Why You Need Gift Acceptance Policies

Why is it important for a nonprofit to have fundraising policies?

Most nonprofit organizations have personnel policies, fiscal policies and board policies, but often these same organizations have never taken the time to develop fundraising policies. These policies are important for a number of reasons:

• To prevent the organizations from accepting gifts that may be inappropriate for the organization;
• To prevent the acceptance of gifts that have "strings" attached to them;
• To have consistent policies for staff so there is no need to reinvent the wheel every time an unusual situation arises;
• To provide a guideline for volunteers who are making solicitation calls;
• To provide guidelines on how to dispose of or invest non-cash gifts.

  

These are just a few of the dilemmas that some nonprofits have faced:

• An environmental agency was faced with a gift which the donor wanted to use to "purchase" multiple memberships, from a member of the local business community whose company was a well-known polluter of the environment. This agency had a policy that stated members supported the mission of the organization and therefore, turned down the gift.
• A domestic violence center was offered a major gift from the owner of a "gentlemen's club. The agency did not have gift acceptance policies in place, and sent numerous hours at a board meeting debating whether the agency should accept this gift or not.
• A religious organization was offered a gift of stock from a company which was deemed by this organization to be "socially unacceptable." The organization had a policy in place which stated that they could accept the gift but would sell the stock immediately rather than keep questionable stock holding in their portfolio.
• An organization located in Nevada was offered a gift from a brothel (a legal business in rural Nevada). This organization had a policy that stated it would accept a gift from this type of business since it was legal business.
• An organization was offered a gift of land, to the delight of its board of directors who were contemplating a capital campaign for a new facility and needed a building site. The board's excitement turned sour when they found it would cost $500,000 to remediate the soil on this site.
• An art museum was offered a "valuable piece of artwork" which turned out to be a painting of Elvis Presley on black velvet, which did not fit into this museum's collection. Fortunately the museum had a policy in place that all gifts to its collection needed to be approved by the Collection Management Committee and furthermore that such gifts were required to be accompanied by a gift of cash to appraise, restore if necessary, and maintain artwork.
• A religious organization turned down a major gift from the winner of lottery because its policy stated that gambling proceeds were not deemed to be acceptable donations.
• A university was offered a large gift with the stipulation that the donor would be appointed to the board of trustees. The university had a policy which clearly stated that this was determined to be unethical and that such a gift would not be accepted.

This brief sampling of some of the dilemmas that accompany gift acceptance point to the reason why having these polices is important. So what should these policies cover? Some things to consider when developing gift acceptance policies:

• How will gifts be solicited?
• From whom will the organization accept gifts?
• What type of gifts will be accepted?
• How will those gifts be acknowledged and recognized?
• How will gifts be disposed of or invested?
• What kind of stewardship will be provided to the donor?

If your organization needs to develop or review its policies, a good place to get samples of policies from other organizations using is to contact the AFP Resource Center.

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