Ethical Standard Deep Dive: Standard 23
Throughout the month of October, members of the AFP Ethics Committee will be addressing each of the standards in our Code of Ethics. For Standard 23, AFP’s General Counsel and Ethics Committee Staffer Jason Lee explores another important of fundraising ethics: self-gain.
Standard 23: Members shall neither offer nor accept payments or special considerations for the purpose of influencing the selection of products or services.
Jason: Standard 23 was promulgated to remove self-gain from the fundraising ethics equation. It (unfortunately) is not unheard of for vendors to encourage fundraising professionals in an organization to switch over to their products or services in exchange for some sort of payment or benefit to that fundraising professional.
These encouragements can come in the form of cash payments. But other examples could include an in-kind gift of more than token value, an invitation to a sporting event paid by the vendor, or an invitation to attend a client “thank you” event, which is essentially an offer of a paid vacation.
You can easily see how self-gain could negatively impact the decision-making process given those potential inducements. The main issue is that it could result in the organization procuring an inferior product or service that would reduce its ability to serve its mission based upon the decision of a single individual who received a tangible benefit in return.
Standard 23 ensures an even playing field where programs and services as weighed solely upon their merits, effectiveness, and potential fit within an organization.
- Offering or accepting personal inducements for the purpose of influencing the selection of your services is unethical.
- The offer or acceptance of payments or special consideration for the purpose of influencing the selection of products or services potentially undermines an organization’s mission.
- Members must not enter into agreements where personal inducements are offered for retaining the member’s services.
- Members must not enter into an agreement with prospective clients who require personal inducement as a condition for the business.
- So-called “client loyalty programs” (such as hotel points or airline miles) are exempt provided that they are widely and transparently available to all customers of an organization.
- This standard and the AFP Code do not apply to business to business relationships (e.g., Business A pays an incentive to a 3rd party marketer or a sales representative to generate business leads).
Examples of Ethical Behavior
- Refusing an inducement if it is offered by a member or any other party to influence the selection of products or services.
- Not accepting business from a client who asks you to directly or indirectly provide them with contingent compensation of any kind (e.g. monetary, vacations, job offers, etc)
- Helping a vendor, marketer or other seller understand that all transactions with a nonprofit organization are to benefit the organization and its beneficiaries and not to benefit individuals employed or volunteering for the nonprofit organization.
- Promoting the transparency of all transactions with nonprofit organizations and their vendors.
Example of Unethical Behavior
- Paying a gratuity to someone for identifying or choosing a particular product or service.
- Stating either directly or indirectly that selection of your services or products will benefit the client with a monetary or non-monetary fringe benefits.
- Suggesting that a member might look favorably upon a certain product or service in light of the offer of a suitable inducement.
- Accepting a payment in return for recommending a particular product or service to one’s organization.