Fundraising consultant Daryl Upsall believes that fundraising ratios (the relationship between fundraising expenses and the nonprofits’ total expenses) should be consigned to the trash can. Upsall urges the nonprofit community to reject the metric since it simply drives a race to the bottom and stops investment.

Rebecca Cooney filed this report for Third Sector:

Speaking at the Institute of Fundraising’s annual convention in central London, Upsall said that attempting to grow a charity while trying to spend as little as possible on fundraising and other administrative areas added up to trying to do the impossible.

Delegates at the session heard that traditional fundraising channels did not appeal to new generations of potential donors and were failing to bring in a sustainable number of them.

“One of the stupidest, stupidest things we do as a sector is this drive to the bottom,” said Upsall. “Who can get the lowest percentage of expenditure on administration, then we convince the public that this is good.

“What it really does – and it doesn’t matter which country in the world you operate in – is stop investment. “There’s no growing company in the world that isn’t spending some money on research and development, marketing and all the things you need to be successful.” But Upsall said that in the charity sector “we try to do the impossible: we try to spend less and therefore get better”.

He also warned that charities should try to get on board with fundraising through SMS and social media in order to attract new donors, warning that if they left it too long the opportunities would no longer be there.