12 Guides for Transparency to Build Donor Confidence

Nonprofits hold a public trust, and in return for tax advantages, they have a moral and legal obligation for transparency.

While the primary role for fiduciary responsibility lies with the board, staffs also have a moral obligation to be watchdogs. Often staffs are in the best position to see current or approaching transgressions.

Transparency means:

• Having financial information on your website.
• Not hiding compensation such as deferred compensation and other benefits from the full board and key stakeholders.
• Having program measures in place and reporting them to investors.
• Honest communication from the board when the organization has gone adrift.
• Open CEO search processes that reflect the organization's culture and values.
• Fulfilling commitments made in gift agreements and keeping the donor informed.
• Enforcing conflict of interest policies with the board and senior staff.
• Being up-front and consistent in reporting fundraising and other administrative costs.
• Being honest and responsive with media inquiries.
• Having whistleblower procedures that are vetted by a committee and protections for those who come forward.
• Participating in charity-rating programs.
• Honestly reporting benchmarking information for comparable ratings.

Mahatma Gandhi once said, "Truth never damages a cause that is just." A culture of transparency is a big commitment and can be tough. But it is the right commitment and one that builds confidence in donors, staff, volunteers and other stakeholders.