FUNDRAISING ETHICS SPECIAL CONSIDERATIONS WHEN YOUR DONORS ARE

FUNDRAISING ETHICS: SPECIAL CONSIDERATIONS WHEN YOUR DONORS ARE OLDER ADULTS Sunday March 29, 2020 9: 00 – 10: 15 AM Robbe Healey, MBA, NHA, ACFRE AFP Ethics Committee, Immediate Past Chair 1

What we’ll be covering… • The seven ethical dilemmas • Issues of aging and older adult donors • Ideas for building a culture of ethical fundraising in your organization • Discussion of sample cases 2

Baseline or Pinnacle • Dr. Paul Pribbenow, ethics expert, reminds us: • The Code of Ethics sometimes seems like this black -and-white document sent from on high • It’s a living document that represents just the floor for ethical behavior. • The key is for us to slow down and think through the sort of lives we want to live, our moral values, the ethical situation we face, and then to encourage discussion about our professional moral lives. ” 3

From the headlines 4

From the headlines 5

The Trend • The aging population in the U. S. is growing rapidly, with the number of people age 65 and over in 2010 (40. 2 million) projected to more than double by 2050. With the rapid increase in the aging population, the size of the population with cognitive impairment and dementia will continue to accelerate, highlighting the importance of identifying cognitive changes. For adults 65 years and older … the estimated prevalence of cognitive impairment in was… 18. 8 percent in 2012. New York University. (2018, January 16). 6

A sampling of facts Pennsylvania Washington https: //www. alz. org/alzheimers-dementia/facts-figures 7 Georgia

Cognitive impairment … is when a person has trouble remembering, learning new things, concentrating, or making decisions that affect their everyday life. . With mild impairment, people may begin to notice changes in cognitive functions, but still be able to do their everyday activities. 8

Key Facts About Cognitive Impairment* Cognitive impairment is not caused by any one disease or condition, nor is it limited to a specific age group. Alzheimer’s disease and other dementias, in addition to conditions such as stroke, traumatic brain injury, and developmental disabilities, can cause cognitive impairment. A few commons signs of cognitive impairment include the following: • • Memory loss. Frequently asking the same question or repeating the same story over and over. Not recognizing familiar people and places. Having trouble exercising judgment, such as knowing what to do in an emergency. Changes in mood or behavior. Vision problems. Difficulty planning and carrying out tasks, such as following a recipe or keeping track of monthly bills. * https: //www. cdc. gov/aging/pdf/cognitive_impairment/cogimp_poilicy_final. pdf 9

And then there is Ageism • Ageism is a type of discrimination that involves prejudice against people based on their age. Similar to racism and sexism, ageism involves holding negative stereotypes about people of different ages. • The term ageism was first used by gerontologist Robert N. Butler to describe the discrimination of older adults. Today, the term is often applied to any type of age-based discrimination, whether it involves prejudice against children, teenagers, adults, or senior citizens. 10

Just How Common Is Ageism? • Researchers have also found that ageism is surprisingly commonplace. • In one study published in a 2013 issue of The Gerontologist, researchers looked at how older people were represented in Facebook groups. They found 84 groups devoted to the topic of older adults, but most of these groups had been created by people in their 20 s. • Nearly 75 percent of the groups existed to criticize older people and nearly 40 percent advocated banning them from activities such as driving and shopping. • Ask yourself: • Do fundraisers bring ageism to the table? 11

Set a very high bar • We don’t decide if a donor is competent or impaired … the decision makers and influencers include: • Family • Even if they have no legal “standing” • Legal advisors • Care providers • Anyone with an opinion and the ability to communicate what they think we have “done” with or to a prospect or donor. 12

We Can Start with The Seven Ethical Dilemmas 1. Tainted Money – Conflict between the mission and the source of funds 2. Compensation – Persons who provide you with the names of prospects or donors should not receive any form of compensation – Compensation of fundraisers or consultants should never be based upon a percentage of funds raised 13

The Seven Ethical Dilemmas 3. Privacy – Fundraisers, consultants, board members and volunteers should not obtain or retain non-essential or highly personal information – Information obtained should remain within the organization, the custodians of confidential information, not the fundraiser 4. Appearance of Impropriety – We can be abiding by the law and adhering to regulations, but still not be acting ethically. 14

The Seven Ethical Dilemmas 5. Stewardship – Assure the public that philanthropic funds will be used in accordance with the wishes of the donor – Comply with the donors’ written stipulations as well as with their spirit and intent 6. Honesty and Transparency – Promote decision-making on the part of donors and prospects based upon complete and accurate information – Honesty with our donors is the basis for healthy relationships 15

The Seven Ethical Dilemmas 7. Conflicts of Interest – Transactions should: – be totally transparent – use open processes – be subject to the same rules and norms as other business transactions (E. g. , bidding) – be addressed openly 16

The key considerations start with • Privacy • Appearance of Impropriety • Honesty and transparency • Conflicts of Interest 17

Ethics: Observations • Ethics need to be considered in the most routine transactions • Simply because something is “legal” does not necessarily mean it’s ethical • Simply because something is “ethical” does not necessarily mean that it’s smart! • Sometimes none of the options are “incorrect” – use the most “correct” 18

Ethical fundraising and managing philanthropic funds – whose job is it anyway? Executive Staff / Management Program Personnel and other Staff The Fundraising Staff The Ethical Organization 19 The Board of Directors / Volunteers

Integrating Ethics into the Organizational Culture • Integrate transparency and ethics into the organization’s decision-making processes, policies and procedures • Familiarize new employees, volunteers and board members with the organization's professional standards and commitments • Incorporate adherence to your organization’s ethical standards as part of staff performance evaluations • Use your website, social media and other vehicles to share your organization’s ethical standards and 20

Defining the way we work: Policies • Gift Solicitation • Assessing appropriateness • List management and name removal • Stewardship • Solicitation • Gift Acceptance • Assessing appropriateness • Third party input and confirmation • Other? 21

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Public Trust, Transparency & Conflicts Of Interest 1. not engage in activities that harm the members’ organizations, clients or profession or knowingly bring the profession into disrepute. 2. not engage in activities that conflict with their fiduciary, ethical and legal obligations to their organizations, clients or profession. 3. effectively disclose all potential and actual conflicts of interest; such disclosure does not preclude or imply ethical impropriety. 23

Public Trust, Transparency & Conflicts Of Interest 4. not exploit any relationship with a donor, prospect, volunteer, client or employee for the benefit of the members or the members’ organizations. 5. comply with all applicable local, state, provincial and federal civil and criminal laws. 6. recognize their individual boundaries of professional competence. Treatment Of Confidential & Proprietary Information 17. not disclose privileged or confidential information to unauthorized parties. 24

2 5 What should you do? 25

Case A: Bright Star Your donors are a couple ages 91 and 89, Julian and Jessica They are longtime residents of your retirement community and very affluent, even more so now that Julian has sold his company for an estimated $28 million. He served as a board member 13 years including one term as Board Chair. Jessica served on the Auxiliary, with which you worked closely when you first joined the staff as PR Director. She often commented that she loved Bright Star but never liked dealing with money. They are long time donors. Bright Star named a family reflection and meditation garden in his honor following his service on the board. They have made several major gifts, the largest of which was $28, 000 in 2003. You have been talking with them about a $1 million gift to fund a family resource specialist position to work one-on-one with families needing additional support and advocacy not available through any other program. Gift would be managed as an endowment. You have had several positive conversations with them. Julian has confidence in the current board and understands that endowing the position would ensure that the center would benefit from consistent staffing. He has not completed the gift agreement, but has his advisors working on selecting assets and reviewing your gift proposal. Jessica is supportive but never engages in conversation about the gift structure. They have three children, Jill, Jack and Jenny, ages 69, 67 and 65. You arrive at your office following a two-week vacation to discover that Julian was admitted to the skilled nursing center. You call Jessica to express your concern and Jack answers the telephone. Jack shares the news that his father had a major stroke. The prognosis is that Julian will survive, but his speech is likely to be significantly impaired and that he is as yet unable to consistently recognize family members. 1. What do you do? 2. Suppose one of the children has Financial Power of Attorney for Julian, what options do you have? 26

Case B: Ethical? “Trust Revoked” In your old job with a highly regarded, financially stable organization, you developed a close working relationship with an elderly couple who set up a revocable trust with the organization. You then move to a new organization whose financial situation is somewhat shaky. Several months later the couple comes to you and says that because they have such confidence in your ability to look after their interests, they want to revoke the original trust and set up a new one through you with your new organization. 1. What should you do? 2. Suppose the couple proposed to make a major gift to your new organization without revoking the old trust. What should you do? 27 27

Case C: Memorial for my Wife You are working with Mr. Gold on a major gift to your capital campaign. It will be a gift from him in memory of his late wife, Rose. Recently you have left several voice mails and when you get a call back it is from his daughter, Honey, who lives out of town. Honey tells you Mr. Gold had a recent health incident requiring hospitalization but he is back at home and looking forward to seeing you. Honey adds … Mr. Gold is having good days and bad days – but most days are good. She adds I am leaving tonight to go back home. You ask her if there is anything she cares to share about the health incident or Mr. Gold’s current health status. Honey declines saying, he can tell you want he wants you to know. You call him, Mr. Gold seems his “normal self” and you set an appointment for the following week. The visit starts off very well, but you find him asking the same questions several times and doesn’t seem to remember Honey’s recent visit during and after his hospitalization. 1. What do you do? 28

It may be hard … but walking away is worth it in the long run. 29

Resources on Cognitive impairment • administration on aging: www. aoa. gov • alzheimer’s association: www. alz. org • Centers for Disease Control and prevention’s Healthy aging program: www. cdc. gov/aging • Council of State governments: www. csg. org • Family Caregiver alliance: www. caregiver. org • national alliance for Caregiving: www. caregiving. org • national association of area agencies on aging: www. n 4 a. org • national institute on aging: www. nia. nih. gov • Cognitive impairment: a call for action, Now! www. cdc. gov/aging/healthybrain/index. htm 30

Examples of Ethical Standards • Statement of Professional Standards and Conduct of the Association for Healthcare Philanthropy (http: //www. ahp. org/membership/profstandards. php) • Code of Stewardship and Ethics of the National Catholic Development Conference (http: //www. ncdc. org/accountability/code. asp) • Statement of Values and Code of Ethics for Nonprofit and Philanthropic Organizations (www. independentsector. org/pdfs/code_ethics. pdf) • Access more than 100 norms, codes and principles from associations and philanthropic organizations at: (www. independentsector. org/issues/accountability/standards 2. html) 31

Thank You Roberta A. Healey, MBA, NHA, ACFRE Member, AFP Ethics Committee Chair, AFP 2009 -10 Chair, AFP Ethics Committee 2018 -2019 Robbe. Healey@ auroraphilanthropic. com 610. 996. 4650 32