Wikimedia has recently been discussing how and why we fundraise, and how we determine where to direct the stream of visitors to our shared global websites when we ask for donations. In particular, two years ago we directed visitors to over 10 chapters who then each processed their donations directly; this was cut back to only 4 of the larger chapters last year, with clearer standards for accountability and financial transparency for those groups.
A few months ago our eloquent executive director, Sue Gardner, began a detailed consultation on the aptly named Meta-wiki to discuss ways to improve this process, which has grown organically over the past five years. She is publicly drafting and annotating her own recommendations to the Board, which will be presented to us in a few weeks’ time. Since this is such a transprent process, we have already had preliminary discussion at our last board meeting, resulting in a letter varying slightly with the draft recommendations at that point. An annual community-wide finance summit, organized this year by the French chapter, was held last weekend in Paris, and these discussions occupied much of the agenda there.
I would characterize this view as “centralize all donation-processing”: he feels the global Foundation can gain economies of scale, and economies of specialization, by processing all donations centrally in the US, and then distributing funds back out to Chapters and other groups around the world — enough to offset the loss of tax-deductibility and other advantages to local processing. (choices of where to distribute, and donor relationship management, would still be made in a communal fashion.)
My own personal view is to “decentralize where excellence and desire meet“: I feel we should support decentralized processing by all highly competent groups with demonstrated skills in these fundraising matters, where they have some local benefit or other reason to process donors directly, and where they decide to take on that challenge. The skills involved are not trivial; some will not develop them, others have no local incentives to do so, still others may not want the extra work entailed. This include competence (and legal ability) to redistribute surplus funds raised to projects around the world, through whatever global allocation/prioritization process we build together. Decentralization of this donor and fundraising work may lose some economies of centralization, but it will gain many others: including direct financial advantages in some regions (tax deduction, matching), and ensuring that we have redundancy of relevant expertise across our movement.
I repost below the comment (copyedited for clarity) that I left on his blog:
I interpret our Board letter in the opposite (positive) sense to Stu’s summary on his blog. I believe that at least some Chapters should payment process, because in some cases we already see that it offers a net benefit for the movement. And I think that any chapter that is sufficiently mature — skilled in dealing with donations, efficient in its work, meets a high standard of financial accountability, and has a history of supporting community-driven dissemination targets — and *wants* to payment-process for banner-driven donations, should be able to do so.
By this description (and reflecting on your four points above), such chapters, before they could process payments from sitewide-banner campaigns, would first have to be:
- Already processing payments locally, managing their national messaging in sitewide campaigns, complying with local financial regulations, and handling donor relations. (They would already be processing payments from local email and media campaigns)
- Efficient in their financial work; so that this would not be significant additional time and money on top of their normal operations
- Demonstrably skilled in their financial work, and able to meet strict standards maintained by the Foundation and the movement as a whole.
- Lacking in a sense of entitlement, and participating in community-led allocation work to identify and support impactful work worldwide
This would be a limited set of large, respected Chapters. It would not be a natural step in chapter growth, and only those with a financial and donor-focused bent would be in a position to pursue it (or to implement it efficiently). Other options exist now and will only grow for smaller chapters. Some chapters will be founded in countries with strict financial laws that make it too difficult to distribute funds outside the country.
Enabling groups to grow in areas where they have demonstrated excellence and foresight is consistent with our culture of empowerment; and having more than one body competent to do any significant task is consistent with our culture of decentralization.
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