The Economic Recession Impact on the Fundraising Process - Research Paper Example

The economic recession impact on the fundraising process from the perspective of Latsis Public Benefit Foundation, a major donor in Greece.

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Abbreviations

LPBF Latsis Public Benefit Foundation

Acknowledgements

I would like to thank my dissertation supervisor Dr. Ana Gaio for her help and guidance to my chosen topic. I am also grateful to the Latsis Public Benefit Foundation and its team, for their interest to participate to my dissertation and for providing me with all the vital information for the completion of this dissertation.

Above all my gratitude goes to my family for supporting and encouraging me during this MA year.

Declaration

I grant powers of discretion to the University Librarian to allow this thesis to be copied in whole or in part without further reference to me. This permission covers only single copies made for study purposes, subject to normal conditions of acknowledgement.

Abstract

The economic recession impact on the fundraising process from the perspective of Latsis Public Benefit Foundation, a major donor in Greece.

The economic recession nowadays has an impact on various aspects of our lives. Since a recession is typically characterized by high unemployment, increased inequality and falling average income, the impact of the recession depends on how long it lasts and the depth of the fall in input. The latest recession in Greece 2009-date has shown many of the negative impacts of recession.

This dissertation investigates the economic recession impact on the fundraising process from the perspective of Latsis Public Benefit Foundation in Greece, which funds numerous programmes and causes of NPOs in need. Thus the case study of the LPBF foundation is presented in the dissertation in order to explore the applicable theory in practice.

Since its establishment the foundation has helped various sectors in the Greek community. Although the foundation has been facing one of the worst Greek economic recession, it managed to successfully carry out its duties to help the underprivileged in line with its objectives and purpose despite the downturn. It has brought about positive change in the Greek society, by improving their living standards and advancing the human civilization.

The research method employed is qualitative content analysis of the interview to the participant of the research, who is in charge for the funding schemes of the foundation.

The research concludes that the economic recession has influenced the funding strategies of the foundation as well as it has become evident that the amount of donations fluctuates within a recession. The increasing petitions of NPOs for funding during a recession, also offers an interesting area of future research.

Chapter 1.

Introduction

Foundations are defined as non-profit organizations that donate finances and support to various organizations or offer the funding source for its charitable intentions. Organizations include public associations and private foundations. There are some important structural components that are identified under legal categorization or scrutiny of a foundation. They include; the purpose and objective(s) of the foundation, management and supervision provisions, provisions for the entitys dissolution, legal requirements that led to its establishment, auditing and accountability provisions, the economic activity, the foundations tax status, provisions for the articles or statuses amendment of incorporation, and corporates and private donors tax status.

Economic recession is defined as a meaningful reduction in economic activity spreading across the economy that lasts for more than six months which is referred to as two-quarters. An economic recession is indicated in the real gross domestic product, industrial production, real income, retail and wholesale sales and profits, employment, investment spending, inflation fall, and capacity utilization (Rosenberg, 2012). Economic recession reduces all these indicators. Economic recessions are caused by various such as, external trade shock, a burst of an economic bubble, financial crisis or a negative supply shock (Clarke & Huliaras, 2016). Governments react to an economic recession by employing extensive macroeconomic policies, such as enhancing the supply of money, taxation reduction, and increasing the spending of government. During an economic recession, organizations have to adopt different organizational models and strategies to adapt the changed economic environment. Foundations are no exemption, therefore, they are also affected by economic recessions (Lynn, 2010).

Latsis Public Benefit Foundation (LPBF)

This paper will lay emphasis on the influence that the economic recession had towards the course fundraising in LPBFs context, which serves as Greece major donor. Latsis Public Benefit Foundation was named after John Latsis, an entrepreneur who carried out multiple initiatives to benefit the public. He undertook philanthropic efforts due to his distinctive patriotism, dedicated faith in the family institution, empathy for his fellow human beings, and a strict sense of accountability towards younger generations (Fotna, Katsikas, & Kamouzis, 2013). Two years after his death, his family established the Latsis Public Benefit Foundation in 2005. The purpose of this foundation was to stream his personal philanthropic initiative into a well-structured organization which would benefit the public. The foundation focuses on supporting and undertaking initiatives on social welfare, education, environment, culture, and science. It is located in Greece. However, it serves globally (Kramer-Hajos, 2016).

Foundations require resources to accomplish their goals and achieve their missions. They also need to develop and grow their activities reaching a larger geographical and political area. Key resources are classified into financial resources and human resources. Financial resources include revenues from services and products and willing donors while human resources include volunteers and employees. The ability to raise the necessary funds is vital to the performance and success of non-profit organizations (Aliprantis & Papageorgiou, 2010).

Regarding the statistics indicated in the paper concerning the Greek recession, there is a high living cost, high unemployment rate, and increased homeless people. Economic and social challenges faced the country, and Latsis Public Benefit Foundation had to intervene. Within the initial ten years of the organization establishment, the foundation had to confront the Greek recession. They faced the Greek recession within the first ten years after its establishment. The first five years were to set up the groundwork for their operation, hiring staffs, improving and amalgamating with extant public benefit exercises, and creating scientific, cultural and educational programs that involved important objectives of the Foundation (Renzaho, 2016). During this period, they undertook a four-year initiative countrywide to rejuvenate areas that had been struck by fire and assist citizens that had been affected by the 2007 fire. The initiative also created key measures to improve prevention of natural disasters and reaction mechanisms. From 2011 to 2015 the foundation focused on restructuring their priorities to react to the adverse outcome of the Greek economic and social crisis. The foundation reconfigured their programs to handle the new social challenges and effectively accomplish the organizations objectives and purpose of a public benefit foundation (Arabatzis, Renn, & Simoes, 2015).

Since its creation, the foundation has sought creative cooperation with the private and public sectors and functioning civil society organizations. Due to the complexity of fundamental social concerns, the foundation wants to create, in partnership with scientific associations, grantees, and partner organizations, a common model to fulfill their common objectives. Their key goal is to create a welfare society where private initiatives, citizens, and state integrate to develop a powerful social invulnerable net (Berman, 2015). The foundation aims to offer opportunities to creative and large recognized players inventing important organizations in the cultural, scientific, educational, and social cohesion spheres. Additionally, the Foundation strives to develop an ecosystem of social accountability established on innovative concepts, mutual education and knowledge, productive thinking, and adjustable strategy (Marconi, 2015). Furthermore, it has collaborated with people and organizations who are highly recommendable, with optimistic views of the world and perform tirelessly tackling very challenging situations with an affection for social development and unlimited creativity hence creating their aimed ecosystem will be easier. The foundation has managed numerous grants for the last eleven years, supporting programs and causes of various Greek NPOs. (Bodel & Dimitrova, 2014).

Research Question

The study aims to engage the foundations employees effectively in improving the results and conclusion of the research. It will help in determining the fundamental causes of the foundation, and the key reasons as to why the institution stops its support programs or whether it anticipates gaining certain things after providing the gifts, or if the economic recession had any important impact on the donation amount, while compared to past years. Furthermore, it will determine in case the process of fundraising is dependent on the relationsh...