By Pam Highsmith, CFRE
AFP Board Member
Vice President, Advancement & Donor Relations, North Carolina Medical Society
Like many of you who operate on a calendar year, along with working hard to secure year-end donations, my organization is in the midst of performance reviews and goal setting for 2023. It’s at this time of year that I am reminded of two Standards from the AFP Code of Ethical Principles and Ethical Standards related to compensation of fundraising professionals.
Standard 21 reads: Members shall not accept compensation or enter into a contract that is based on a percentage of contributions; nor shall members accept finder’s fees or contingent fees. I am still surprised at the number of well educated and savvy board members and chief executives who suggest that fundraisers be paid a percentage of what they raise. If you don’t understand why this is inappropriate, please stop here and read the AFP Code of Ethical Principles and Ethical Standards. A hint about why this is inappropriate – the AFP code is rooted in maintaining our donors’ trust and in honoring our organizations’ missions.
Also, like many of you, members of our development teams have gone above and beyond for our organization’s mission and have exceeded performance goals – can they be paid a bonus? The answer is – it depends. Standard 22 reads: Members shall be permitted to accept performance-based compensation, such as bonuses, only if such bonuses are in accord with prevailing practices within the members’ own organizations and are not based on a percentage of contributions.
As Jason Lee, former General Counsel and Ethics Committee Staffer, explains on AFP’s website, “the organization must have a policy and practice that awards bonuses/performance-based compensation approved by the organization’s governing body based upon by mutually agreed upon goals.” So, if your organization has established practices and policies in place, go ahead and give that outstanding fundraiser a bonus. I know she or he has earned it!
Wishing you joy and good health during the holiday season and in 2023!