Editors’ note: This article, first published in print during Jul/Aug 2006, has been republished for Nonprofit Quarterly with minor updates.

Whether professional or volunteer, as fundraisers we run up against a number of ethical dilemmas in the course of our work. Ethical issues are often quite straight-forward: It is not OK to tell a funder or a donor that you are engaged in a certain kind of program if you are not, no matter how much money that donor might give you if you were. Similarly, it is not a good idea to take on a program area or a piece of work just because someone has or might offer to fund it. This quickly results in mission drift. It is not OK to agree to hire your donor’s worthless son-in-law to be your organization’s program director or bookkeeper in exchange for a major gift. It is not OK to keep two sets of books — one for the public and a different, truer accounting that remains internal to the organization. Many of these ethical or moral issues are addressed in standard accounting procedures and in the very excellent Association of Fundraising Professionals Code of Ethics, as well as the Donor Bill of Rights, which can be found on their website at www.afpnet.org.

But there is a subset of ethical issues that fall into more of a gray area that are usually the development director’s job to navigate. These dilemmas often happen because the right thing to do is not completely clear and because the development director has conflicting loyalties. Let’s look at some examples.

  1. A think tank with a staff of five people is offered the opportunity to buy their office building from their landlord at a very reasonable price. However, the building will need a great deal of work and the organization has never thought about owning property. The board chair is very enthusiastic about buying the building, but the rest of the board is not, and neither is the ED. They feel the building needs too much work and that owning and rehabbing the building could take staff away from the actual work of the organization. You agree with the ED and also think it is not a good idea to do something that so few people are enthusiastic about. You share your thoughts with the ED. You are, however, surprised when the ED announces to the board that he has talked to one of your biggest donors, who is in real estate, who has said it is not a good idea for nonprofits to own buildings. You know that no such conversation has taken place. The board chair graciously says she will defer to the donors’ knowledge, and the matter is dropped.
  2. Your organization receives a grant for $50,000 and the grant agreement asks you to check a box that reads: “Our organization has taken appropriate steps to ensure that none of our employees or board members support terrorism or are involved in any organization that knowingly or unknowingly supports terrorism.” You are faced with two facts: first, that you have not taken any steps in this direction, and second, that the organization feels that this antiterrorism language is unconscionable and that being asked to do so is possibly unconstitutional. You call your program officer who says, “Just check the box — it is all a facade anyway. Obviously, we wouldn’t fund you if we thought you were terrorists.”
  3. The chair of your board introduces you to her elderly aunt, who is interested in your organization’s work. On the advice of the board chair, her aunt has decided to offer the lead gift for a program your organization has wanted to launch; moreover, the donor is willing to give this generous amount for three years. You and the board chair are thrilled. As your meeting with this woman is winding up she says, “I just have one question for you: Does your staff go to church regularly?” You do go to church, but your executive director is an atheist, and the two program staff who will run the program are Jewish. One is religious and one is not.

In these examples, there is one easy way out: just let it go. So what if the ED made up a conversation in order to end the discussion about buying the building? That was probably the right decision anyway — certainly it was the one you agreed with. So what if you check the antiterror-ism box on the grant agreement? It will just sit in a file anyway. Clearly, the funder doesn’t care that much. So what if you make it sound as though your staff are active in houses of worship? The donor probably won’t pursue the question further. On the scale of one to ten, with ten being a big lie, these are all twos and threes.

However, as the saying goes, giving in to any of these “So whats” leads you down a slippery slope. Each of these examples bears a deeper examination to ferret out the ethical and practical complications and to see if there is another approach to these problems.


There are three tools that can help you avoid feeling the need to deceive, demur, or lie in any fundraising situation (and possibly in any situation).

First, follow the Quaker adage, “Assume good intent.” That is, assume that people you disagree with may be acting out of positive motivation. Second, follow a main principle of assertive-ness training by making only “I” statements. “I felt,” “I wonder,” and so on. Third, use a “gut check.” Does this feel bad or weird? What if this whole story were in the newspaper — would I feel proud of my role in this?

Using these three tools, let’s look at the dilemmas in two ways: with good endings and with more difficult endings.


First, let’s look at how these situations could have easy, good endings.

In the first instance, a gut check says, “This is weird.” Deceiving a board member is not a good idea. You need to talk with the executive director about his story. First of all, the board member may well know the donor whose name was invoked and if she runs into him and thanks him for his clarity, your executive director will be found out and your board chair will be embarrassed and hurt.

Second, if the board chair is a good person and good worker, why not see if she understands the fact that a capital campaign cannot succeed without total enthusiasm from everyone?

However, assuming good intent, you ask the executive director why he thought his story was the best way to solve the problem. Regardless of his rationale, you can then use “I” statements to make your position clear. For example, if the executive director explains that he didn’t want to hurt the board chair’s feelings and is quite certain she doesn’t know the donor in question, you could say, “I would rather see if she understands the need for full staff and board support for a big project. Otherwise, something else may come up that she supports and others don’t and we’d be in a similar situation.”

Here’s how such a scenario might play out: the executive director agrees to have a meeting with you and the board chair. He tells the board chair that he exaggerated a conversation with a donor to avoid hurting her feelings and now feels bad about it. He realizes she is perfectly capable of understanding why pursuing the building did not seem like a good idea to him. You offer support for his position, including telling the chairperson how important she is to the organization and how no one ever wants to dampen someone’s enthusiasm. She is understanding and as is her nature, gracious. She does say lightheartedly as the meeting ends, “Don’t worry about my feelings in the future. I’m tougher than I look.”

In the second instance, the situation is clearer. Your organization is opposed to this antiterrorist language, as, apparently, is the funder. However, the funder seems comfort-able with complying with the letter of the law while not pursuing it further. You, the grantee, are asked to deceive in two ways: to check a statement that you don’t agree with and to aver that you have complied with something that you have no intention of complying with. You are not going to interrogate staff and board about their affiliations outside of work. That would be no better than checking a box that said, “We make sure that everyone on our board and staff has citizenship papers,” or “We make sure that no one on our board and staff has ever had an abortion.” Your “gut check” tells you the situation is wrong.

As the development director, it is your job to bring this agreement to the executive director and the board, as they are ultimately responsible for these contracts. If they say “Check it and forget it,” then you have a bigger decision to make: can you in good conscience stay in your job.

In this case, however, it doesn’t come to that. The organization asks the funder to challenge this language in their own professional associations. They do, and they learn that other organizations have also been unwilling to check the box. As a result, they allow your group to turn in the agreement with that statement crossed out and you become part of a coalition of funders and organizations publicly opposing this kind of screening.

The third example is one in which “assume good intent” is the primary authority for your actions. You have no idea what the donor wants to know when she asks if you and other staff go to church. Perhaps she is just making conversation and in her circle of friends, this is a common question. You would answer, “I am active in First Methodist. And the two people running the new program are Jewish. One goes to Temple Emmanuel and I don’t know so much about the other’s life. Are you involved in a church?”

You might be surprised when she answers, “I’m an Episcopalian. I think churches and synagogues might be interested in this program, and some of them might be able to provide some money and volunteers. Perhaps one of the program people can talk to my churchwomen’s group and to their own religious groups once the program is up and running.”


Of course, all three of these situations could have gone another way. Let’s look at how we might work with more difficult endings.

In the first circumstance, the executive director becomes quite defensive when you discuss his fabrication and refuses to talk to the board chair about it. He says that he has made up things before in order to “get things done” and that you need to be more practical. Your dilemma now moves to a different level: Do you want to work with someone who you know will make up stories (possibly to you) in order to get his own way? This would not be an easy decision, particularly if you like the organization or if jobs are hard to come by. But over time, the price of supporting some-one who regularly exaggerates may be too great.

Unfortunately, defensiveness is far too common in our world. Many people equate disagreement with disrespect, which makes it impossible to have a discussion in which conflicting viewpoints are aired. Everything is taken far too personally, and there is a limited ability to separate action from personality. “I disagree with you” is heard as “You are wrong and stupid.”

I have worked with many people in leadership who demand the loyalty of a dog to its owner from their staff. They can change, but this usually requires intervention from someone they respect and some training in how to respond nondefensively. Sometimes people (defensively) deny that they are defensive, but they truly may not realize the effect of their tone or body language. Simple changes can make a world of difference.

Other people’s insecurity rises out of a fear of being punished. “I disagree with you” becomes, “You are a bad worker.” We have a joke at my office about some people that their middle name is “It-is-not-my-fault.” Making sure you give credit and praise more often than criticism goes a long way to helping the person trust you enough to be able to hear disagreement.

Finally, of course, our culture is conflict-averse. When we read about things people are terrified to do, such as public speaking or asking for money, I sometimes think that at the top of that list would be starting a conversation that might lead to conflict. Some organizations are doing in-house trainings on conflict and conflict resolution in order to strengthen their ability to be in creative dialog with each other and to surface disagreements early before they fester and become huge explosions.

None of the manifestations of defensiveness are good leadership qualities; of course, all of us feel defensive from time to time. Thinking about what makes you feel on the defense and what helps you to let go of that defensiveness will help in dealing with others. People who want to be effective leaders are always working on not taking things personally.

From an ethical point of view, understanding the reasons that someone behaves unethically can lead to compassion and may provide a way out of the dilemma, but it cannot be the reason you do not confront unethical behavior.

In the second situation, the funder says that if you don’t check the box and stop making a big deal out it, they will be unable to make the grant. Here again, the situation is clearer. Find out more about what the law says and stay in a negotiating posture with your funder. Generally, funders do not like to pull grants any more than organizations like to give up the money. In the third case, the donor says she prefers organizations where all the staff is involved in a church. Invite her to meet all the staff and hear from them personally before she makes a final decision. If this donor demands that people be active, churchgoing Christians in order to make her gift, you must politely decline her offer.

By continuing to negotiate in any situation, you stay in a place of integrity but not self-righteousness. Having been in many serious moral and ethical quandaries with regard to fundraising, I have always felt best, and felt that the best outcome resulted, when I told the truth — that is, what was true for me — without insisting this was the only or even necessarily the complete truth. Offering options and asking to stay in conversation usually resolved the problem amicably.

As you can see, some of your willingness and ability to operate completely ethically will come out of having a diversity of funding sources so that no one person or source is so important to you that you are even tempted to give up your values for money.

It is also true that some things can’t be resolved. Then the question is, What is the price of your own integrity?