Sponsorship and donations revenue up, but volatile and uneven

Sponsorship and donations revenue up, but volatile and uneven

Revenue from corporate sponsorship, donations and net fundraising events within the major performing arts sector continues to track ahead of CPI levels, increasing by $15.4 million or 16.1 per cent on 2016 results to $111.1 million in 2017.

Of this total, 65.1 per cent was received as donations, 32.2 per cent was from corporate sponsorship and a net amount of 2.7 per cent came from fundraising events.

The 16.1 per cent growth in total private sector earnings was significantly higher than the growth reported in the groups total earnings of 4.3 per cent.

Private giving now makes up 19 per cent of total income in 2017 up 17 per cent in 2016.

Revenue from corporate sponsorship, donations and net fundraising events within the major performing arts sector continues to track ahead of CPI levels, increasing by $15.4 million or 16.1 per cent on 2016 results to $111.1 million in 2017. Of this total, 65.1 per cent was received as donations, 32.2 per cent was from corporate sponsorship and a net amount of 2.7 per cent came from fundraising events. The 16.1 per cent growth in total private sector earnings was significantly higher than the growth reported in the groups total earnings of 4.3 per cent. Private giving now makes up 19 per cent of total income in 2017 up 17 per cent in 2016.

Commenting on AMPAG’s release of its latest annual survey of fundraising by the MPAs —Tracking changes in corporate sponsorship and donations 2018 —Executive DirectorBethwyn Serow said ‘The support of individual donors, trusts and corporate partnerships is incredibly important for the arts sector.

While revenue from sponsorship has been growing in line with CPI, donations have gained more share of the total revenue, tracking well ahead of CPI and driving the overall increase in earnings for the sector. The consistent and heartening increase in both the number of donors (up 15.9%) and in the average donation value (up $179), reflects a broadening base of and increasing engagement among donors.

‘With 50,379 donors supporting the MPAs in 2017,up 6,897 people on 2016 is further testament to the growing recognition of the importance and value of the arts for Australians. This support has helped to enable the companies to develop artists and creatives, as well as commission new works, strengthen sector infrastructure and ensure broad access to large scale and highly accomplished performances, quality arts education programs and workshops and continue their custodianship of their respective artforms’ said Bethwyn Serow ‘and there is always more that needs to be achieved.

‘However, donations income is a volatile source of revenue, and the peaks and troughs in the rate of increase in earnings over the past 17 years highlight the unpredictability of this source of income for individual companies. In 2017, 14 companies reported an increase in donation income greater than 20 per cent, while nine companies reported earning less from this source compared to 2016. ‘Fund raising growth has been driven in part by a high number of special one-off capital fundraising campaigns and we may see further ‘corrections’ in future years,’ said Ms Serow.

Cost efficiency on the raising of donations has improved by 22% on 2016 levels, with costs at 14.5% of total donation income compared to 18.6 % in 2016. This is the lowest ratio recorded since 2007. Despite more people being employed to raise donation income, the additional income raised is greater than the added cost.

In 2001, corporate sponsorship made up 71.6% of total sponsorship and donations revenue. By 2017, this share had fallen to 32.2%. Reported sponsorship earnings of $35.8 million weredown $1.3 million (3.6%) on 2016 results, and down $0.4 on 2015 but $0.3 million above 2014. This brings the overall results closer the 2011 levels adjusted for CPI. The decrease was evenly spread with 14 of the 28 companies reporting decreases on 2016.

Cash sponsorship is giving way to in-kind support. Since 2001, cash sponsorship has increased by just $5.8 million (a decline in real terms) and in-kind support has increased by $9.6 million, driving the growth in this sector. Cash sponsorship is more beneficial to major performing arts companies as it provides greater financial flexibility and is more readily quantifiable, but it is becoming increasingly harder to obtain and more difficult and expensive to service.

Fundraising and event income net earnings of $3.0 million reported by 21 companies were down 23.6% on 2016 levels and were dominated by nine NSW companies that made up 83.9% of the result. Four companies reported major decreases and a further eight reported small declines.

AMPAG Chair John Irving said ‘The overall results are to be celebrated. Philanthropy is a key enabler of artistic development, as well as infrastructure, but I am also aware that the environment in which funds are raised varies across state jurisdictions, as does the size and reach of the individual companies. Growing sponsorship and philanthropic support takes time, resources and a willingness to deepen the public’s understanding, not only of the organisation today- but also a sense of what they could become and what might be developed for future generations.’

For further details, including results by state, company, size and art form, see attached:AMPAG Tracking changes in corporate sponsorship and donations 2018 Summary.

The 2018 AMPAG Tracking changes in corporate sponsorship and donations report was prepared in partnership with Creative Partnerships Australia.

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