TRACK TWO SUMMARY: SUSTAINABLE & DIVERSE FINANCING

November 29, 2011

• Need multi-year funding (three plus years)

• No core funding

• Not much funding for innovation

• Approval process too slow – money comes in late

• Risk mitigation – standards vary & paying at the end – shift risk taking to non-profit sector

• Competitive – pits organizations against each other

• Excessive reporting requirement

Issues: Grants & Contributions

• Clauses that prevent advocacy

• Risk that you would drift from your mandate in order to “fit” the program

• Better understanding of in-kind contribution, expectations and purpose

• A lack of internal communication between ministries & different levels of government is a hindrance to determining the most effective distribution of funds

• Rules constantly changing

• Need more information on available grants

Issues: Grants & Contributions

Outcomes & Actions: Grants & Contributions

DESIRED OUTCOMES

• Multi-year funding based on policy outcomes, including all costs with standard applications and reviews (34%)

• Standardized reporting system on how money is spent (20%)

• On-going dialogue with governments on common issues and new models of cooperation (16%)

ACTIONS• Presentation to the Treasury Board by

Imagine Canada and ability to articulate a process to work towards

• Multi-Year Funding Agreements:

1. Test with a government that is interested (e.g. Calgary mayor) in this model

2. Use the results as an evidence based example of how this with other governments and other partners

3. Imagine to start dialogue with feds on this idea

• Other actions?

• Barriers to earned income– Risks– Adverse regulatory environment– Donor objections– Government structure not conducive to entrepreneurship– Lack of Venture Capital

• Need access to resources to develop sensible and sustainable strategy. Including regulatory environment, monitoring risk, & governance

• Earned income focus can distract from mission (i.e. “mission drift”)• The more earned income you get, the more infrastructure you need – often

different infrastructure from doing your mission work• The sector lacks an entrepreneurial spirit and access to venture capital

Issues: Earned Income

Outcomes & Actions: Earned Income

DESIRED OUTCOMES

• Better CRA regulations that support social enterprise/social finance (31%)

• More contact between sectors on social finance, eg, non-profits, business, financial institutions, government (22%)

• Better board knowledge of sector financing including new social finance possibilities and risks (15%)

ACTIONS• Advocate with CRA and the government

about the importance and benefit of social finance & social enterprise

• Work with Federal bureaucracy to ensure policies will actually allow/encourage social finance & social enterprise activities

• Sharing / scaling successful innovative funding initiatives

• Develop a primer and/or low-cost consultation or website for organizations that are contemplating social enterprise

• Work with government and foundation partners to create capacity building grants to improve earned income activities

• Design training materials for Boards• CRA needs to spend more energy on

educating the sector about the rule and this increased vigilance.

• Need consistent definitions of “fundraising” vs. administrative costs

• Can Facebook, the new community, provide the modern day collection plate

• No recognition of the need for operating funding

• Economic downturn and stock exchange vagaries have negative impact on giving

• Impact of media stories: resulting in decreased trust in charities

• Competition from public sector institutions

• Long & onerous process to nurture relationships that lead to a donation

• Donors are giving only to the specific outcome that they want: they are not giving to good of mankind but to the good of "my kind”

Issues: Philanthropy

• Need training on pathways to philanthropy• Need better tax incentives• Lot of untapped potential money• How to get rich Canadians?• How to harness New Canadians contributions to mainstream charities?• There needs to be more public education on importance of and need for

qualified professional staff• There are a large no.’s of charities operating in rural settings: hard to attract

donors and get voices heard

Issues: Philanthropy

Outcomes & Actions: Philanthropy

DESIRED OUTCOMES

• Better perception by the public of charities and non-profits and of their positive impacts on society(32%)

• Stretch tax credit and capital gains exemption for gifts of real estate in budget (22%)

• Foundations fund operating expenses (18%)

ACTIONS• Lobby Finance Committee, MPs,

members of Cabinet• Collective of charities should get together

to build a campaign (awareness campaign with advertising, earned media, social media) to promote giving (i.e. Participaction, Acts of Kindness)

• Create alternative ranking systems to Charity Intelligence

• Develop shared metrics for charities, sensitive to size, maturity & place

• Create an Imagine communication committee

• Identify the Canadian Bill Gates who will champion other similarly wealthy folks who will do real 'philanthropy'

Issues: Financial Literacy• Limited understanding among old and new board members of agency

finances• Size of organization has much impact on internal capacity for:

– Earned income– Understanding CRA– Understanding financials– Reporting & accountability

• Others that need increased financial literacy– Donors (i.e, how much it actually costs to do our business)– Program managers in government who work with non-profits

Outcomes & Actions: Financial Literacy

DESIRED OUTCOMES

• More resources for increased financial literacy for non-profits, boards, auditors and civil servants who deal with non-profits (38%)

• More learning about non-profit sector in business, schools, CA courses, auditor training, civil service, law school & banking(28%)

• Imagine Canada produce financial literacy resources especially for non-profit Boards (24%)

ACTIONS• Create a national inventory of

organizations available to provide financial literacy resources and assistance

• Produce a or series of YouTube tutorial(s) and/or webinar(s)

• Engage financial institutions to provide internships and work experience in the sector to identify learning into financial management in the sector.

• Sector-led consultation with CRA about barriers to providing clear guidelines and written responses.

• Explore offering continuing education credits or some other recognition program for service or learning opportunities.

• Look at Australian example of a "translation" manual that defines and clarifies terminology