Ethics: The Nonnegotiable Currency of Fundraising
Fundraising Academy | Cause Selling Education
Written by Jarrett R. Ransom, MBA
October 14, 2025
Nonprofit fundraising has always relied on trust. Today that trust is under even closer scrutiny. With the rise of artificial intelligence (AI), the public accessibility of Form 990s, donors’ growing demand for financial transparency, and more visibility into how organizations operate, the way you and your organization manage ethics is critical. Your donors and prospects want to see how resources are allocated. It’s also common for donors to compare organizations side by side, and when communications feel impersonal or inauthentic, they often change the way they engage. This means ethical practices are essential for credibility and the long-term success of your mission.
This is where the Cause Selling model provides a valuable roadmap. It reminds us that ethics is not an isolated step in the fundraising process. They show up in all eight steps, from prospecting and making the first connection to presenting, closing, and stewarding relationships. Every interaction is an opportunity to demonstrate transparency, authenticity, and respect.
Here are five ethical principles to follow in your practice:
Show Donors Where Every Dollar Goes
One of the most visible ways ethics show up is through transparency. Donors want and deserve clarity on how their contributions are used. Since Form 990s are public and easily accessible online, nonprofits should assume that donors will review them. And let me tell you, they do! In fact, some of the best organizations make their 990 easy to find by posting it directly on their website. Instead of shying away from questions about overhead or salaries, ethical fundraisers lean into honest conversations, helping donors understand that strong infrastructure is what fuels programmatic impact.
Balance Tech Innovation with Integrity
Just as donors value clarity in financial reporting, they also expect organizations to use technology ethically. This becomes especially important in the age of artificial intelligence (AI). AI tools can help segment donor data, draft outreach communications, and analyze giving patterns with impressive efficiency. But over-reliance on automation risks making communications feel transactional instead of personal. Ethical use of AI means ensuring these tools enhance donor relationships rather than replace them. Every message should reflect the organization’s authentic voice and its commitment to treating donors as valued partners, not data points.
Protecting donor privacy takes on new urgency in this AI-driven world. With more personal information being collected, stored, and analyzed, nonprofits must consider how they are safeguarding data. Secure systems, clear policies, and responsible use of information are essential. Donors expect their personal information to be treated with care and protecting it is one of the most tangible ways to reinforce trust.
To learn how AI can help you deepen donor engagement while staying true to your mission, watch our recent webinar.
Keep Truth at the Heart of Every Narrative
Beyond protecting information, respect must also guide how we represent the people we serve. Storytelling is one of the most powerful tools nonprofits have, but stories must remain truthful and respectful. Exaggerated appeals or manipulative imagery may spark short-term giving, but they undermine credibility in the long run. Authentic stories, grounded in real experiences, not only honor dignity but also build deeper, lasting donor relationships.
Respect Donors While Protecting Your Mission
Just as stories must reflect truth and respect, so must our relationships with donors, especially when their influence could shift our mission off course. Large gifts sometimes come with expectations that don’t align with organizational priorities. Accepting these gifts can create mission drift and weaken long-term focus. That’s why having a Gift Acceptance Policy is important. Staying true to your mission, even if it means declining a gift, protects both the organization’s integrity and the donor’s respect. Yes, you can decline a gift, and we see this happen more frequently across the sector.
Honor the Purpose Behind Every Gift
Respecting donor intent is another cornerstone of ethical practice. Every contribution represents trust. If a donor designates a gift for a specific program, those funds must be used as promised. Redirecting dollars without consent, even with the best intentions, erodes trust. Clear agreements and proactive communication not only set expectations but also reinforce a culture of accountability.
A powerful example of honoring donor intent comes from an organization I recently worked with. They discovered unused grant funds from a prior agreement. A grant report had already been submitted, broadly outlining how the dollars were spent. While much of the grant had been used appropriately, a leadership transition revealed that an additional $50,000 had never been spent on the project.
My recommendation was for the organization to contact the funder and be transparent about the unused dollars, offering two options: (1) return the remaining balance, or (2) request permission to apply the funds toward continuing the work, even though the contractual grant period had ended.
The funder’s response was gracious. They appreciated the organization’s honesty and generously allowed the remaining funds to be used to advance the work outlined in the original grant. That’s a win-win!
Examples like this highlight why fundraisers need clear ethical frameworks to guide decision-making. Fortunately, our profession offers such guidance. The Association of Fundraising Professionals (AFP) Code of Ethical Standards provides direction on accountability, honesty, and donor stewardship. Paired with the Cause Selling framework, these principles ensure that fundraising is not only effective but also principled.
Final Thoughts
Ethics is not a single step in fundraising; it is the thread that runs through every interaction. Ethics keeps trust at the center, from financial transparency and the responsible use of AI to protecting donor intent and applying professional standards. When nonprofit leaders make ethics their compass, they not only strengthen credibility but also deepen donor relationships and keep the mission at the heart of every gift.
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