Münzen und rote Herzen in einem Glas stellen Philanthropie symbolisch dar

Philanthropy as Organizational Culture: A Strategic Alignment for NPOs

by Karin Sommer 30.10.2023

Philanthropy as the Focus of Organizational Culture and Strategic Alignment

Placing philanthropy at the heart of organizational culture and strategic alignment is a way to deeply embed it in the NPO and build further strategies upon it. Compared to market orientation or cost/efficiency orientation, a philanthropic alignment is specifically tailored to non-profit organizations and can help improve key fundraising metrics.

Why is a Strategic Orientation Important?

First, let’s address the “why”: Why does an NPO need a strategic orientation at all?

A strategy outlines the path to achieve a specific goal, which directly contributes to fulfilling the mission. Usually, there are multiple paths to the goal, each with different advantages and disadvantages. This is where strategic orientation comes in: it provides guidelines deeply embedded in the organization that directly influence the chosen strategy.

In a business context, for example, there is market orientation – a strategy that focuses on meeting customer needs with suitable products and services. Customers are at the center, and all business strategies align with this focus. Many studies show that market orientation directly leads to better business performance.

According to Prof. Adrian Sergeant and Emmy Bryant, philanthropic orientation similarly impacts the fundraising results of NPOs. It also improves fundraisers’ confidence and employee loyalty.

Philanthropy – What is it?

One of the earliest definitions of philanthropy, derived from the Greek words philos and anthropos, is the “love of humanity” (Johnson’s Dictionary, 1755).

The Center for Philanthropy Studies at the University of Basel adds: “Philanthropy encompasses any private voluntary action for a public good.”

This means that anyone who voluntarily does good for the community is a philanthropist – from Mother Teresa to Bill Gates to Grandma Erna, who regularly donates to homeless people.

Philanthropic actions are always selfless and express strong values. They are a form of ethical behavior aimed at the well-being of others. Kant defines a philanthropist as someone who finds pleasure in the well-being of others and is happy when everyone else is better off.

What is a Philanthropic Organizational Culture?

What does it mean to incorporate philanthropy into organizational culture? According to Prof. Sargeant and Emma Bryant:

“An organization with a high degree of philanthropic orientation will be very receptive to, and welcoming of, a variety of philanthropic sources of income. It is also an organization that recognizes the unique nature of philanthropy and the central role that whole-organization stewardship can play in developing that philanthropy and the well-being of those who might offer it.” (Sargeant/Bryant 2017)

They identify 10 factors important for developing a philanthropic orientation:

Donor Centricity
Philanthropic Organizational Core
Celebrating Philanthropic Successes
Quality of the Donation Purpose
Board Engagement
Professional Commitment
Culture of Innovation
Revenue Growth
Donor Retention
Fundraiser Identity

This shows that a philanthropic orientation must encompass the entire organization, not just the fundraising departments. The backbone of this orientation is:

Donor Centricity

This means placing a high focus on the needs of donors. They are not just seen as cash cows but as individuals with their own set of values and needs. Satisfying these needs is the primary goal of the entire NPO. Psychologists have defined the most important fundamental needs:

The feeling of connection with other people
The feeling of being able to express love to others
Autonomy/Self-determination
Personal growth
Clarity of personal purpose
Self-acceptance

These needs should be at the center of every interaction with donors. Employees can contribute to satisfying one or more of these needs with each contact.

Philanthropy at the Core of the Organization

A philanthropic orientation must be anchored at the core of an organization. All areas must work to awaken and promote philanthropy in people. This point places fundraising at the center – not just as a key financing tool but broadly as a way to engage people with the organization’s purpose.

This also ties into the aspect of “board engagement,” as those at the top of an organization have a role model effect and can inspire employees and donors. Executives and boards should significantly contribute to celebrating philanthropic successes.

Being proud of philanthropic successes together is one of the most important aspects of a philanthropic orientation.

Celebrating Philanthropic Successes

Another crucial aspect is the organization’s pride in its financial achievements. This includes high appreciation for those who made these successes possible and for the entire fundraising team.

“(…) money and mission should be seen as one in the same thing.”

(Sargeant/Bryant 2018)

This broadly means that meeting donor needs—which in turn leads to higher revenues—is equated with meeting beneficiary needs. Donors and beneficiaries are given the same importance.

Professional Engagement

The aspect of “professional engagement” also contributes to this appreciation and alignment of money and mission. It describes an organizational culture that views fundraisers as professionals, promotes networking and professional development, and does not merely see them as money collectors. This, in turn, boosts fundraisers’ confidence and allows the profession to be seen as identity-forming (“fundraiser identity”).

Quality of the Donation Purpose

This concerns how an organization’s purpose is communicated. Often, the focus of this narrative is on the “what.” The beneficiaries have a problem that the organization wants to solve. This becomes the organization’s problem (implementing their “what”), and donors lose the direct connection to the beneficiaries. A philanthropic orientation leads to different storytelling: focusing on the “why.” Why does the NPO do what it does? This creates more emotional and compelling stories.

Centering Philanthropy

With this model for strategic alignment, NPOs can improve their fundraising performance by placing philanthropy—and thereby fundraising as an enabler of philanthropy—at the center. Some might think: “But our mission/beneficiaries are at the heart of everything we do, and that’s good!”

A philanthropic orientation doesn’t contradict this; it goes a step further: An NPO’s mission cannot be achieved without numerous supportive philanthropists. Focusing on these supporters directly benefits the cause and the program’s target groups.

Karin Sommer

Karin is our content specialist. Here, she can optimally use her many years of experience in the non-profit sector for our clients and do what she loves: writing! With great passion, she is committed to simplifying the digital transformation for non-profits and promoting knowledge exchange in the industry: “Through digital fundraising, non-profit organizations can achieve their goals even faster and create a better world for all of us. Is there anything more beautiful than working towards this vision?”

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