What do donors deserve to know? Rethinking transparency in nonprofits

By Nel Taylor, (Umatilla) they/them, he/him — queer, trans, fat, organizational equity strategist, ethical fundraising expert, and nonprofit systems fixer

Transparency isn’t just a tactic for fundraising campaigns. It’s what the community deserves, especially when you’re asking them for money. And yes, when you practice it, you’ll raise more, build deeper relationships, and future-proof your organization.

Nonprofits are built on trust. People pool their money together, hand it over to professionals, and say: we trust you to take care of this issue on our behalf. And yet, when things get messy behind the scenes with leadership conflict, financial missteps, staff unionization, and layoffs, too many organizations fall back on the same response: no comment.

The problem with “no comment” isn’t just that it erodes trust (I mean, it does. Obvi), but it actively creates skepticism. It makes people wonder: What aren’t you telling us? What’s being hidden?

This essay is totally not about an organization in my community who did not totally fumble a financial and staffing crisis, and was actually very transparent about their finances and toxic leadership. There was definitely no media frenzy and the community had zero interest in what the hell was going on. Everything was totally perfect and went very smoothly.

It’s called transparency, sweaty

This isn’t about PR. This is about justice.

When nonprofits rely on the community to fund their work, the community deserves to know what’s happening inside the organization, at least at a high level. It’s about:

• Accountability: We’re stewards of community resources. That means reporting honestly about how we got into a crisis and how we’re going to get out of it.

• Informed consent: Donors should know what they’re funding. If the organization isn’t stable or doesn’t have a plan, people deserve to make their giving decisions with that knowledge.

• Relationship & trust: Fundraising is about relationships and relationships are built on honesty. If you only tell the truth to five donors who are able to give the biggest gifts, but not to the hundreds of donors who are also giving at a level meaningful to them, but may not have as much accumulated wealth, you’re gatekeeping and breaking trust with the majority of your donor base.

Here’s what really bothers me about that last one: when orgs choose to disclose more to “major” donors and less to community donors, they’re assuming those wealthy donors will keep their secrets. They’re assuming those donors have “better judgment” or “more discretion” than someone giving $25. But let’s be real, no one has signed an NDA. No one owes you silence. Why assume discretion from wealth, except for the belief (whether admitted or not) that wealthy people are somehow more trustworthy?

What transparency isn’t

Transparency doesn’t mean airing dirty laundry. It doesn’t mean gossiping about who was “difficult to work with” or disclosing medical leave. It doesn’t mean character attacks.

It means sticking to facts, not hearsay. Actions, not personal judgments. Framing that is truthful, respectful, and high-level enough to protect privacy while still giving clarity.

For example:

• Not “Our ED was selfish and only looked out for themself.”

• Instead: “We made a leadership change after financial decisions put the organization at risk.”

See the difference? It’s factual, it’s accountable, and it doesn’t drag anyone through the mud.

Who are we protecting, really?

Nonprofits often avoid transparency out of fear: fear of lawsuits, fear of reputational damage, fear of “scaring donors.”

Here’s the thing:

• If you’re sharing true, objective facts, the legal risk is usually low. The bigger risk of a potential lawsuit may be financial. For example, a lot of nonprofit settle a case out of fear rather than fighting an illegitimate defamation case from former leadership.

• Donors who don’t care about transparency will keep giving. Donors who do care are the ones you’ll lose if you stonewall.

• Staff morale plummets when leadership refuses to acknowledge the reality everyone already knows.
  

When boards block transparency, they’re usually protecting themselves. When staff push for transparency, it’s because they know the community, they’re getting the questions, and they’re living the impacts. Transparency should be staff-led.

What the community actually wants to know

If I were giving to an emergency campaign or an organization in crisis, here’s what I’d want to know:

• Why are you in this emergency?

• What have you learned so it doesn’t happen again?

• How does my gift stabilize you now?
  

That’s not a lot to ask. It doesn’t require pages of detail. But it’s a whole lot more trustworthy than “We’re just going through tough times.”

Here’s where I land:

• You don’t have to put every hard truth in your appeal email.

• But when someone asks directly, lying or dodging is not acceptable.
  

If you’re willing to tell a “major” donor something behind closed doors, you should be willing to say it to the community, rather than just hoping nobody notices.

The way nonprofits handle transparency is about more than one campaign. “Polite dishonesty” has long been used to protect institutions at the expense of people, especially Black, Indigenous, people of color, and other oppressed staff. It’s a classic white supremacy culture move: keep things “professional,” avoid conflict, and smooth things over for the comfort of those with the most power.

But transparency — honest, accountable, clear communication — is how we build a different culture. It’s how we include neurodivergent folks who need direct information, how we restore community trust, and how we show donors that we take their partnership seriously.

So here’s my challenge to nonprofit leaders:

Stop being afraid of honesty. Stop worrying that donors can’t handle the truth.

Transparency isn’t just a tactic for fundraising campaigns. It’s what the community deserves, especially when you’re asking them for money. And yes, when you practice it, you’ll raise more, build deeper relationships, and future-proof your organization. Because the $25 donors who expect radical transparency today? They’re your $25,000 donors tomorrow.

Sure, it’s a strategy, but it’s also just the right fucking thing to do.