Major donor study by Austria’s FVA reveals both sobering & encouraging facts

Major gifts can be an important income stream for nonprofits but in Austria little information has been available on how widespread they are or even a definition of what constitutes a major donation. The country’s fundraising association Fundraising Verband Austria recently conducted a study to learn more. Stephan Kropf presents the key findings.

Major donation fundraising is becoming increasingly important to nonprofits both internationally and in Austria. To date, however, there has been neither a uniform definition of the amount over which an (above-average) donation is considered a major donation, nor empirical data on how widespread such donations are within the Austrian fundraising sector.

This is the task of Fundraising Verband Austria’s recent study. 83 organizations active in major donation fundraising were invited to participate in an online survey. 26 of them took part and disclosed detailed figures on their major donation structure. In addition, in-depth qualitative interviews were conducted with 20 representatives of organizations from a wide range of nonprofit sectors with experience in this area.

The fundamental research interest behind this study was to clarify the widespread hypothesis that, compared to leading philanthropy nations, the Austrian donation system is disproportionately supported by lower- and middle-income groups, while major donations are underrepresented. Closely related to this were two more questions: where is major gift fundraising in Austria underdeveloped and capable of expansion in an international comparison, and what factors have contributed to the current situation?

The foundation landscape in Austria

While Austria had a flourishing foundation landscape at the beginning of the 20^th century with around 5,700 organisations, this was heavily impacted by the global economic crisis and the Nazi regime. Attempts to boost Austria’s charitable foundation sector post Second World War failed due to a welfare state mentality that dominated for decades and a lack of tax incentives. Only a nonprofit package introduced in 2015 brought significant improvements, followed by the establishment of foundations and, in recent years, a growing number of large donations. The Charities Reform Act, which came into force in 2024, has since established internationally comparable conditions for philanthropic engagement in Austria. Experts assume that this will further boost large donations from companies, wealthy private individuals and foundations in the future.

Research findings

Defining a major donation

But how do organizations define a major donation? We found that for 32% of the NPOs surveyed as part of this study, a large donation is between 500 and 5,000 euros. 27% answered the question with a value of exactly 5,000 euros. 18% stated a range between 5,000 and less than 50,000 euros, and 23% defined the threshold for a major donation as 50,000 euros or more.

Insights into major giving

In line with their own definition, 22 responding organizations declared their income from major donations in 2022 at EUR 46.4 million. This equates to an increase of 60% in just three years. The general donation income of the entire Austrian third sector grew by 36% in the same period (from 810 million euros to 1.1 billion euros). An analysis of the sources of donations revealed that 60% of major donations are made by companies, 38% by private individuals and only 2% by foundations.

This trend is even clearer for donations of 50,000 euros or more. Since 2020, 86% of the 22 organizations responding to this question have received at least one donation above this threshold. Of these, an even higher proportion (78%) came from companies, 16% from private individuals and 6% from foundations. In total, donations over 50,000 euros in the 26 NPOs led to a volume of 22.7 million euros in 2022 ­– an increase of 112% compared to 2020, when the total value was still 10.7 million euros.

Factors for success

The accompanying interviews with the representatives of 20 nonprofit organizations focused on the questions of what constitutes major donation fundraising and which factors play a role. In principle, the interviews confirmed that a personal relationship is of outstanding importance, with seamless interaction between major donor, fundraiser and organization identified as a key success criterion.

Based on this, key influencing factors could be identified at all levels: On the organizational and fundraising side, for example, a flawless image of the NPO, close involvement of management and board members, and a high degree of patience, consistency and flexibility on the part of fundraisers. At the donor level, it should be noted that they tend to want large, renowned organizations with strong brands as partners and are more likely to invest in “tangible” projects such as construction projects, specific equipment or endowed professorships.

The final conclusion is both sobering and encouraging:

• Austria’s major donations culture, as it currently exists, has room for improvement, but is by no means underdeveloped. A considerable number of private individuals and institutions make above-average donations and are thus committed to charitable causes.
• Especially in the areas of science & research and art & culture, there is a well-developed and established culture of large donations, strongly based on traditional patronage.
• There are still inhibiting factors for philanthropic engagement & major donations in Austria including, for example, the prevailing mentality of providing for the poor, public debates about envy surrounding the topic of wealth, but also the charitable foundation landscape, which is still less developed than in our neighbouring countries.
• Large donations make up a considerable proportion of total donations in Austria. Estimates are still difficult, however.
• The share of large donations in total donation income per organization ranges between 3% and 100%. The relevance of this form of fundraising therefore varies greatly for individual organizations.
• The data situation is also difficult due to many differences and grey areas in the definitions.
• Major donation fundraising has become more professional in Austria, but there is still room for improvement.
• Overall, there is a positive trend and therefore potential for the future. However, this is only reflected to a limited extent due to the level of willingness from organizations to invest in major donation fundraising.

For more information on this study, please email FVA at  fva@fundraising.at.

Main picture by Ibrahim Boran on Unsplash