Can Ethical Principles Help Drive Social Impact?

Recently, Independent Sector Board Member and President of the Bush Foundation Jennifer Ford Reedy wrote about how doing good is more than about your output, but rather your impact in community. This got me thinking about our own work considering charitable sector ethics and three 21st Century challenges:  data and technology, environmental impact, and equity.

In her work, Reedy says she considers her own “net good,” by asking herself questions like, “How can I do a bit more good this year? How can I cause a little less harm?”

When thinking of our own ethical practices as organizations, it is good for us to think about our own impact beyond just strong financial oversight and good governance , which are important areas that are part of our Principles for Good Governance and Ethical Practice. Using that as a hypothesis, we talked to about 50 leaders at the Young Nonprofit Professionals Network (YNPN) National Leaders Conference and at Upswell in 2018 to consider broad 21st century social challenges that should be addressed by our own ethical behaviors and practices. Here’s what we heard:

Rapid Pace of Data and Technology

The cost of staying up to date with the latest digital infrastructure is significant, but the long-term opportunity cost of not doing so may be even greater. Leaders are thinking about large infrastructure shifts like the European Union’s implementation of the General Data Protection Regulation (GDPR), as well as organization needs around data management, cybersecurity, and ethical data training.

Leaders are also concerned with how data is collected and used. Some communities are hesitant to engage with data collection efforts because of age, historical abuses, cultural, and language barriers. Leaders recognize the need to build trust with those communities, and to transparently communicate across the board about why data is collected and how it will be shared back with communities. Sufficient organizational policies must be in place to ensure this happens, and that user privacy and preferences are protected – whether collecting personally identifiable information (PII) or pictures on social media.

How to Do No Environmental Harm

Leaders wonder whether the sector overall is responding sufficiently to the threat of rapid climate change. They also discussed specific levers that could have a system-wide impact – for example, leveraging corporate engagement to advocate for sustainability and even adopting gift acceptance polices that prioritize sustainable practices.

Tactically, leaders worry about the up-front costs needed to shift organizational practices to be more environmentally friendly. For those working on other issues, there is a high-perceived opportunity cost in even paying attention to the environment.

Equitable Outcomes for All to Thrive

On the board level, more conversations are needed to define equity and diversity, and embed those definitions into board recruitment processes. Leaders discussed the importance of lived experience as a selection criterion, in addition to the other skills needed for a well-rounded board. Boards should also consider their responsibility as advocates when it comes to issues like #metoo – and they should keep in mind that staying silent is saying something. Even when boards and staff advocate, do they also walk the talk internally?

On the staff level, leaders discussed the need for equity capacity building on a variety of issues, including building “ally cultures” that support staff at risk of “advocacy fatigue” and keeping up-to-date with inclusive language and literature. Leaders also expressed the need for increased transparency – around compensation, salaries, professional development, and future growth opportunities.

Fundamental Principles Are Still Critical

Across all conversations, a few themes rang clear. The tone at the top is critical – CEOs and boards must lead the way. While long-term strategic responses will ultimately have the biggest impact, there are also opportunities for short-term wins through existing policies and procedures. For example, several of IS’ 33 principles already offer guidance related to the challenges listed above and could be easily tweaked to more clearly emphasize data and technology, environmental impact, and equity.

  • Principle 6 (asset protection) includes data in asset protection planning.
  • Principle 7 (public information) emphasizes the importance of transparency.
  • Principle 11 (board diversity) emphasizes the importance of diverse perspectives on boards of directors.
  • Principle 30 (gift acceptance policy) encourages organizations to think about the types of donations they will accept.

At its core, the Principles for Good Governance and Ethical Practice is a guide for the sector to build high-performing organizations that gain and retain the public trust and fulfill their charitable purposes. Beyond the focus on impact of the social issues listed above, Independent Sector is also committed to working with nonprofits and policymakers to improve rules for transparency and accountability to reduce burden on individual organizations, while also signaling that our sector is worthy of the privileges that come with our tax-exempt status.

We look forward to continuing to reflect with the charitable community on how ethical guidance can help us increase our “net good” in the world.

Learn more about the Principles.


Help Us Improve our Resources on Ethics & Accountability
We need your feedback to improve our ethics and accountability resources and programming. Please complete this five-minute survey by Friday, March 8. One lucky survey participant will win a free registration for the upcoming Independent Sector/Nonprofit Leadership Alliance online course on ethical leadership. The course starts in mid-April, and your free registration is transferable to a peer or colleague.

Types: Blog, Policy Update
Global Topics: Data, Environment, Ethics and Accountability, Public Policy, Race, Equity, and Inclusion, Voices for Good
Policy Issues: Nonprofit Operations