It’s hard to come up with an example of a greater waste of nonprofit funds and time than the annual report.

Well, most annual reports at least.

I’ve seen dozens of CEOs, communications and development directors waste countless hours fuming, fussing and meeting over these egocentric tomes in hopes of impressing donors. And, I’ve learned from thousands of donors that when it comes to most annual reports they’re absolutely unimpressed. One more piece of ‘stuff’ to toss away.

Of course it doesn’t have to be that way. But what way should it be? The title of a piece on annual reports by our friend and veteran fundraiser Giles Pegram holds the answer. In Your annual report is more about your donor and your cause than about your organisation, Giles argues that most annual reports fail to garner donor support because they’re too organizational-centric — far too much about  the greatness of the organization; far too little about the donors or beneficiaries.

Giles warns: “…though many of us profess to being relationship fundraisers, we collude with a belief that the annual report should be about the charity, and its achievements. And we thank the donors that have supported the charity. The charity is at the centre, not the donor.”

His formula for what he calls a ‘donor-led’ or donor-focused annual report is simple. It requires:

• Bringing the cause and the donor together, not just connecting donors with the beneficiaries;

• Making the charity ‘invisible’, not just about subordinating it, but simply using it as the conduit to illustrate what individual donors have achieved for individual beneficiaries.

Giles illustrates his point by by urging us to take a look at what he says is “one annual review that is seriously different. And has seriously impressed me.”

You’ll find it by clicking here. This exemplary report is the work of a young, donor-focused fundraiser named Robin Peake on behalf of the UK nonprofit Innovista. Please take a few minutes to read the report.

Here’s Giles review of the report and why he thinks it’s exemplary:

• Starting with the cover “Stories of hope. Written by you” the report is devoid of the usual organizational ego-tripping statistics.  Nothing on the importance of the charity. It’s all about the donor.

• Every story on a beneficiary is accompanied by a story of a donor. (“This story is made possible by Jim and Sandra from Northern Ireland, who give monthly to support young leaders in Central Asia.”) 

• The report focuses 45% on beneficiaries, 45% on donors and 10% on the charity.

In a nutshell:  This is an annual report about what individual donors have achieved for individual beneficiaries.

Best of all, as Giles notes, doing an annual report in a donor-focused manner “is not rocket science.” We all can do it! And should!

Sure, I know there are tradeoffs and arguments inside all organizations when it comes to communications. It’s what Mark Philips of the Bluefrog agency calls the Fundraising Paradox.

Mark illustrates the paradox in the graphic below and notes that if you stick to the ‘purple zone’ on the chart in focusing your communications “you won’t go far wrong”.

What is the focus of your organization’s annual report? More about the donor? Or more about you?

Roger