In a Letter to the Editor of The Chronicle of Philanthropy entitled “Donor Privacy Is Essential. Stop Asking Lawmakers to Force Disclosure,” Philanthropy Roundtable’s Director of Policy Research Jack Salmon responds to recent proposals by Giving Review Senior Fellow Craig Kennedy that would force nonprofits to name their donors.
Read the Letter to the Editor, published in The Chronicle of Philanthropy, below:
Escalating calls to force charities to say who’s supporting them may lead to harassment of donors and dampen charitable giving.
In recent months, there has been increased congressional interest in foreign donations to charitable organizations, specifically regarding the sources and intent of those dollars. Craig Kennedy responded to these concerns in two op-eds — “The Nonprofit World Should Embrace, Not Fear, Congressional Interest in Donor Transparency” (November 2) and “An Unlikely Event – the Israel-Hamas War – Could Finally Spark DAF Reform” (December 6). Unfortunately, embracing the proposals he puts forth would both erode donor privacy protections and put charitable giving at risk.
To start, Kennedy suggests “greater disclosure of foreign donations.” As a foreign national living and working in the United States, this hits close to home. Is Kennedy suggesting my charitable donations be subject to foreign donor disclosure requirements? What about those with dual citizenship? This is not only an invasion of privacy but carries deeper implications. Donor privacy ensures individuals can back charitable endeavors without concern over potential harassment, coercion, or reprisal.
In international philanthropy, protecting donor privacy is paramount, which is why it’s baffling that donor-advised funds — which allow Americans to keep their personal giving private — are also viewed by Kennedy as “controversial.” Let’s be clear: Any cause can be deemed controversial by someone who doesn’t share the donor’s values, politics, religion, or other beliefs. There’s no population feeling this more right now than the Jewish community, which is facing a 360 percent surge in antisemitic incidents since Hamas’ Oct. 7 attack on Israel.
It’s true donors could use DAFs to fund anti-Israel groups. It’s also true Jews can use them to provide critical aid to Israel, fight antisemitism at home, and protect themselves from threats, violence, and even death by remaining private. Kennedy’s advocacy for transparency ignores a crucial question: If the nonprofit organization receiving the funds is operating legally, how are DAFs problematic?
The repercussions of forced disclosure aren’t limited to donor safety. Historically, disclosure requirements also have a chilling effect on civic participation.
What’s more, foreign gifts to U.S. charitable causes benefit vulnerable Americans, and reducing those donations would have far reaching implications. Why should the donors from 44 countries who collectively gave more than $43 million in the days after the Maui wildfires, for example, be forced to disclose their identity?
In his November op-ed, Kennedy says the quiet part out loud: “Greater disclosure of foreign donors should be an easy place to start.” Whether it is COVID-19 relief, disaster recovery, or policy philanthropy, if foreign donor disclosure is the starting point, what is the end point? The First Amendment makes no distinction between donations to charitable causes and those directed at policy. In fact, it upholds the fundamental role of charities in participating in the discourse of public affairs, and through decades of precedent, the U.S. Supreme Court has reinforced that right. As a result, policy philanthropy has been an integral part of a vibrant civil society.
Anti-privacy activists continue to push for forced disclosure requirements. But they fail to distinguish between contributions to policy-oriented nonprofits, which aren’t political in nature and are therefore allowed, and direct political support for candidates and parties. As Craig Kennedy has argued in his November op-ed, “laws and regulations age.” But Americans’ constitutional rights do not: Reforms that chip away at those rights are a solution in search of a problem.