Ethical Standard Deep Dive: Standard 7
Throughout the month of October, members of the AFP Ethics Committee will be addressing each of the standards in our Code of Ethics. Krista Thompson, chief executive officer with Covenant House Vancouver in Vancouver, B.C., addresses Standard 7 about presentation of products and services.
Standard 7: Members shall present and supply products and/or services honestly and without misrepresentation.
Krista: In an ever more transparent world, stakeholders and donors require information about your organization’s service outcomes, costs and the impacts that match donor intentions. But this requirement for transparency has not always been welcomed by the charitable sector.
Many years ago, boards and staff resisted new Canadian legislation that would make public annual filings, information about compensation, incorporation documents and audited financial statements. It was thought that by sharing this information, we would somehow lose competitive advantage or alienate our donor community.
In fact, increased transparency has resulted in an improved understanding amongst leaders of financial best practices and better relationships with donors who are keenly interested to know how their donations are used.
Building trust through transparency and accuracy remains the essential ingredient in ensuring your organization’s reputation, as well as fulfillment of long-term missions.
- Members shall clearly identify the details of their products and/or services, such as availability of the products and/or services and other factors that may affect the suitability of the products and/or services for donors, clients or nonprofit organizations.
- Members shall assure, to the best of their ability that the representations of their products and/or services which they propose to provide for donors, clients or nonprofit organizations are sufficiently complete and accurate.
- Members shall supply products and/or services which are consistent with the representations made to donors, clients, or nonprofit organizations.
- Members shall clearly and honestly describe their ability to deliver their products and/or services in a timely or complete manner, as well as other factors that may reasonably affect the suitability of the products and/or services.
- As a best practice, business members should state to donors, clients or nonprofit organizations that their companies are bound by the AFP Code of Ethics.
Examples of Ethical Behavior
- Including in product or service sale proposals only representations that are complete and accurate.
- Omitting from sale materials information that may be confusing, inaccurate, or incapable of being documented.
- Providing reasonable estimates as to the member’s ability to deliver the proposed products and/or services within a particular timeframe.
- Fairly disclosing factors such as limitations which may affect the suitability of the proposed products and/or services for the specific donor, client or nonprofit organization involved.
Example of Unethical Behavior
- Knowingly overstating the performance capability of a member’s products and/or services.
- Misrepresenting the suitability of a member’s products and/or services for a particular donor, client or nonprofit organization.
- Misrepresenting the ability of the member to deliver products and/or services in a final and complete form by a date certain.
- Misrepresenting the past performance of, or donor, client or nonprofit organization satisfaction with, the member’s products and/or services.
- Knowingly misrepresenting the ultimate cost to the donor, client, or nonprofit organization of the member’s products and/or services.
- Misrepresenting facts regarding the donors, clients or nonprofit organizations served by the member’s products and/or services.