By Emmanuelle Gril
Your generosity makes it possible for charitable organizations to support the causes they champion, but how do you choose who gets your donations?
In Canada, the number of individual donors has fallen sharply over the past 10 years, from 65 per cent to 53 per cent. Not surprisingly, the average amount of annual donations has also dropped, slipping from $448 to $383, according to the most recent survey by the consulting firm Épisode, in collaboration with Léger. If we exclude those who haven’t donated, however, this figure climbs to $592. The generosity index, meanwhile, remained stable in 2023: for every $100 of gross income, Canadians contributed on average 60 cents in the form of a donation, which is good news, because need is greater than ever.
It’s not always easy, though, to choose among the many charitable organizations working in a wide range of sectors—from health and social services to education, animal welfare, and arts and culture. The following guidelines can help you identify those that best fit with your values and can be expected to use your money wisely.
1. Find the causes that are close to your heart.
The first thing to do is figure out which cause or causes you want to support, the values that are important to you, and the objectives you want to reach by making a donation and then identify the organizations that fit your criteria in the sector of your choice. “Websites are a good source of information,” says Émilie Lamoureux, president-elect of the Quebec chapter of the Association of Fundraising Professionals and assistant director of the Alumni and Development Office of the École de technologie supérieure in Montreal. “Many charities publish their annual reports online, but you can also contact them directly to ask them questions.”
2. Check the mission.
The name of the organization can sometimes cause con- fusion. “For example, the Canadian Cancer Society is dedicated to research, while the Fondation québécoise du cancer (“Quebec Cancer Foundation”) offers people with the disease support and help with daily living,” says Fabien Major, a financial professional and personal-finance columnist. Both are noble causes, but they’re very different, which is why it’s important to check the organization’s mission.
3. Read testimonials.
You also need to check that the values an organization expresses are reflected in its actions. How can you know that? Take a look at the charity’s annual report, which contains a lot of details about the mission and the vision it promotes as well as testimonials from donors or recipi- ents. It’s also a good way to check that the organization has a good reputation.
4. Make sure a charity is legitimate.
Is the charity registered with the Canada Revenue Agency (CRA)? To make sure, you can search for it by name in the CRA’s list of charities and other qualified donees, which it updates daily: it contains 85,400 registered charities. Only those named in this directory are authorized to issue tax receipts, which allows you to get a tax credit for donating. You can find the list at canada.ca.
5. Check for transparency.
Lamoureux stresses that you should pay special attention to transparency. “That the annual report and financial statements are available on an organization’s website is a good sign,” she notes. Ideally, you should also be able to find out who’s on the board of directors. (See #6.)
6. Review its approach to governance.
Governance, or the way an organization is led and managed, must also be on your radar. Make sure that it has put in place accountability and transparency policies, and become familiar with the structure and composition of the board of directors—to properly carry out its mission, the board should be diverse and independent.
7. Study an organization’s impact.
Financial statements contain information on how donations are used, which tells you whether your money has tangible effects. If most of the donations go to administrative expenses, you may want to think twice. To earn an A+ rating from Charity Intelligence Canada, a charity must ensure that at least 90 per cent of the money it raises goes to its programs.
8. Watch for possible scammers.
Unfortunately, scammers are at work in the fundraising field. “If you get an unsolicited and urgent request for a donation, that should be a clue that something is not right,” Lamoureux says. “And be on your guard if the project or the use of funds is vague and lacks detail. Some scammers will also use names that are similar to those of legitimate organizations, which is why you need to stay vigilant.”
