Playing the Percentages: Re-Evaluating the Ethics of Paying Fundraisers by Commission

Dr. Ruth K. Hansen
Associate Professor, Nonprofit Management
Director, Institute for Nonprofit Management Studies
College of Business and Economics
University of Wisconsin-Whitewater

Most fundraisers are taught that paying fundraisers by commission – a percentage of the money they raise – is unethical. Yet despite the practice’s prohibition under the codes of practice of many countries and near-ubiquitous moral disapproval of commission-based remuneration, the ethical arguments against it are rarely put forward; when they are, they can be weak, or at least not as strong as they could/should be. And anecdotally, fundraisers report being asked – by organizations, administrators, and board members – to accept a percentage of money raised as their pay, contingent on immediate funds raised from the project, suggesting that the question is not well-settled in practice, or at least not broadly considered by the broader community.

But in a way, this hasn’t mattered, because if the ethical arguments fail, people can point to the code of practice and say that it’s banned. However, recent policy changes by the Fundraising Regulator in the UK in 2025 and Fundraising Institute of Australia in 2021 regarding commission-based pay has removed that argument in those countries. And so to convincingly argue against commission will require stronger arguments than we currently have.

The purpose of this discussion paper is to:

• Understand the weaknesses of the ethical arguments against commission payments
• Set out how those arguments might be strengthened
• Understand the ethical arguments in favour of commission payments
• Suggest safeguards and conditions to ensure that any time commission is paid, it is done so fairly and appropriately

The report’s authors are based in the UK, the US, and Australia. We do not argue for commission-based pay; but neither do we argue against it. We consider 14 arguments against commission-based pay: focusing on the welfare of donors; nonprofit organizations and their beneficiaries; philanthropy and fundraising; fundraisers, and other concerns. We also consider three arguments for commission-based pay. Taken together, these arguments set up ethical dilemmas, which we consider, and propose a series of recommendations.

The report is available at https://www.rogare.net/commission

Ruth K. Hansen, Ph.D., is an associate professor at the University of Wisconsin-Whitewater’s College of Business and Economics and director of the Institute for Nonprofit Management Studies. A scholar and former practitioner, she brings over two decades of fundraising experience to her research on philanthropy, resource mobilization, and inclusion in the nonprofit sector. Dr. Hansen was named a 2024 AFP Early Career Emerging Scholar alongside Dr. Lauren Dula. She serves on the board of the Nonprofit Academic Centers Council (NACC) and the Rogare Council, and chairs the Research Council for the AFP Foundation for Fundraising.