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Transparency Is Its Own Reward

“Transparency” is just a trendy new term for “openness.” Openness can work in a nonprofit’s favor.

But a charity that tries to keep too many secrets may end up with the feds imposing a little “transparency” of their own, which in the legal system is sometimes called “discovery.” Case in point: The Kabbalah Center. 

Just to recap, the IRS and a grand jury in the U.S. District Court of the Southern District of New York is asking serious questions about the nonprofit Kabbalah Center. The general drift of the questions is: What happened to all the money?

A court in Los Angeles wants to know, too, now that a West Coast donor is also suing for the $200 million she says she was taken for.

Having a celebrity like Madonna on board with your nonprofit’s mission – as the Kabbalah Center does – can confer a powerful advantage. It means built-in publicity, name recognition, and probably a fat donation from the personality in question.

Problem is, when things go south at the charity, more eyes are watching, and the court of public opinion doesn’t wait for explanations.

What seems clear to us is, whatever the facts in the case, the more open we fundraisers can be about our charities, the better. And not just for anti-scandal purposes.

Donors are attracted and motivated by the kind of transparency that lets them know who and what the charity is, what its goals are, what it believes in, how donations will be put to use, the procedures and personalities involved, and who really benefits at the end of the day.

If you have trouble answering these questions for yourself, consider punching up your organizational transparency. Because scandals like the one brewing at The Kabbalah Center can only make you look bad if your nonprofit looks as opaque as The Kabbalah Center.

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