Expert Insights: Why Your Nonprofit Needs an AI Policy

Our friends and partners at Grand River Agency have earned a new certification in Artificial Intelligence for Nonprofit Marketing & Fundraising. So they’ve been particularly attuned to the policies that must be in place for nonprofits to use AI ethically and effectively. Chief among these, your nonprofit needs an AI policy.

Grand River Agency President Kelsey Boudin recently wrote a blog breaking down why an AI policy is necessary – whether you’re leading a large or small nonprofit. (You can read it here: 5 Reasons Your Nonprofit Absolutely Needs an AI Policy in 2025.)

As you know, AI is no longer a futuristic concept. It’s here, and it’s transforming the way organizations both produce communications for donor cultivation and predict engagement patterns. For nonprofits, AI offers incredible opportunities to streamline operations, enhance donor engagement and maximize impact. However, with great power comes great responsibility. 

Let’s summarize why Grand River Agency says a formal AI policy is essential and how to create one that aligns with your mission and values.

What is an AI Policy for Nonprofits?

An AI policy is a set of guidelines that outlines how your organization will use artificial intelligence. It covers everything from data privacy and ethical considerations to accountability and transparency. Think of it as a roadmap for integrating AI into your operations responsibly.

Why Your Nonprofit Needs an AI Policy

1. Ethical Responsibility: Nonprofits are held to high ethical standards. An AI policy ensures that your use of technology aligns with your mission and values.
2. Data Privacy: AI often relies on sensitive donor and beneficiary data. A policy ensures this information is handled securely and in compliance with regulations like GDPR or CCPA.
3. Transparency: Donors and stakeholders want to know how their data is being used. An AI policy fosters trust by clearly communicating your practices.
4. Risk Mitigation: AI can introduce risks, such as bias or misuse. A policy helps identify and address these risks proactively.

Key Components of a Formal AI Policy

1. Purpose & Scope: Define why your nonprofit is using AI and the areas it will impact (e.g., fundraising, program delivery, communications).
2. Data Governance: Establish guidelines for collecting, storing and using data. Ensure compliance with privacy laws and ethical standards.
3. Bias & Fairness: Address how your organization will identify and mitigate biases in AI algorithms to ensure fair treatment of all stakeholders.
4. Transparency & Accountability: Outline how decisions made by AI systems will be explained and who will be responsible for oversight.
5. Staff Training: Provide guidelines for training staff on AI tools and ethical considerations.
6. Monitoring & Evaluation: Set up processes to regularly review and update your AI systems and policies.

How to Create an AI Policy for Your Charitable Organization

1. Assess Your Needs: Identify where AI can add value to your organization and the potential risks involved.
2. Engage Stakeholders: Involve staff, board members and even donors in the policy development process to ensure buy-in and alignment with your mission.
3. Draft the Policy: Work with strategic communications professionals and legal experts to create a clear, actionable policy that addresses your unique needs.
4. Implement & Train: Roll out the policy and provide training to ensure everyone understands and adheres to it.
5. Review & Update: Regularly evaluate your AI systems and policy to ensure they remain effective and ethical.

The Future of AI in Nonprofit Fundraising & Communication

AI is already revolutionizing the nonprofit sector. But the benefits of its efficiency and efficacy can be experienced only if it’s used ethically and responsibly. By creating an AI policy, your organization can harness the power of technology while staying true to your ethical commitments.

Grand River Agency is at the forefront of using artificial intelligence for good to help nonprofits communicate their mission and raise needed funds to support it. Developing an AI policy can feel daunting, like any other facet of strategic communications. They will work alongside legal experts to guide you every step of the way. Grand River Agency’s team can help you:

• Assess your organization’s AI readiness.
• Draft a customized AI policy that reflects your mission and values.
• Train your team on ethical AI practices.
• Provide ongoing support to ensure your AI initiatives succeed.

Ready to take the first step? Contact GRA President Kelsey Boudin directly at kelsey@grandriveragency.org today.