Whether you call it a Heritage Society, Legacy Society, or a name more tied to your institution’s mission or history, you most likely have, or need to establish, a recognition society that honors planned gift donors. Membership in these societies is usually reserved for donors who have made a commitment through a life income gift, lead trust, life insurance gift, bequest provision, or other planned gift arrangement.
In many cases donors receive specific benefits when they become a member of a planned gift recognition society, such as personal mementos like lapel pins or plaques, or invitations to special events such as luncheons and seminars. While donors may enjoy certain rewards from a recognition society, the institution is the one that will benefit the most from creating and maintaining a donor recognition society. Here are a few reasons why.
Simple morale booster
Having a recognition society for planned gift donors lets them know you appreciate them and the gifts they have made. Donors who make planned gifts have most likely been annual gift donors in the past and, as such, may have grown accustomed to being a member of a particular gift recognition society for a number of years. Recognizing donors for their planned gifts as well with special, separate giving societies is an easy way to show donors they are special and continue to publicly recognize them for their forethought and generosity—even as they may be reducing the amount and frequency of their current gifts.
Strengthening the ties that bind
Simply by the nature of most planned gifts, a donor has made a long-term commitment to a charitable interest. Maintaining a recognition society allows staff to keep in touch with planned gift donors and, therefore, provides even further opportunities to strengthen long-term relationships with them.
Perhaps you invite recognition society donors to an annual luncheon in their honor. Or your President may host a holiday reception for these special donors. Or they may be included in broader recognition events that have already been scheduled. A recognition society can provide more continuity of contact, i.e. opportunities to meet with donors and get to know them better one-on-one. And once you learn more about your donors, you may be in a better position to help them discover other planned gift ideas that may be of interest to them.
Reduce the risk of removal
If an organization is inattentive to donors of planned gifts due to staff turnover, poor record keeping, or other factors, it runs the risk of alienating them and perhaps losing their gifts altogether. Keep in mind that many planned gifts are revocable. For example, a bequest provision or retirement plan beneficiary designation is completely revocable during the donor’s lifetime, as are the remainder interests of many charitable remainder trusts.
With an effective, ongoing recognition society in place, you can reduce the risk of being removed from a donor’s estate plans. As noted above, planned gift donors may be reaching the age at which their current giving may be decreasing. A planned gift recognition society can be key to managing the natural “downgrading” of donors. The society provides a way to continue to acknowledge a donor’s past and future involvement with your institution. In addition, you may see more planned gift commitments from prospective donors when they see that existing planned gift donors—not just donors of current gifts—are treated well.
Conduct a reality check
No matter how many “benefits” you offer to donors through membership in a planned gift recognition society, realize that few people will face mortality, change their estate plans, and/or incur a legal fee to make a gift that “earns” them a lapel pin or certificate. As a matter of fact, many planned gift donors will never tell you of their gift during their lifetime, and a large percentage of others who do inform you will wish to remain completely anonymous and may not want to participate in a recognition society. Informal surveys have shown that, at the most, 20-30% of estate donors will inform you of their gift provisions in advance.
Though relatively few planned gift donors will notify you of their gifts in advance, and many of those who do tell you don’t want recognition, the donor recognition society remains a vitally important tool in managing gift planning relationships. The donors who will inform you of their gift commitments and who do want membership in your recognition society are a very special group. They have set themselves apart and are demonstrating to you that they want to be more involved with your institution during their lifetime. This increased level of dedication may be the reason why studies have also shown that bequests received from donors in a recognition society are often twice the amount or more of bequests received from non-society members.
So while your recognition society may honor only a small group of donors, remember that this type of relationship-building can help strengthen and cement long-term donor friendships, which can lead to significant additional gift income in the future.
Editor’s note: The preceding article is excerpted from Session VII of “Managing Planned Giving Relationships.” See page 3 for a complete description of the seminar as well as upcoming dates.