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Promoting Ethics as a Guiding Force

October 3, 2005

(Oct. 3, 2005) 'What can or should be our professional response to promoting ethics as a guiding principle in ethical fundraising?' To answer that question, the 2005 AFP Think Tank on Fundraising in Washington, D.C., on Sept. 7-8 involved a lively discussion of theoretical principles and practical issues affecting the work of philanthropic fundraising.

The AFP Think Tank on Fundraising was chaired by Janice Gow Pettey, CFRE, principal, J.G. Pettey & Associates in San Francisco, and sponsored by the AFP Research Council and the AFP Ethics Committee. Co-sponsors included the AAFRC Trust for Philanthropy, the Council on Foundations, United Way of America and the Indiana University Center on Philanthropy.

Additional support was provided through the AFP Foundation for Philanthropy by the AFP Florida, Ft. Lauderdale/Broward County Chapter; the AFP Ohio, Miami Valley Chapter; the AFP Pennsylvania, Greater Philadelphia Chapter; the Patricia F. Lewis Ethics Endowment; Leslie W. Brown, CFRE; and Tyrone Herring, CFRE. Charity Channel contributed its audio editing expertise and will produce educational audio segments for playback on AFP's website.

More than 50 invited professionals from a wide range of organizations in the United States, Canada and Puerto Rico took part in the two-day event that focused on the following goals:

  • Identifying core issues important to promoting ethics as a guiding principle in philanthropic fundraising
  • Defining short-term and intermediate indicators of success--by issue
  • Assessing the environment in which initiatives will occur
  • Proposing action agendas to start the promotion process

Ethics in Civil Society

Ethics is defined as 'the discipline dealing with what is good and bad or right and wrong or with moral duty and obligation, a group of moral principles or set of values and the principles of conduct governing an individual or a profession.' Also, ethics is 'character or the ideals of character manifested by a race or people (from the Greek ethos).'

Thus, it is easy to see why ethics can be both a business and an art with many gray areas and little in clear black and white. The panel session on 'Confidence in the Philanthropic Sector: The Value of Building Trust' highlighted the perceptions and the realities of the sector, as well as the 'power of the myth of the sector.' Nonprofits are 'the dark matter that hold the universe together. They are difficult to quantify and not well understood,' one participant said.

The group discussed how the public's trust in philanthropy failed after the terrorist attacks on Sept. 11, 2001, and has not yet recovered. In addition, some felt that the perception of philanthropy was changing, being seen more as a 'big business.' 'How does the initial passion get transferred to a more sophisticated board, staff and volunteers?' participants asked.

An organization's response to the concept of building donor trust can focus on three main areas, the participants agreed:

  • Educate board members. First steps should include orienting all members to the organization's mission and involving them in programs.
  • Communicate with donors. Have a communications plan and implement it! Clarify and reaffirm your mission and case with donors through all communication avenues. Also, involve the executive director or CEO in all aspects of communications
  • Fulfill donor intent.

Discussions on accountability and regulation revealed the opinion that charitable donors have lost patience with nonprofits' misallocation of their funds and their ability to be honest brokers between donor and beneficiary. And Sarbanes-Oxley? 'It focuses attention on 'eating your spinach' issues--what you need to do to be healthy.'

'It is a fascinating time for nonprofit organizations,' one participant noted. 'We must answer the question of how nonprofits are judged. One of the purposes of transparency is to avoid regulation. We must take charge of the conversation or someone will do it for us.'

Another participant offered this simple test: 'Take any sentence your organization wants to speak and imagine it as a newspaper headline.'

Analyzing Priority Factors

In addition to panel discussions and presentations from speakers from universities, nonprofit organizations and the U.S. Senate Banking Committee, roundtables and group sessions offered ample opportunity to explore such issues as self regulation and legislation of fundraising, asset retention, teaching about ethics and the effectiveness of the AFP Code of Ethical Principles and Standards of Professional Practice.

In one session, each of five working groups took one of the following priority factors influencing how the profession could promote ethics--integrity, transparency, public trust, enforcement and organizational bottom line--and developed answers to four questions:

  1. What is the current state of affairs--how does the profession look now?
  2. How should we look in one year?
  3. How should we look in three to five years?
  4. What are initial steps that should be considered to create the one-year change?

Participants felt that all five priority factors needed improvement:

Integrity is regarded as fundamental now, one group noted, but organizations are not consciously working on the issue, possibly because it may be regarded as optional or because not everyone understands integrity in the context of fundraising. To change that, participants discussed possible solutions, including having recertification involve questions on ethics and having an ethics education coordinator in each AFP chapter as a chapter board position.

Another group felt that transparency currently could best be described as 'unclear,' 'undefined,' 'inconsistent' and 'mistrusted.' In order for transparency to have a consistent message with recognized value, participants suggested having a yearlong educational campaign, in segments, at the chapter level, as one possible solution.

Public trust is confused and somewhat negative today, participants noted, but there are opportunities. In order to achieve more community focus on mission, suggestions included building legitimacy and credibility through open dialogue; educating, engaging and empowering board members to participate; and media outreach, to name a few.

Enforcement also could be much better, another group said. New AFP members, prospects and the general public are unaware of the Code or the enforcement process, expectations or the consequences when violations occur, participants pointed out. Looking ahead, continued self-regulation is necessary, the group noted, with more aggressive promotion of the Code, its application and the potential consequences of noncompliance.

The organizational bottom line is a 'big pressure point,' one group agreed, with the focus occasionally on dollar outcomes rather than on the mission--who we are and why our organization exists. Ethical concerns and the dollar bottom line are linked, participants said. How do we make ownership/existence of organizational values statements a reality? Participants suggested strategic alliances, targeting a number of national organizations as examples of 'best practice' values and using them to 'infect' others, as well as educating specific publics about values statements, among others.

To learn more about ethical dilemmas, be sure to sign up for the next AFP Audioconference on Wednesday, Oct. 5, 2005, at 1 p.m. EDT. Eugene R. Tempel, Ed.D., CFRE, executive director of the Center on Philanthropy at Indiana University in Indianapolis, will discuss values that form the foundation for ethical behavior.

Beginning with the AFP Code of Ethics, Tempel will examine some of the standards in terms of the values they promote and then move to ethical dilemmas--two goods or two values in conflict. What process should we go through to solve these dilemmas? Who should be involved in the decision? How do we communicate and implement decisions?



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