Ethical Decision Making in Fund Raising (AFP/Wiley Fund Development Series) / Edition 1

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". . . this is not a visionary book. . . . My aim in this book is to help people of ordinary decency and ordinary courage to accomplish their purposes, to help them build organizations in which sainthood is not a requirement for success, but where having ordinary decency and courage is enough."

With these words, author and philosophy professor Marilyn Fischer poses questions, offers guidance, and outlines a practical decision-making model nonprofits can use as they decide how and from whom to solicit donations. Part philosophical treatise on the nature of giving and community and part commonsense manifesto on ethics as a tool, Ethical Decision Making in Fund Raising outlines a course of action for the CEO and staff of a nonprofit that gives life to a nonprofit's core values-organizational mission, relationships, and integrity'and its faith in our common humanity.

A handbook for ethical reasoning and discussion, Ethical Decision Making in Fund Raising provides resources with which fund raisers can analyze ethically troubling situations and make choices for their organizations. Ethics and its expression in the workplace are framed and examined in the form of an ongoing narrative, not unlike life itself. When viewed from the perspectives of all the personalities involved, an ethical dilemma faced by a nonprofit begins to resemble a real-life conflict, and it is just this sort of examination that Marilyn Fischer encourages. Problems in life and in art are dynamic, affecting us, our neighbors, and our future. This perspective and the conceptual resources it offers make Ethical Decision Making in Fund Raising a keenly important work for nonprofit CEOs, staff members, and students of ethics alike.

Part I describes the Ethical Decision-Making Model, which can guide fund raisers in examining questions nonprofits face from the perspectives of organizational mission, professional relationships, and personal integrity. Using real-life dilemmas with no clear-cut solutions, the model examines problems by considering the anticipated effects of alternative solutions on the organization, professional colleagues, and the fund raiser's own sense of integrity.

The multidimensional framework functions as an informal system of checks and balances in which no one interest dominates, no interests are overlooked, and the greater good of the entire organization is served. All of this is placed in the context of a gift economy, a concept that describes the dynamic "circle of giving" created through the donation of material gifts of money and goods and the intangible ones of time and talent.

Part II examines specific issues that arise in fund-raising practice, including relations among fund raisers, donors, and volunteers; privacy and confidentiality; conflicts of interest, including commission-based pay; cause-related marketing and sponsorships by corporations; and fostering cultural diversity. Each chapter concludes with discussion questions and additional case studies for analysis.

Fischer also examines the nature of philanthropy from antiquity to the present, filtered through such thinkers as Aristotle, for whom philanthropic giving was a form of moral excellence, and Jane Addams, who believed that sympathetic understanding is a key to ethical action. She shows how traditions of giving from many diverse cultures contribute to our appreciation of philanthropy as a dominant theme in the ongoing narrative of human history. Fischer details how, through giving, each of us can be part of the ageless continuum that preserves the greater good of the world we share.

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Product Details

  • ISBN-13: 9780471298434
  • Publisher: Wiley
  • Publication date: 2/22/2000
  • Series: AFP/Wiley Fund Development Series, #56
  • Edition number: 1
  • Pages: 272
  • Sales rank: 1,305,694
  • Product dimensions: 9.21 (w) x 6.14 (h) x 0.69 (d)

Meet the Author

MARILYN FISCHER, PhD, is Associate Professor of Philosophy at the University of Dayton. Her areas of specialization include ethics, political philosophy, feminist theory, and philosophy of music. She is particularly interested in interdisciplinary education and team-teaches several courses with faculty from different academic disciplines. Her current research focuses on Jane Addams's philosophical writings.

Dr. Fischer has been working with the NSFRE as an ethics consultant since 1990, giving workshops on ethical decision making in fund raising. She is a member of the Miami Valley NSFRE Chapter and chairs their Ethics Education Committee.

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Table of Contents


Thinking About Ethics and Philanthropy.

Organizational Mission and the Wider Frame of Philanthropy.

Professional Relationships.

Images and Virtues of Integrity.


Relations with Philanthropic Givers: Donors and Volunteers.

Privacy and Confidentiality.

Conflicts of Interest and Other Tensions on the Job.

Corporations and Philanthropy.

Fostering Diversity.




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First Chapter


Thinking About Ethics and Philanthropy

This book is not a scholarly treatise on ethics. There are thousands of years' worth of intellectual inquiries on ethics from every part of the globe, given to us by people far wiser than I. Nor is this a how-to manual. Sometimes, when I am trying to learn a new computer skill, for example, I want boorishly explicit step-by-step instructions, but I do not believe such an approach to ethics is either possible or desirable. Instead, in this book I will suggest ways of thinking about giving and philanthropy that will help you to think through the ethical dimensions of fund raising more fully and carefully. I will offer considerations for you to take into account, but you must do the actual taking into account, using your own good judgment. The book is not to give answers, but to stimulate your thinking as you develop your own stock of imaginative resources.

This book is written for fund raisers working for philanthropic organizations and for others who appreciate philanthropy as a way of creating and enriching community life. Most people who fit this description are decent, honest, and compassionate people, who already have considerable skill in making ethical decisions and acting in ethically sensitive ways. They already strive to be trustworthy, to act with integrity, and to treat others with decency and respect. This book is intended to enable them to build on their considerable skills and to think and feel more deeply and imaginatively than they already do.

In this book I will not discuss the big, headline-grabbing scandals very much. I am skeptical whether books on ethical decision making can have much effect on people who so deeply violate the public trust. Such people will continue to come into positions of power from time to time and they will continue to violate the public trust. Preventing scoundrels from engaging in scandalous behavior does not strike me as a goal to aim at directly. This book is aimed at the vast majority of fund raisers who do want to act with integrity and would never violate the public trust on a massive scale.

I hope this book will help these fund raisers think their way carefully through ethical quandaries and shape their organizations in ethically responsive ways. We want to weave organizational fabrics so that people of ordinary decency and courage can do well. Although we are grateful to people of great moral courage who take heroic stands against massive injustice, we also would like to shape a society in which such moral heroism is not often necessary. When organizations are structured so that integrity and trust are encouraged, rewarded, and built into policies and practices, then the fabric is strong and our philanthropic institutions are scandal-resistant. Fewer people will be able to get away with the minor indecencies that are often prerequisites for major scandals. Then, if and when the scandals come, public trust in philanthropic institutions can still be preserved.

This book does not provide a utopian vision. There is wonderful utopian literature and there are stirring biographies of people who persevered through unspeakable hardship to enact their visions of justice and compassion. We need to read those books and absorb their inspiration. While we hope that philanthropy attracts visionaries, we must still find the dollars for hot meals for the elderly, for training materials for volunteer literacy tutors, and for paying the independent auditor. Fund raisers, given their flaws and fineness, working in flawed and fine institutions with flawed and fine clients, still need to carry out these everyday tasks of decency and joy here and now. There is a place for utopias and for utopian ethical theory, but we should also attend to the ethical dimensions of everyday decision making.

So in a way this is not a visionary book. It is not intended to take you to the mountaintop, give you an ecstatic vision, and then pump you up emotionally, with the hope that the high will last long enough to bring in that next grant. Instead, this book is about thinking with care and grace about everyday grit. Utopias are not brought to earth through sheer vision, but moral progress is made as relationships are carefully constructed, as planning is done with sensitivity, and as our imaginations and emotions are stretched to include the ways of those different from ourselves. My aim in this book is to help people of ordinary decency and ordinary courage to accomplish their purposes, to help them build organizations in which sainthood is not a requirement for success, but where having ordinary decency and courage is enough.

This first chapter introduces the two conceptual frameworks that give coherence to the rest of the book, and then presents an ethical decision-making model based on those frameworks. The first framework, ethics as narrative, gives a way of understanding how thinking about ethics is done. The way we tell stories gives a good pattern for the way good ethical thinking proceeds. The second gives a framework for conceptualizing philanthropy by developing the idea of a gift economy. The goal of philanthropy is to sustain and enrich a gift economy. This idea of the gift economy provides the larger setting in which fund raisers' daily activities and decisions make sense.


How do we think about ethics? Ethical dilemmas arise within ongoing organizational and personal histories. A well-established agency, with policies and practices based on well-entrenched traditions, gets irritated with its new, "change-it-now" chief executive officer. Disagreement about values are at the root of decision impasses and personality clashes. As these dilemmas are resolved, the solutions and processes of arriving at them will become part of that organization's history, part of those particular individuals' patterns of working with each other. We can write stories about how ethical dilemmas arise; thinking about how to resolve them can take the form of imaginatively projecting alternate resolutions and the alternative futures they would bring.

Jane Addams's writings provide a good illustration of the way in which narrative functions as a method of thinking about ethics. Addams (1860-1935) is most well known as a founder of Chicago's Hull House and as an international peace activist. She worked with countless philanthropic organizations and did a lot of fund raising. She was also a penetratingly insightful philosopher, and her writings give us a paradigm for how to use narrative in ethical reflection. For example, in Democracy and Social Ethics, Addams works out her own ethical theory through telling about the people she interacted with in Chicago. She describes the lives of domestic servants, factory workers, charity visitors, and families she has known, trying to understand them from their own points of view, and placing their concerns in the ongoing contexts of their lives. By approaching Addams's stories as a method for thinking about ethics, we can identify two significant dimensions of ethical reflection: sympathetic understanding and social and temporal context.

(a) Sympathetic Understanding

Addams writes, "Sympathetic knowledge is the only way of approach to any human problem .. . not only by the information of the statistician, but by sympathetic understanding." Living in an immigrant community, interacting with her neighbors as neighbors, and not as subjects of charity, Addams sought to understand their customs, values, determination, and failings. She listened as they articulated their own needs and desires, and then worked with them to achieve the social changes they deemed important. Addams believed that only by approaching her neighbors through sympathy, and being willing to see their world through their own eyes as much as possible, would she be able to attain the sort of understanding needed for genuine social reform.

In Addams' method, sympathy gives access to knowledge, and emotion gives the impetus for action. She tells the story of an unloved orphan, who at age 9 became a dock worker. He lived roughly, until he encountered a disabled boy, abandoned on a freighter. From that first meeting until the boy's death several years later, he was the object of the dock worker's affection. Because of their friendship, the dock worker was transformed and became a labor leader committed to social change. Addams states that only the actual experience of sympathy and affection for a particular child in need, and not abstract moral theories, could have brought about this transformation.

Still, Addams knew that making changes based on sympathy alone was insufficient. She had seen how the charitable impulse could become "cruel and disastrous" if unfiltered by reason. While insisting that the perspective of the objective, detached outsider was inadequate by itself, Addams and her colleagues at Hull House carefully gathered statistical information and evaluated alternative courses of action before initiating reform measures.

(b) Social and Temporal Context

Along with sympathetic understanding, Addams stresses the importance of context: People's needs and desires must be understood within the social and temporal settings of their lives. She was highly critical of abstract ethical theories that attempted to prescribe actions merely by applying abstract ethical rules. Writing of a "charity visitor" who held strong ethical convictions about how people should live, Addams writes, "Her moral concepts constantly tend to float away from her, unless they have a basis in the concrete relation of life." Here, narrative as a method for thinking about ethics is helpful. The setting of a well-told story gives the concrete social and historical context essential for understanding the ethical dimensions of the situation.

Part of context is a sense of temporal movement. In a well-told story, we come to know characters as persons with unfolding lives, who can grow and change. They enter the story with a past, and even as the story ends, we know that their lives will continue. Much of the poignancy of Addams's stories of prostitutes in A New Conscience and An Ancient Evil emerges as she inquires into the stories of women who appeared to be hardened and morally calloused. The book is her analysis of what was then called the "white slave trade," in which girls and young women were lured or sometimes literally kidnapped from Europe and brought to the United States. Through probing into the women's pasts, she reveals the vulnerability, the tragedies, the sheer understandable humanness of their beginnings in the trade. Part of understanding others' view of a given situation is to place that situation within the ongoing drama of their lives.

Telling a good story (either real or fictional) with sympathetic understanding and plenty of contextual clues takes imagination. Addams saw imagination as a principal ingredient in good moral thinking, noting that "much of the insensibility and hardness of the world is due to the lack of imagination which prevents a realization of the experiences of other people." Moving in 1889 into an immigrant neighborhood with 18 nationalities represented, Addams saw clearly that ancient village traditions and customs could not bear the ethical weight they had traditionally carried. Imagination was needed to replace memory as the faculty for ethical decision making. Philosopher John Dewey, a friend and colleague of Addams and a trustee of Hull House, writes, "Imagination is the chief instrument of the good." He goes on to quote poet Percy Shelley, "A man to be greatly good must imagine intensely and comprehensively." Making good ethical decisions involves many imaginings: imagining a range of future alternatives; imagining what each alternative means for the individuals, the organizations, and the communities involved; imagining the organization and the individuals not as static, but as changing and growing; and imagining the current dilemma as one phase of that growth.

At times, imagination works spontaneously, with flashes of insight; at other times, our minds need to ruminate on the possibilities until clarity emerges. We tell and retell our stories to ourselves and to others; in the process, salient features emerge, and less important details fade.

(c) Fund Raisers as Ethical Decision Makers

The ethical decision-making model presented in this book uses patterns of storytelling as a method for ethical reflection. Thinking as novelists or playwrights, we can imagine different potential outcomes and ask what each outcome would mean for the organization, the community, and the individuals affected.

A drama has a setting, a context in which some courses of action are possible while others are not. For the philanthropic fund raiser, the context centers on nonprofit organizations, existing at a given point in time, in a given community. And there are the actors: the donors, board members, fund raisers, staff, clients, volunteers, and community members. Just as playwrights imagine their way into the minds of their characters, so in ethical reflection we think our way into the minds, values, and ways of life of those affected.

The goals for resolving ethical dilemmas also fit well into the patterns of storytelling, perhaps the sort of storytelling of continuing television dramas, in which the tale never ends and a sequel is always a possibility. After resolving an ethical dilemma, we must often come back and work with the same organization and the same people. Every individual resolution becomes part of the context for the next drama, shaping the potential for further cooperation or conflict.

Fund raisers enter the drama of ethical reflection with many ethical skills already in place. Dewey writes, "Thinking is secreted in the interstices of habits." 10 This is a powerful statement, and a good expression of what most fund raisers bring to ethical reflection. Aristotle writes of virtues as habits, as skills that people acquire through cultivation and practice. In practicing courageous acts, one becomes a courageous person. Through practicing acts of generosity, the virtue itself becomes built into one's personality. Most fund raisers are compassionate, fair-minded people. These character traits are "habit-skills," already built into their personalities from a lifetime of experience. But sometimes ethical dilemmas are too complex for these moral habits to deal with spontaneously. And so the sort of ethical reflection discussed in this book functions in "the interstices of habits," building on those moral skills and character traits fund raisers already possess, and thus enhancing these skills for future use.

(d) Ethical Rules

"But wait a minute," some may say, "ethics is about following rules - the 10 commandments of the Pentateuch, the five pillars of Islam, the four noble truths of the Buddha, the one golden rule."

Ethical rules are important; they will be referred to often throughout the book. Rules about telling the truth, respecting human dignity, and working for justice should always remain uppermost in our minds. But to conceptualize ethical thinking as just a matter of applying rules to specific occasions - " sort of like a math problem with humans," as one 11-year-old put it - is too narrow. Rules applied to life situations are applied within ongoing dramas, by actors with ongoing lives. When we try to apply rules mechanically, we may overlook the need for sympathetic understanding and forget that a proper application of rules must be responsive to specific features of context and peculiarities of character.

That ethical rules and storytelling are closely associated becomes more clear when we consider where ethical rules come from and how they are transmitted throughout time. Many rules come from religious and cultural traditions, the wisdom of ages distilled into short form. Those traditions often use stories to teach the rules and clarify their application. Consider the Bhagavad-Gita, the parables of Jesus, and the Analects of Confucius. Narrative judgment is inescapable. We need to decide which rules to apply in a given situation, and whether this is a case in which we should follow the rules directly, or make an exception. Aristotle describes the difficulty well, reminding us that exercising virtues entails feeling and acting "at the right times, about the right things, towards the right people, for the right end, and in the right way." In thinking of ethics as storytelling, I do not want to diminish the role and significance of ethical rules, but to place them within their proper narrative setting.


Like Russian dolls stacked inside each other, small stories are embedded within larger ones. Epics are fabricated out of countless individual episodes. Every nonprofit organization has its own specific mission, such as providing audiotapes for the blind, preserving rare manuscripts, or encouraging poetry readings. But these specific goals are embedded within the larger framework of the whole of philanthropy. The National Society of Fund Raising Executives (NSFRE) Statements of Ethical Principles is explicit about this. The first bullet in their list reads: "NSFRE members serve the ideal of philanthropy, are committed to the preservation and enhancement of volunteerism, and hold stewardship of these concepts as the over-riding principle of professional life...."

By surveying some common definitions of philanthropy, we can sense this wider frame. The relation between micro and macro levels is clear in historian Robert Bremner's comment, "Whatever motives animate individual philanthropists, the purpose of philanthropy itself is to promote the welfare, happiness, and culture of mankind." Robert Payton, founder of the Center on Philanthropy, defines philanthropy quite simply as "voluntary action for the public good," and applies anthropologist Clifford Geertz's felicitous phrase, "the social history of the moral imagination" to the history of philanthropy.

History does not have a grand storymaster controlling the script, and like all historical practices, philanthropy is perhaps better described by listing what it has done, rather than trying to give a unified definition. Brian O'Connell's list reflects this history: "To discover new frontiers of knowledge; to support and encourage excellence; to enable people to exercise their potential; to relieve human misery; to preserve and enhance democratic government and institutions; to make communities a better place to live; to nourish the spirit; to create tolerance, understanding, and peace among people; to remember the dead."

Above all, philanthropy is about creating and sustaining communities - communities of place, of choice, of purpose, of commitment, of interest. In Ethics and Obedience to the Unenforceable, John Gardner underscores the importance of community building, "We know from a lot of evidence that community not only confers identity, but a sense of belonging and allegiance, and a sense of security. But, more important, we know that communities are the ground-level generators of values." Giving a gift to the jazz series, volunteering one's time in the historical museum's gift shop, and serving on the drug rehabilitation center board are all part of a long tradition of using philanthropy to build and sustain human communities.

(a) The Metaphor of the Gift Economy

Metaphors help us think. A metaphor enables us to wrap our minds around something huge and multifaceted and make our way through it. Using narrative or storytelling as a pattern for ethical reflection gives us a method of proceeding, a pattern for knowing if we have done it well. Philanthropy, too, is huge and multifaceted, and sometimes while thinking about it or acting in it we lose a sense of what it is and what it is for. Using the notion of the gift economy as a metaphor for philanthropy will help us keep track of the purpose of philanthropy and how it functions.

French anthropologist Marcel Mauss's book, The Gift: The Form and Reason for Exchange in Archaic Societies, published in 1925, gives us a starting point for understanding the idea of a gift economy. In it, he describes extensive and complex systems of gift exchange in Polynesia, Melanesia, and in some Native American tribes in the American Northwest. In the Trobriand Islands, a system of gift exchange (kula) existed alongside market exchanges (gimwali). Vigorous bargaining, acceptable and characteristic of gimwali, was thought to be ignoble and inappropriate for kula. The practices of kula, which Mauss translates as "circle," comprised vast circles of ritual giving encompassing many tribes and many islands. A chief from one island arrives on a second island and offers gifts to its chief, often bracelets and necklaces of sacred significance. The gifts are worn and enjoyed, but after some time they are given away to those on a third island, and then on to the next. The kula is just one part of a vast system of services and objects given and passed on. Mauss describes it this way: "The process is marked by a continuous flow in all directions of presents given, accepted, and reciprocated, obligatorily and out of self-interest, by reason of greatness and for services rendered, through challenges and pledges."

This one example contains features common to gift economies, although many variations exist among different cultures. The most important feature is that the exchange is not quid pro quo, and while reciprocity is expected, the return is not given directly to the original giver. "Serial reciprocity" describes this process well. The gift, or another item in its place, is to be passed on to a third person, and then on to another so that the gift circulates widely. To accept a gift is to accept the obligation to pass it on, to reciprocate in some way, to become a giver oneself.

The gift has vitality, a spiritual or magical significance. The Maori speak of the hau, the spirit of the gift, which is an active spiritual power imbuing both giver and gift. In passing the gift to another, one shares a part of oneself. By circulating, the spirit of the gift is nourished and kept alive. As it moves, it fabricates and strengthens bonds of commitment and promise. The New Caledonians offer this moving description: "Our festivals are the movement of the hook that serves to bind together the various sections of the straw roofing so as to make one single roof, one single word."

Unlike commodity exchanges, gift exchanges are always off-balance, never complete. The bonds created give communities historical continuity. Obligations to reciprocate from the past are carried into the present; discharging them creates future promises to continue the spiral of giving. Gift economies create the interdependencies and ties of commitment and feeling (some affectionate, others just plain sticky) that define community. Individual motives for giving may be mixed and widely varied. (Mauss describes the pot-latch of Northwest American tribes as highly competitive and antagonistic. Honor and status belong to those who give the most away.) Whatever the donor's motives, the giving patterns themselves are not selfish because they are not directed solely or primarily toward the giver's benefit. Neither are they selfless, because givers participate in the communities they have created.

(b) Forms of Gift Economies

Gift economies take many forms. Friendship is one form. Mauss opens his book by quoting a section of a Scandinavian epic:

One must be a friend
To one's friend,
And give present for present;
One must have
Laughter for laughter
And sorrow for lies.
You know, if you have a friend
In whom you have confidence
And if you wish to get good results
Your soul must blend in with his
And you must exchange presents
And frequently pay him visits.

Friendships grow with reciprocity, through gifts of time and concern, where no specific return is demanded, but one will inevitably be given. I invite you to dinner; later, at a time of your choosing, you offer me a cup of tea, or perhaps you share theater tickets. I take your child for an afternoon; you show my nephew your photo lab. He sends your partner prints of his hike through the canyon. And so the gifts move on, and with them, the promise that our feeling bonds will continue to be nourished. Epicurus, an ancient Greek philosopher, said, "Of the things which wisdom provides for the blessedness of one's whole life, by far the greatest is the possession of friendship." This possession of friendship cannot be bought and sold in the marketplace; friendship can exist only as a gift economy.

Families are in many respects gift economies. Parents give children physical and emotional nourishment, lessons in life's joys and bumps. Children respond with spontaneous enthusiasm, giving to their parents unexpected and sometimes unrecognizable clay pots or finger paintings. But the children will grow and will pass their own acquired gifts of wisdom and care on to the next generation. In their interviews with Guatemalans living in the United States, the authors of Philanthropy in Communities of Color found that most of the Guatemalans they spoke with focused their giving within the family, but "family" was extensive and expansive; giving was frequent and highly responsive. Biological ties among grandparents, parents, children, aunts, uncles, and cousins are stretched by the tradition of compadrazgo, or ritual kinship. They share housing, food, and direct care-giving, and send money and goods to family members in Guatemala. No explicit promise of a return is needed, as family solidarity rests on traditions of reciprocal help and commitment. Many functions provided by nonprofits in the dominant American culture, such as nursing homes, hospice care, housing, and assistance to immigrants, are performed within the gift economy of the Guatemalan family. (Many of those interviewed had negative impressions of the dominant culture's philanthropic organizations and giving patterns, finding them a poor substitute for family care and responsibility.)

Gift economies can reflect deeply based philosophical, religious, and cosmological belief systems. Rebecca Adamson, a member of the Cherokee tribe and president of First Nations Development Institute, thinks that giving is a far more comprehensive concept than generosity, charity, or benevolence. For Native Americans, all of creation is connected in the web of life; all are related, and so all are responsible for nourishing the relationships which themselves sustain life. Giving traditions are a way of enacting their fundamental world view.

(c) Philanthropic Nonprofits as a Gift Economy

We must be careful not to think of gift economy as a synonym for philanthropic nonprofits, or of market economy as referring solely to for-profit businesses. Rather, strands of both gift and market exchanges run through both nonprofit and for-profit organizations. The products and services of many for-profit businesses respond to community needs and strengthen community vitality and growth. Many businesspeople give generously of their intelligence, creativity, and commitment to achieve these goals. Likewise, philanthropic non-profits participate in market exchanges. Relations with suppliers and charging fees for service where the fee is not subsidized by philanthropic contributions are examples of market rather than gift exchanges. As discussed in Chapter 8, cause-related marketing and sponsorships are better understood as aspects of the market economy in which nonprofits participate, rather than as examples of philanthropic giving.

We also need to be careful not to think of nonprofits as more ethical than businesses because they seek gifts, while thinking of for-profit businesses as less moral, or even amoral, because they seek profits. The two types of organizations have different missions and different ways of generating and distributing income, but many ethical responsibilities are common to both. To treat workers with dignity, customers and clients with honesty, and the community as a treasure are ethical responsibilities belonging to all of us, which carry over into all organizational settings. In both for-profit and nonprofit organizations, people find meaning, pursue goals, and create relationships that can nourish or bruise them. Being for-profit does not exempt an organization from high ethical standards; being nonprofit does not automatically endow an organization with ethical goodness.

Nonetheless, it is fitting to describe philanthropic nonprofits as fundamentally gift economies, even as market economy threads run through them. Central features that define a nonprofit organization's structure and functions are representative of gift rather than market economies. The mission statement is a good place to start. Philanthropic nonprofits exist to advance a public purpose, to enhance the common good; private financial benefit is expressly excluded. Of course, this statement raises many ethical questions. Does an organization fact serve the public good, or does it have a divisive, harmful effect on community well-being? Is its mission any more than a statement of lofty rhetoric, covering scurrilous activity? Admittedly, things can go wrong, well-intentioned people can misjudge their organization's impact, but the basic point still stands that the intended purpose of philanthropic nonprofits is to enhance public well-being, a gift-like quality.

Nonprofit reliance on volunteers is a clear indication of a gift economy. Many nonprofits begin as volunteer efforts; even in heavily staffed organizations, volunteers as board members hold ultimate responsibility. Volunteers give of themselves, their talents, and their time to the public good, without monetary compensation. They sustain the circle of giving, enabling nonprofits to accomplish the purposes of philanthropy.

Gift economies are precious, even though, like all human institutions they sometimes crack, reinforce privilege and subordination, or exclude some people from the circle altogether. Yet, sustaining the gift-like quality of community building is a bottom-line responsibility of philanthropy. I worry when I see donor appeals of the sort, "Give to us, and we will give you a neon bumper sticker, three status points with your employer, and five fewer days in purgatory." Donor recognition is fine, but here the nonprofit is losing sight of the nature of the gift and turning it into a parody of a market transaction.

It will help if we identify just what is being exchanged in a gift economy, and between whom. The exchange is not a direct one from donor to nonprofit and then right back from nonprofit to donor. Now donors and volunteers may receive certain benefits in the process. They get enjoyment from participating in communal activities, performing religious duties, or receiving social status and prestige. Benefits may come, but they are not what is being exchanged. The exchanges is not "I will give you $100, and you give me back $100 worth of satisfactory feelings," or "I will give you four hours a week with youngsters in the hospital playroom, and you give me four hours' worth of status with my volunteer-minded friends." Remember the circle created through the kula, linking all those Trobriand Islanders. Gifts traveled wide and were transmuted in spirit before ever returning to the original donors, assuming they were still alive and had not lost interest.

Let us follow the donor's $100 gift to the nonprofit hospital. The hospital is a funnel, swirling the gift along with many others. Services are provided to those who need them now. The giver may at some point benefit directly from the hospital, or perhaps never. The giver may be giving this $100 in reciprocity for benefits received as a 4-H Club member years ago, in a different community. We are all beneficiaries of convoluted loops of gifts and benefits. Trying to identify which gift corresponds to which benefit in the exchange hopelessly oversimplifies the process. We may be able to identify some givings and receivings in the gift economy of a two-person friendship, but if one thinks it is time to check the accounts, that is probably a sign that something is rotten in the friendship. Reciprocity may be tilting toward exploitation. In a gift economy in which the spirit of the gift has vitality, the givings and the receivings may be widely separated in time and place, but the spirit of the gift will pervade and unify both.

At this point, some illustrations may help. One way the circle of giving expands through time is through serial reciprocity. When one cannot return a gift to the original benefactor, then one gives to another in need. Alumni giving is one familiar example. Alumni's college costs were paid in part by former students, anonymous to them. They discharge the debt by giving to the next generation of students.

People frequently use the phrase giving back to explain how gifts circulate through their community. One African American explained his sense of community responsibility this way, "I would say you need to give back to the community in which you live in order to enjoy how the community thrives. It's the same principle that a farmer has to give back a little bit of what he reaps to the soil in order for it to harvest again. You can't just take and take and take - it becomes bereft of minerals and everything else and it won't produce anymore. You have to give back in all situations, in all situations."

While fund raisers in philanthropic nonprofits spend time in both market and gift economies, their primary purpose is to keep the spirit of the gift alive, to sustain and enhance the cycle of giving. philanthropy fuels a gift economy, and fund raisers can do much to keep the spirit of giving explicitly present to public perception. Fund raisers act as both facilitators and educators. As facilitators, they can offer donors and volunteers opportunities to act on shared value commitments and work toward shared visions of community well-being; they then facilitate the movement of the gifts toward those ends. As educators fund raisers provide information about community needs and possibilities for meeting those needs. Fund raisers also educate as the cycles of giving spiral through time. The young need to learn about philanthropy, and many of the not-so-young need some educational gaps filled in. Socrates thought of education as a form of midwifery, assisting people in giving birth to their own ideas, their own wisdom. Similarly, fund raisers often have the good fortune to help people assess and perhaps discover what they care about. They help people think about what shape they want their community to have and work out at least a part of how they want to lead their lives. By helping people make thoughtful, morally sensitive decisions about themselves and their community, fund raisers move the spirit of the gift and help to keep it vital. In Chapter 2 some of the specific virtues - generosity, charity, compassion, gratitude, and mutuality - that help the gift economy to function well will be discussed.

(d) Moral Complications in Gift Economies

Philanthropy belongs to that collection of terms, along with family, community, and gifts, which we all endorse enthusiastically until we get past the nostalgia and encounter their disquieting aspects. Robert Frost captured the weariness of family life in his poem, "The Death of the Hired Man," in which he defines home as "the place where, when you have to go there, they have to take you in." Socrates never did work out a mutually harmonious accommodation with his community The citizens condemned him to death; his friends arranged a way of escape. But Socrates refused exile, reminding his friends that his very identity was a gift from Athens. He was thoroughly enmeshed in that community, but it was a relationship better characterized by mutual irritation than by mutual love. Sometimes, community can best be defined as "made up of the people you squabble with."

Gifts come with strings attached. Communities are formed by strings; we want them, but sometimes we resent them. Ralph Waldo Emerson was keenly aware of the rub between independence and interdependence. In his essay on gifts, he says, "The law of benefits is a difficult channel, which requires careful sailing, or rude boats. It is not the office of a man to receive gifts. How dare you give them? We wish to be self-sustained. We do not quite forgive a giver. The hand that feeds us is in some danger of being bitten."

The strings attached to some gifts bind too tightly - the gift functions as an extension of the donor's power. Emerson continues, "The gift, to be true, must be the flowing of the giver unto me, co correspondent to my flowing unto him. When the waters are at level, then my goods pass to him, and his to me." When the strings attached to the gift work to keep the waters from reaching level, to keep the waters from flowing both ways, then the gift harms community, and so must be refused.

Think about a private school in the central city that prides itself on the diversity of its student body. Many board members think it has a healthy mix of students from different racial, ethnic, and economic backgrounds. However, one influential, white board member worries that the school is becoming, as he says, "too gray." He threatens to resign from the board, taking with him his generous donations his substantial influence in the city's financial sector, and his four, full tuition-paying children. The strings attached to his gifts of money, service, and influence threaten to distort the sort of community the school is committed to achieving.

At least once each semester, I remind my students of the truism, "You can never do only one thing." Gifts often do several things; we may applaud the obvious good they do while being oblivious to damages incurred. There are many stories of sacrificial generosity, which had the side effect of prolonging suffering. On April 12, 1861, the first shot of the U. S. Civil War was fired on Fort Sumter. On April 20, in Cleveland, the Ladies Aid and Sanitary Society was organized. Their mission was to provide blankets for all the volunteer soldiers. In carrying out this task, they discovered that many of the soldiers needed clothing. While they sewed, illness swept through the army camp, so the Society sent nurses and medical supplies. The same story could be told of cities and towns throughout both North and South. This letter, written in Virginia on August 18, 1861, could have come from any of them. "We are now very busy making clothes, knitting socks for the soldiers. Each lady proposes making one hundred garments - some are making mattresses, preparing bandages and knit nightshirts and comforts for the wounded - all are doing the most they can to add to the comforts of the soldiers." Had the efforts of the Ladies Aid Societies been less prodigious, the war might well have ended sooner. By acting to relieve immediate suffering, the women's efforts indirectly prolonged the suffering of many others.

These examples of moral complications illustrate why fund raisers and others involved in philanthropy need to place individual ethical decisions within larger frameworks. In the press of the current fund drive, it is too easy to appreciate the major gift without noticing how binding the attached strings may be or how the gift masks prejudice. In the early twentieth century, the Phillis Wheatley Home in Cleveland offered shelter, safety, friendship and job training to young black women. Many white women contributed financial support to the Wheatley Home, but historian Darlene Clark Hine sees a racist underside to their generosity. It gave them a way to keep the Young Women's Christian Association exclusively white and to get more highly trained maids for themselves. Nonprofit fund raisers, educators, and facilitators of the gifts that build community must sort through such strings and complications every day.

(e) The Color of Ethics

"It's such a gray area," we often hear, when difficult ethical situations come up. Gray is the color of fog, of cloudy dull skies without clarity or edges. In ethical reflection, we sometimes feel as if we are navigating in a fog with no landmarks and no sense of direction. Gray is also a color made by mixing black and white. Sometimes, in our ethical reflections, we see no clear, right answers; every alternative is tinged with negativity, evil taints the good.

"Ethics as gray" is a potent metaphor, and as with all things potent, it needs to be used with great care. Some ethical choices are clearly right or wrong and to call ethics "gray" in these cases is a way of hiding from ethical truths and ethical responsibilities. But in other cases, choices are not so clear and it is important to identify and acknowledge the ways in which ethics can be gray. In some cases, it may be true that no alternative course of action is ethically pure, and all alternatives require uncomfortable compromises. A second type of grayness arises when ethically decent people prioritize their values differently. Some members of a social service agency may want to emphasize relieving immediate needs for food and shelter; others may want to stress education and job training as long-term self-sufficiency skills. A third type of grayness arises from the way that the same acts can accomplish both ethical and unethical purposes as in the Civil War and the Phillis Wheatley Home examples.

When ethical situations look gray, it is important to sort out just which sense of grayness applies. If the real difficulty is that morally decent people prioritize their values differently, but those involved think the grayness results from good mixed with evil, organizations may become needlessly polarized. In the social service agency example those concerned with long-term self-sufficiency can accuse the others of trying to foster dependency; those committed to meeting immediate needs can accuse the others of lacking compassion.

When an ethical quandary feels gray, thinking of ethics as storytelling can be helpful. When the full story of the ethical dilemma is told carefully, with sympathetic understanding of each person's perspective this sort of polarization can be minimized. In the following section, a method of ethical decision making is presented that will help fund raisers construct stories in a way that clarifies the grayness and brings basic ethical commitments to the foreground. The method encourages sympathetic understanding and imagination as tools for resolving ethically troubling situations.


Most daily decisions have an ethical dimension, and much of the time we instinctively function as competent ethical decision makers. We may not be directly conscious of it, but much of our "common-sense" decision making incorporates concern for basic ethical values such as honesty, establishing trust with others, and showing concern for their well-being. Usually, we are kind to children, fair to our colleagues and decent to strangers.

A story will illustrate how we insert ethical concerns into our everyday lives. By examining this story, we can draw out the ethical dimensions of everyday thought, and then apply the same pattern to ethical decision making in fund raising.

After work, you pick up a four-year-old (your child, your grandchild, a neighbor, or some other youngster to whom you are attached) from day care and stop by the supermarket to find something to serve your second cousin twice removed, who just happens to be passing through town this evening. At the store you bump into a friend and stop to chat for a few minutes. You talk about the fact that if it does not rain soon your shrubs will die, about the sale on avocados in the produce department, and about getting a haircut before the fundraising gala next week. All the while, the 4-year-old is wandering about examining boxes of granola bars.

This may look like a rare moment of idyllic calm in your overstressed life, but what is really going on inside your head is some remarkably sophisticated ethical decision making in which you link moment-by-moment decisions to your most basic values. You let the 4-year-old wander (although always in sight) because you want him to grow up to be curious and independent. Your friend has been an important source of strength and support for years. She is the one who did your laundry for a month when your father was dying of cancer. You know her daughter has a drug problem, so as you chat through a guacamole recipe, you watch her face and listen to her tone of voice, judging if this is the day she needs for you to take an extra five minutes communing about produce sales. It has little to do with avocados, and everything to do with sustaining the friendship.

Suddenly, right when you are getting to the part about adding the lemon juice, you break off in mid-sentence and dash madly after the 4-year-old, as he gets perilously close to the pyramid of glass pickle jars. Keeping him alive and reasonably intact is also something you care about.

Here, your decisions about pickles, granola bars, and guacamole revolve around your basic values of caring for the child and sustaining your most important relationships. Much of getting through the day is a matter of negotiating life's little details in ways that support these basic values. Most of the time, at least in familiar surroundings we successfully integrate basic values with life's minutia, without even being conscious of it. When troubling or unusually complex issues arise, however, or when we have too many responsibilities to juggle at once, it is helpful to articulate these values and deliberate about what courses of action are most consistent with our basic value commitments.

(a) Fund Raisers' Three Basic Value Commitments

In this story, caring for the child and sustaining the friendship are basic value commitments. For fund raisers in their professional capacity, three basic value commitments can be identified:

1. The organizational mission that directs the work
2. Our relationships with the people with whom we interact
3. Our own sense of personal integrity

The fund raiser, acting with integrity, has the task of creating and maintaining a supporting network of relationships in order to further the mission of the organization. We bring ethical sensitivity to decision making when we place particular decisions in the context of these three basic value commitments. The ethical decision-making model takes these three value commitments and uses them to construct stories about alternative ways of resolving ethically troubling situations. Here, each of the three value commitments will be described briefly, and then a sample case analysis using the model will be given. Then, I will point out how using this method incorporates the dimensions of ethics discussed in this chapter: sympathetic understanding, social and temporal context, and sustaining the gift economy's vitality. In the chapters that follow, each of the three basic value commitments will be discussed in considerable detail.

(i) Organizational Mission
Every philanthropic organization has a mission - social need it is trying to meet, a human good it is trying to achieve. Such purposes range from providing disaster relief to preserving rain forests; from meeting basic survival needs to enriching our spirits through artistic excellence or religious devotion. The mission justifies and directs daily tasks and decisions.

Ethical difficulties often involve misalignments between the organizational mission and daily decisions. Decisions about a university athletic program may bring glory to the school, while the athletes remain poorly educated. Professors may favor outside consulting to the point of neglecting their students. In some organizations when glamorous fundraising events net little income, one has to ask if their primary function is to serve the organizational mission or to provide high-class entertainment for the organization's supporters.

Many organizations have more than one fundamental purpose. A hospital, for example, may define its mission in terms of patient care, medical research, and educating future medical practitioners. While a given daily decision may not further all three goals, we can at least take care that a decision furthering one purpose does not unduly slight or injure another. Soliciting funds for long-term basic research is fine, as long as that emphasis does not diminish the quality of patient care.

Each nonprofit's specific organizational mission is embedded inside the larger framework of philanthropy. Although it is good to review and revise the mission statement periodically to make sure it advances philanthropic values, it is also helpful to assess even small-scale decisions in light of their impact on philanthropy as a gift economy. Does a particular decision revitalize the spirit of giving and move the gift along its way?

(ii) Relationships
The slogan goes that fund raisers raise friends, as much as funds. Networks of relationships with donors, colleagues, volunteers, and community members are the medium through which organizational missions are furthered. The second basic value commitment, then, is concerned with the character and quality of our relationships to each of these groups. Many ethically troubling situations are caused by or may cause fractures in workplace relationships.

Think of the qualities that characterize healthy, long-term professional relationships. Respect, honesty, and open communication are high on the list. Sensitivity, caring, and a good sense of humor also figure prominently. And trust, no doubt, is a central value -rust in the goodwill and integrity of the other, and trust that one is respected and that one's basic concerns are taken seriously. When thinking through alternative ways of resolving ethical difficulties, try to enter imaginatively into other people's way of experiencing the world. How do others, with their own idiosyncratic concerns, priorities, and values view this alternative? How would it strengthen or weaken the relationship Not all relationships can or should be preserved; even in ethically sound decisions, some relationships may still get bruised. The point is to incorporate sympathetic understanding as much as possible, and maintain the possibility of a future healthy relationship.

(iii) Integrity
The third value commitment is to preserve and strengthen one's own sense of integrity, to express basic values in everyday actions with courage and compassion. "Ethics" comes from ethos, the ancient Greek word for character. Aristotle defined an ethical person as someone with a virtuous character, in whom virtues reside as deeply internalized personality characteristics. Virtues, like skills and habits, are acquired through practice. Just as a pianist acquires habits of skillful playing through daily practice, so we can practice being generous fair, brave, thoughtful, and honest. Through using daily decisions as opportunities for practice, we gradually nurture and develop the ethical qualities of our character.

Often, a sign of ethical trouble is that gnawing feeling that a given path of action would compromise one's integrity. You know that few of the clients in your drug rehabilitation clinic achieve the glowing success portrayed in your TV spots. Your stomach turns a bit when a donor tells you he was so moved by the spots that he wants to double his pledge. Is your fund-raising success based on dishonest portrayals? To maintain a long-term perspective it is helpful to think of integrity as a lifetime project, always in the making. In a sense, we are continually engaged in writing our own autobiographies. Each decision, each encounter adds a few lines. The question "How should I act now?" is layered inside the larger question, "How would I like this page of my autobiography to read when I look back at it many years from now? What sort of a person will this decision incline me to become?"

(b) Using the Ethical Decision-Making Chart

Ethical reflection is an activity, carried out through conversations. Because ethically troubling situations generally involve several people practicing ethics as a social activity enables the participants to hear the others' perceptions and ways of dealing with the difficulty. It also creates the space for collaborative decision making. Even when done alone, ethical reflection often takes the form of conversations with oneself, in which other voices are imagined and projected Using the ethical decision-making chart seen in Exhibit 1.2 can guide us in constructing stories and using our imaginations to think about the characters and the setting of workplace dramas.

Making a good ethical decision rests, in part, on whether the participants have asked enough good questions. Placing daily decisions in the context of these three basic value commitments is one way of ensuring that enough good questions are asked. After gathering all relevant information, you are ready to use the chart, "Ethical Decision Making: Evaluating the Alternatives." Begin by writing in a few alternative ways of resolving the case. It is alright to start with alternatives as obvious as "do it" and "don't do it." Include alternatives with which you are pretty sure you disagree. Analyzing obviously unethical alternatives often brings out insights that can be applied to less clear-cut solutions. Participants often find that additional and often more creative resolutions arise as they discuss the case.

Now work your way down the chart. For each alternative resolution ask yourself:

  • How does this alternative promote or detract from the organization's mission? How does it promote or detract from basic philanthropic values?
  • How does this alternative affect long-term relationships with colleagues donors, volunteers, and community members?
  • In what ways does this alternative help or not help me develop into the person I want to become? How does it strengthen or weaken my own integrity?

There is no equation or formula that, if applied correctly, will yield an "ethically correct" decision. This is not a flowchart; you do not insert facts, add values, push a button, and wait for a correct solution to emerge out the other end. Ethics always involves judgment, and people of goodwill often disagree on how to interpret the facts or assess the values of a given situation. For many situations, there may be no one right answer; the ethics may be "gray" in one of the senses discussed above. But there are plenty of wrong answers, and the hope is that after reflection, the wrongness of the wrong answers will be clear. One will then be able to choose among the others with sensitivity and good judgment. If an alternative supports all three basic value commitments you can be assured that it is ethically sound.

(c) Sample Case Analysis: The Wildlife Painting Case

Consider this scenario:

A college fund raiser has been working with an alumna, a famous wildlife painter. She agrees to do an oil painting of a nostalgic campus scene. Alumni who donate at least $100 to the college annual fund will receive reprints of the painting. After a highly successful fundraising program, the artist presents the fund raiser with one of her original oil paintings, valued at more than $2,500. Is it ethical to accept the painting as a personal gift? The obvious alternatives are: (1) accept the painting or (2) reject the painting. We can start by analyzing just these two. (See Exhibit 1.3.)

(i) Alternative 1: Accept the Painting

Organizational Mission. The college's fundamental purposes include educating students, contributing to the growth of scholarly knowledge through research, and serving the community. None of these are compromised in a direct or immediate way if you accept the painting However, because you accepted the painting as a personal gift, the artist may feel you have an obligation to her. In the future, she could put you in an awkward position, which could have detrimental effects on the organizational mission. For example, she could pressure you to use your influence to get her a position on the college board of trustees. Or, she may want to establish a scholarship for students interested in studying an esoteric art form, even though the art department lacks the necessary personnel and the resources to support this study.

Should the artist use her influence in these ways, students and the college community could be adversely affected. She may not be qualified to be on the board, she may compromise the autonomy and good judgment of the art department, and so on.

Encouraging values such as generosity and gratitude help to sustain philanthropy as a gift economy. If you accept the painting, you acknowledge the artist's generosity and gratitude. However, you also remove the painting from circulating within the gift economy.

Relationships. From the preceding discussion, it is clear that your relationship with the artist may be compromised. Instead of a professional relationship in which mutual concern for the well-being of the college is foremost, personal ties of obligation may have been formed. Your relationships with colleagues may also become strained. Your colleagues worked with you on the fundraising project yet they did not receive personal paintings. They might wonder if you have received personal gifts or favors from other donors as well. These suspicions would weaken the trust that underlies the long-term health of collegial relationships.

Personal Integrity. You have compromised your own integrity and your ability to act with independent judgment by placing yourself in such a position with the artist. She did not merely offer you a personal gift, as between friends. By mixing personal and professional roles, the artist brings with the gift the expectation of future professional favors. By asking her to do the painting for the alumni in the first place, you gave her a lot of publicity. Alumni may like the print and want to obtain more of her work. The artist could use the personal gift as a way of pressuring you to open additional future opportunities for her. Accepting the gift this time may make it more difficult for you to act independently in future dealings.

(ii) Alternative 2: Reject the Painting

Organizational Mission. If you reject the painting as a personal gift, you avoid putting yourself in this compromised position. You will not be in a position to detract from the college's fundamental purposes, and you further its purposes indirectly by remaining the sort of professional best able to work for the institution.

The college's mission is consistent with the purpose of philanthropy as serving the public good. Although the artist's own sense of generosity may be dented if you refuse the painting, you keep the college on firm ground to encourage philanthropic giving from others.

Relationships. If colleagues knew you had been offered and had rejected the painting, this would strengthen the trust and respect they have in you, and thus strengthen your working relationships. Your relationship with the artist may become strained, but she has placed you in a position in which a healthy relationship is impossible. The strain may be temporary; rejecting the painting may be the only way to make a future good relationship with her possible.

Personal Integrity. You have used this experience as practice for strengthening your own integrity, even though it may have been difficult/p>

By the time you work through these two alternatives, it is likely that someone will suggest, "How about asking the artist to donate the painting to the college? It would look great hanging in the college theater lobby." So, let us add this alternative to the chart.

(iii) Alternative 3: Ask the Artist to Donate the Painting to the College

Organizational Mission. One aspect of educating students and serving the community is to enhance people's aesthetic sensibility. Displaying the painting in the college theater serves this purpose and also acknowledges the artist's generosity and gratitude. The painting remains within the philanthropic gift economy so that visitors and members of the college community can enjoy it.

Relationships. Accepting the painting for the college rewards all your colleagues who worked on this project, rather than giving special recognition just to you. This would strengthen the spirit of camaraderie among you and your colleagues, which would have a positive effect on future endeavors. Other artists and potential donors may also feel encouraged to support the college in analogous ways.

The artist may not have had ulterior motives in offering you the painting. She may simply have appreciated the opportunity to work with you and help the college. She may not have realized that in offering the painting as a personal gift, she is placing you in a compromised position. By suggesting she donate the painting to the college, you offer her a way to show her appreciation, without the sense of embarrassment she may feel if you simply refuse the painting as a personal gift.

Personal Integrity. Part of your own sense of personal integrity is to be an effective, dilig ent professional. Encouraging the artist to donate the painting is well in keeping with your role as fund raiser. Rather than placing a block in the cycle of giving, you have facilitated its movement.

In this case study, the strongest alternative is to encourage the artist to donate the painting to the college. If she refuses, then you should refuse to accept the painting as a personal gift.

While working through this case, someone may ask, "Suppose it's a lousy painting?" That is a good question, and it gives you a new case to analyze. So, take out a fresh copy of the chart and begin anew.

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