Ethics of philanthropy

Choosing suitable recipients of philanthropy, and ensuring that the aid is effective, is a difficult ethical problem, first addressed by Aristotle.[1][2]

Ethical questions include:[2]^:6–7

• how to compensate fund-raising agents;
• how to compete with other causes;
• how much deception, if any, is acceptable;
• whether some images ("pornography of poverty") should not be used, even if they are effective.

Many gifts are accompanied by a statement of intent, which may be a formal, legal agreement, or a less formal understanding. To what extent the recipient must respect that intent is an ethical and legal issue, especially as circumstances and social norms change.

When a person's activities are incompatible with an institution's mission, associating with them or accepting donations from them may be considered inappropriate or dishonest marketing (cf. greenwashing), a form of conflict of interest.

For example, children's museums generally refuse sponsorship from manufacturers of junk food.[3]

Protests against David Koch's support for climate change denial led to his resignation from the board of the American Museum of Natural History.[3]

Funds derived from, and donors engaged in, unethical, immoral, or criminal activities pose a problem for the recipient, as accepting a donation or continuing to benefit from it may be interpreted as benefiting from or ignoring the disreputable activity.[4] Such donations has been characterized as "toxic philanthropy".[3]

This is an issue not only for the donor's behavior before the donation, but even after. Institutions may respond to scandals by returning the money, removing the acknowledgement, or by doing nothing.[5]

For example, the Sackler family is a major donor to many cultural and educational institutions which has had many buildings and programs named for it. Because of its association with the opioid epidemic, many activists have urged the recipients to remove the name.[6] Some institutions have announced that they will remove the name or accept no further donations from the family.[7][8] Harvard has said that it will not remove the name from the Arthur M. Sackler Museum because "Dr. Arthur Sackler died before [Oxycontin] was developed. His family sold their interest in the company before the drug was developed.... he had absolutely no relationship to it".[9] For further information, see Sackler family § Philanthropy.

Similarly, the sex offender Jeffrey Epstein was a major donor to many university programs, even after his conviction for sex crimes. After it emerged that the director of the MIT Media Lab, Joi Ito, was not only aware of Epstein's misdeeds, but took steps to solicit donations while hiding their source, Ito resigned.[10][11] For further information, see Jeffrey Epstein § Philanthropy and Joi Ito § Ties to Jeffrey Epstein.

M.I.T. and Harvard have both initiated reviews of donations by Epstein.[12][13] The M.I.T. review concluded that:

Since MIT had no policy or processes for handling controversial donors in place at the time, the decision to accept Epstein’s post-conviction donations cannot be judged to be a policy violation. But it is clear that the decision was the result of collective and significant errors in judgment that resulted in serious damage to the MIT community.[14]

Therefore when thou doest thine alms, do not sound a trumpet before thee

— Matthew 6:2

Donors are generally acknowledged publicly for their donations, which benefits their reputation. It has been argued that this should be treated as a business transaction.[15] Many philosophers have argued that donations should be anonymous for this reason.[16]

Beyond that, receiving something of value in return for a donation is considered both legally and ethically a quid pro quo.[17]

• Peter Singer, "Dirty money and tainted philanthropy", New Europe, February 7, 2019
• Ernie Smith, "Amid Epstein Scandal, Fundraising Group puts focus on Ethics in Philanthropy", Associations Now September 19, 2019
• Jim Rendon, "How to Protect Your Nonprofit From Controversial Donors", The Chronicle of Philanthropy, September 19, 2019

• Charity fraud
• Category:Charity scandals
• List of Philanthropists
• Philanthropy in the United States
• Effective altruism