Should fundraisers be paid a fixed fee or a percentage of the money raised?

Some nonprofits pay fundraisers a percentage of the money they raise, but three major professional associations say that is a bad practice. Some reasons:

  • Most grantmakers don't approve of this practice and may deny the grant just for this reason.
  • If a grant writer writes a good proposal, but the grant is denied because of problems with the nonprofit, that's not the grant writer's fault.
  • Writing a grant proposal is hard work. Getting paid shouldn't be contingent on getting the grant.
  • You can't pay a grant writer with money from the grant, so where will the money come from?

Candid cannot recommend what is best for your situation. However, the resources below represent both sides of this issue, so that you can decide for yourself.

 

See also our related Knowledge Base articles:

- Where can I learn more about hiring a consultant?
- Where can I find technical assistance or a consultant for my nonprofit?

 

Guidelines, Codes, Standards
Association of Fundraising Professionals (AFP)  

A key mission of AFP is to advance and foster the highest ethical standards through its Code of Ethical Principles and Standards. Find them all here.

Professional Standards and Code of Ethics
American Grant Writers' Association (AGWA)

What AGWA members should and shouldn't do..

Ethics and Commissions in Grantwriting
Puget Sound Grantwriters Association

Good advice on ethics, especially for young nonprofits.

Position Paper: Professional Compensation
Association of Fundraising Professionals (AFP)

AFP believes very strongly that percentage based compensation is a bad idea for a number of reasons. It enumerates those reasons in this position paper prepared by the AFP Ethics Committee.

Commission-Based Compensation for Fundraising
ConservationTools.org

A Pennsylvania nonprofit's well-reasoned argument for why you should never do this.

In Search of Unicorns: Finding and Hiring Outside Grant writers, Part 2

Discusses how to find, choose, and pay grant writers, and essential elements in the hiring contract. Part 1 explores why hiring grant writers seems to be a hit-or-miss proposition; circumstances when a nonprofit should hire one; and alternatives to hiring.