Saturday, February 7, 2009 gives Defenders of Wildlife a D Rating

No Defense for Bad Accounting

Celebrating its 60th anniversary this year, Defenders of Wildlife (DW) once again receives a "D" rating from AIP based on recently received 2005 financial information. At first glance, the tax form gives the appearance of a fairly efficient group, reporting $19 million out of its $25.6 million in total expenses going to programs. However, upon closer inspection, it turns out that about half of reported program spending consists of direct mail and other combined educational campaign and fundraising solicitation costs, reported as joint costs in the group's tax form.

An AIP member sent us a solicitation she received from the group which included five colorful greeting cards with envelopes, a small page of address labels, an informational letter containing multiple requests for a contribution, a "members'-only" offer for their choice of a kitchen apron or wind chime containing the organization's insignia, and a "Contribution Reply Form." On the back of each greeting card appears a paragraph of facts about the animal whose photo appears on the front of the card, along with an address to the organization's web site where donors may obtain more information on what they can do to help save the animal. Once the costs associated with such mailings and other joint costs are subtracted out of program expenses, DW spent only about $10.9 million, or 43% of its total expenses on its programs.

Another recommendation made by DW's auditors refers to the group distorting its fundraising efficiency by accounting for its direct mail expenses in a different financial period than the resulting contributions. It states, "Defenders policy is to expense direct mail costs as incurred and not in the period to which the mailing relates. This practice can materially misstate direct mail costs in any one fiscal year. We recommend Defenders record direct mail costs in the period in which the mailing is sent." The auditors had other recommendations, including a concern with DW recording certain direct mail costs as program expense even though they should have been reported as fundraising.

In response to AIP's inquiry, DW claims that it did adopt some of the recommendations outlined by their auditors in the 2004 report, and has taken steps to better comply with certain accounting and reporting standards. However, donors should not be fooled. The group is not spending donors' dollars any more efficiently than it has in previous years.

Additionally their direct mailing campaign fill the landfills with tons of paper and plastic.

Often, just one or two people in 100 respond.

The proliferation of environmental appeals is beginning to boomerang with the public, as well. "The market is over-saturated. There is mail fatigue," said Ellen McPeake, director of finance and development at Greenpeace, known worldwide for its defense of marine mammals. "Some people are so angry they send back the business reply envelope with the direct mail piece in it."

Even a single fund-raising drive generates massive waste. In 1999, The Wilderness Society mailed 6.2 million membership solicitations -- an average of 16,986 pieces of mail a day. At just under 0.9 ounce each, the weight for the year came to about 348,000 pounds.

Most of the fund-raising letters and envelopes are made from recycled paper. But once delivered, millions are simply thrown away, environmental groups acknowledge. Even when the solicitations make it to a recycling bin, there's a glitch: Personal address labels, bumper stickers and window decals that often accompany them cannot be recycled into paper -- and are carted off to landfills instead.

"For an environmental organization, it's so wrong," said McPeake, who is developing alternatives to junk mail at Greenpeace. "It's not exactly environmentally correct."

The stuff is hard to ignore.


© Janet Crain

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