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What’s In a Name? May 13, 2013

Filed under: accountability,communications,individual donors,transparency — fundtimes @ 4:58 pm

Most people are familar with the quote, “…a rose by any other name would smell as sweet.” But how many understand what this means or even where it came from? Channeling my inner nerd, I looked it up and found that it is from William Shakespeare’s play, Romeo and Juliet. Juliet says to Romeo,

“O, be some other name!

       What’s in a name? that which we call a rose

       By any other name would smell as sweet;

       So Romeo would, were he not Romeo call’d,

       Retain that dear perfection which he owes

       Without that title.”

In full context, Juliet proclaims to Romeo that his family name does not diminish who he is (aww). But can the same be said for nonprofits’ reputations who accept major gifts in return for donor naming rights?

Generally assigned to the private sector, naming rights is a financial transaction where a corporation purchases the right to name a facililty or other physical space (often as a long-term advertising strategy). Like a lot of for-profit tactics, naming rights have been adopted by nonprofits as a perk for major donors.

In an earlier post, I explored the need to properly vet potential donors. These same warnings can also be applied when considering whether or not to place a company’s or individual’s name on anything tied to your nonprofit. In this cash-strapped economy, the last thing a nonprofit needs is bad publicity. Below are a few tips to guide your nonprofit in considering whether or not to provide naming rights for major donors:

  • Is it Worth It? – As with any major decision, your nonprofit’s leadership should determine if it is even worth it to have naming rights as an option for major donors. The average nonprofit does not own a lot of property, if any. Rather, the decision to allow naming rights is prevalent among larger nonprofits like institutions of higher learning. Therefore, a quick inventory of your nonprofit’s size will determine the usefulness of implementing this fundraising strategy.
  • Investigate – In this age of information, it should be relatively easy to investigate a major donor’s reputation (Google, anyone?). If the internet proves unfruitful, you could also consider asking other nonprofits who have received donations about the quality of their interaction with a given donor.
  • Put It In Writing – If you decide to allow naming rights for major donors, then it is useful to create a policy that outlines the terms and expectations of this agreement. If your nonprofit receives money from foundations, this policy would be similar to the grant agreement that you sign upon notification of an award. Click here for an actual example of a naming rights policy.

What are your thoughts on donor naming rights? Would you consider implementing such a policy for your nonprofit? Why or why not?

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