conflicts of interest among board members and staff.
- Recuse individuals with conflicts from decision-making. A board member should never decide on funding in a project or group that they have an interest in.
Develop a System for Tracking and Reporting
- Maintain records of all donations made.
- Track the impact of donations where possible. This can be a great addition to a strategic plan if the funding aligns with one of the chamber’s strategic priorities.
- Maintain detailed records of all communication and decisions. This protects the chamber from accusations of bias or impropriety.
Navigating Sticky Situations and Saying “No” Gracefully
Even with a solid policy, you’ll inevitably encounter situations that require tact and diplomacy. Here’s how to handle them:
Mission Mismatch
When the organization or requested sponsorship isn’t a great fit for the chamber, explain how the request falls outside the chamber’s mission and priorities. Then offer alternative resources or referrals to other organizations that may be a better fit.
It may feel awkward saying no, but focus on the chamber’s commitment to its own strategic goals.
Limited Resources
You can’t help everyone. Your primary goal is assisting the business community. You can’t give money, time, and resources to everyone. Acknowledge the value of the organization’s work. Explain the chamber’s limited resources and the need to prioritize requests. Offer to consider the organization for future opportunities or ways to showcase their work.
Political Pressure
Politics and political pressure can be unbearable, especially if you receive funding from a group that is now asking for your assistance. When that happens, remain neutral and refer to the established donations policy. Emphasize the chamber’s commitment to fairness and transparency. Avoid making exceptions that could create precedents like, “You did it last year.”
Communicate Clearly and Respectfully
Deliver negative decisions in a timely and professional manner. Don’t draw them out because you don’t want to have a difficult conversation. If you do, they may assume you’re “thinking about it.” When you ultimately turn them down, they’ll want to know why they didn’t make the cut (even though there was never any cut to make).
Provide clear and concise explanations. Conciseness is key here. Don’t write a dissertation into why you’re saying no.
Avoid vague or ambiguous language. Don’t give them the impression you might change your mind if they just beg a little longer.
Always thank them for the request.
Turning a Negative into a Positive
Even when saying no, look for ways to offer alternative support, such as:
- Promoting the organization through the chamber’s communication channels.
- Connecting the organization with potential volunteers or donors.
- Offering in-kind support, such as meeting space or marketing assistance.
By maintaining a professional and transparent process, you can build trust and strengthen relationships within your community, even when delivering difficult news.
With a well-crafted donations policy, your chamber can confidently navigate the complex landscape of charitable giving, ensuring that your resources are used effectively to support your mission and strengthen your community.
Curious what other chamber pros say about the chamber and donations, check out the conversation here.
