This month we celebrate Ethics Awareness Month to highlight the importance of ethics in philanthropy. This initiative has been led by the Association of Fundraising Professionals (AFP) and is in its fourth year of elevating ethical practices in our communities. AFP was founded in 1960 to create a code of ethics for fundraising professionals and adopted its official Code of Ethical Standards in 1964 helping to foster the development and growth of professionals and enhance philanthropic initiatives. The 25 standards in AFP’s Code address issues such as privacy, stewardship of funds, professional responsibilities and compensation.
October is a great time to focus on ethics because it kicks off the ‘giving season’ in the last quarter of the calendar year when most charities receive one-third to one-half of their annual funds. We all integrate ethics into our work every day and ethical dilemmas arise regularly for donors and nonprofits including how beneficiaries are chosen, compliance with donor intentions, proper documentation and marketing materials. Knowing the ethical principles and donor rights is important for those working with nonprofits, advisors and donors. Philanthropy is a tradition of giving and sharing for the common good. Donors and prospective donors need to have full confidence in the respect and trust of the nonprofits and causes they are asked to support. To ensure this respect and trust AFP also declared donor rights which provides for transparent, current and accurate information as well as appropriate acknowledgement and recognition. The Donor Bill of Rights was created collaboratively by AFP, the Association for Healthcare Philanthropy, the Council for Advancement and Support of Education and the Giving Institute. It is a document which supports both donors and nonprofits in giving and receiving well.
The Catholic Church also provides guidance on ethical standards for fundraising. In November 2002, the members of the United States Conference of Catholic Bishops (USCCB) approved legislation for the implementation of canon 1262 of the Code of Canon Law for the United States. This canon provides ethical guidance for fundraising appeals to the faithful of the Church.
One of the charity watchdogs, Guidestar.org now known as Candid provides a Seal of Transparency which nonprofits are required to earn annually. There are several levels of these seals:
– Bronze – provides basic organizational information
– Silver – includes the basic information as well as program details
– Gold – includes the basic information, program details and financial documents as well as leadership demographics
– Platinum – includes the basic information, program details, financial documents, leadership demographics and strategic goals and metrics
These Candid Seals of Transparency help nonprofits demonstrate transparency and support donors and potential donors learn about the organizations they wish to fund.