Tips on Above-Board Fundraising by Tracy Vanderneck

Tracy Vanderneck

In a recent committee meeting, the attending members were attempting to find a catchy name for a presentation on ethical fundraising. Let’s be real, “How to Fundraise in an Ethical Manner” is a snooze. The committee members joked that the title should be, “Tips on above-board fundraising that will keep you out of jail!” See? Much more interesting!

Ok, hyperbole aside, understanding the lines between legal, ethical, and just plan good practice, is important for every fundraiser…really, for any non-profit employee. But the topic is so vast, it is impossible for a fundraiser to know every rule, caveat, and pitfall. Sometimes, it is just as important to know where to go for an answer as it is to have the answer yourself.

I rely on several sources for assistance when I have a question:

1. A book called Ethical Fundraising: A Guide for Nonprofit Boards and Fundrasiers. This Association of Fundraising Professionals’ (AFP) publication is a compilation of articles from various authors. It was compiled in 2006/2007 and covers such topics as: 1. Conflicts of interest, 2. Compensation for development professionals, 3. Tainted money, 4. Relationships between grantees and funders, 5. Public perception, and more.
2. AFP’s website http://www.afpnet.org/. This web site has downloadable copies of The Donor Bill of Rights, as well as of AFP’s Code of Ethical Principles.
3. Board members with industry expertise. I have found that having a CPA on your board can help you stay ahead of state regulations (for example, rules on sales tax at non-profit auctions if you auction more than three times in a given twelve month period). Having a board member who is willing to research and interpret laws for you is invaluable. This might take working with your CEO and Governance Committee to target future board members in specific industries.
4. Other fundraisers. When you aren’t sure, it is good to put in a call to a development professional or fundraising consultant that is senior in the field. They may have experience with the situation in question, or they may know where to go to find the answer. This may seem like a simple thing, but sometimes just knowing who to ask solves the problem.
5. “Big” non-profits. If you work in a small shop and are the only fundraiser, don’t try to guess or reinvent the wheel. If there is a question about whether a particular practice is acceptable and/or ethical, chances are the larger non-profits (e.g. American Red Cross, American Cancer Society, Susan G. Komen, etc) have come across the same issue. And those organizations have legal departments to find the answer for them. So do some networking and make a friend at a big organization! Ask them if they are willing to mentor you, or just be a sounding board for questions should they arise.

Doing a little reading on the front end, and looking at all of your activities with a critical eye, will help you identify potential problem areas and help make sure you are operating within accepted norms. Over time, your donors will notice that you conduct your fundraising within industry standard ethical guidelines, and that will go a long way in securing donor trust and confidence in you and your organization.

Tracy Vanderneck is the Director of Annual Giving at a Manatee County non-profit and is working towards her CFRE. Tracy is in her fifth year working in the non-profit sector and was most recently the Director of Development at the American Red Cross Manatee County Chapter. The first 11 years of her professional career were in sales of management and interpersonal communication skills training courses and consulting services.

Is it Ethical? by Norman Olshansky, President & CEO, Van Wezel Foundation

One of the most important aspects of being a member of AFP is our commitment to the Code of Ethics of our profession. The code has been one of the most significant elements that establishes fundraising as a respected profession. It has set us apart from hucksters who are unprofessional and unethical…….those who are willing to do anything with or for donors in order to raise funds for their “charitable” endeavors.


Unfortunately, the code only applies to members of AFP. However, by upholding our ethical code, being positive role models and educating the public, we raise the overall level of professional and ethical fundraising in the communities we serve. We have an obligation to not only instill ethical behavior within the organizations we serve but also among donors and others involved in the nonprofit sector.

As many of my colleagues are aware, for many years I was involved as a consultant with clients around the Country and was unable to be very involved locally with AFP, even though I formerly served on the Board of our chapter. Since joining the staff of the Van Wezel Foundation, a fundraising ethical issue came up which may be of interest to you, my colleagues.

Evidently, there is a history where local commercial magazines sponsor events with nonprofits with the proviso that no other magazine be allowed as sponsors. In other words, they ask for and receive an exclusive relationship. The Van Wezel Foundation, in the past, has also accepted such arrangements. When I came on board, I felt that exclusive relationships posed an ethical issue and have stopped the practice.

Are such “agreements” a violation of our code of ethics?

I feel that if we allow exclusivity with a commercial enterprise we end up telling other donors from a similar industry that we can’t accept their comparable donation or sponsorships. My position is that donors who care about our mission should be welcome and recognized appropriately. It would be like a lawyer or doctor telling a nonprofit that they want an exclusive relationship with the organization, thus preventing the organization from accepting and recognizing other gifts from those professions.

The very first two sections of our code state:

1. Members shall not engage in activities that harm the members’organizations, clients or profession.
2. Members shall not engage in activities that conflict with their fiduciary,ethical and legal obligations to their organizations, clients or profession.

One might take the position that the code only applies to individual members and not nonprofit organizations. While an organization may not be subject to the code, AFP members in that organization can indeed be held accountable for actions in that organization.

Is it a violation of the Code for a member to go along with an unethical activity, policy or behavior which is the decision of and implemented by others?

If we do not stand up for ethical behavior in the nonprofit sector, who will? If we observe or learn about unethical behavior shouldn’t we try to educate and work towards the elimination of that behavior?

It is with the above in mind that I want to stimulate a discussion about exclusivity practices requested by donors. It’s hard for an individual member to change a long time practice in a community but if we agree, as a group of professional colleagues, that such practices are inappropriate, even if not technically unethical, we can indeed influence change.

What do you think? Would your organization accept such a requirement from a donor? If so, under what conditions? If not……….why?

Are there other issues involved with this example that have not been addressed above? What if it were your largest donor who set such a condition on their gift?

In our case, following a serious discussion and educational session with the magazine, they backed down and we now have several magazine media sponsors of our gala.

I would suggest that we as professionals need to avoid even the slightest perception of ethical impropriety and by challenging these practices, we help to educate the donor community how we are different from the profit making world where these practices are common and within ethical business practice. I don’t blame the companies for asking for preferential treatment but that doesn’t mean we have to accept the practice.

What do you think?
 
 
Norman Olshansky is the president and CEO of the Van Wezel Foundation.