AHP Connect Articles

CEO Corner: The Critical Impact of Philanthropy

I recently had the opportunity to speak at the Governance Institute to hospital and health system board members and C-Suite executives. I was asked to talk about campaigns, but I started with the slide below, which many of you have seen me present, on the importance of philanthropy to the work of the organization:

What I thought would be a quick discussion turned into a 30-minute conversation. The people in the audience were intrigued and had not thought about philanthropy and our work in this way. I thought I would share the talking points I use when presenting this slide in case they are helpful to your work.

There are three key points to underscore:

1. It may seem like the revenue coming from the philanthropy team is small compared with other areas of the organization. But, based on an informal poll of our membership, it takes $17 to $100 new patient dollars to equal the net revenue of a single dollar from philanthropy. To drive this point home, that means for every million dollar gift, you would have to have between $17 and $100 million in new patient revenue for the same net revenue impact.
2. The philanthropy team is likely delivering the highest ROI of any “department” in your organization. For every $1 invested in the work of the philanthropy team, we return an average of $4, with the highest performers delivering as much as $5.50 per dollar invested.
3. Moody’s, the bond credit rating company, and others like them are now taking into account the track record of philanthropy teams when issuing ratings. Organizations that can show consistent performance in philanthropy get a better rating and can borrow money at a lower interest rate.

If you have questions or if I can help in any way, please let me know. Email me at alice@ahp.org. If you'd like to see the whole presentation this slide comes from, you can download it here.