The Association of Fundraising Professionals (AFP) has a Code of Ethics that specifically bans the practice of percentage-based fundraising. They consider the practice unethical and have developed a position paper outlining why it hurts the industry.
Last week, the AFP went even further by calling on Congress to ban the practice.
On Thursday, Dec. 13, the House Oversight and Government Reform Committee held a hearing that examined the fundraising and spending habits of charities that serve veterans.
“If you examine the charities that have extremely high fundraising costs, including several of the groups highlighted during the hearing, you’ll almost always find that these organizations pay their fundraising firms on a percentage basis,” says Paulette V. Maehara, CFRE, CAE, president and CEO. “The one single reform proposal that would make the most difference in stopping fraud and strengthening public trust in the charitable sector would be for Congress to ban percentage-based fundraising.”The AFP maintains that percentage based fundraising is unethical because:
* charitable mission becomes secondary to personal gain
* donor trust can be unalterably damaged
* there is incentive for self-dealing to prevail over donors' best interests
* the very philanthropic values on which the voluntary sector is based are undermined.
Even if you agree, do you think asking Congress to ban the practice is the right thing to do?