Why Charities Have To Earn The Trust Of The Public
Charities are reliant on the generosity of the public and therefore need to work hard to maintain the trust of the public. It is important that charities are seen to be controlled and managed properly by their trustees, that their processes are transparent, and that donations received can be shown to have been utilised to fund the causes for which they were intended. The Charities Commission has processes in place for overseeing the management of charities and ensuring that donations are made in the public interest, but it is the trustees who bear ultimate responsibility and who have the capacity to earn or lose the trust of their support base.
The following 3 short stories reveal circumstances whereby lack of trust has had a negative impact on fundraisers for good causes:
1. Funding The Purchase Of A Lifeboat
The Royal National Lifeboat Institution (RNLI) was in the media spotlight recently for what some felt was the inappropriate use of their resources for rescuing migrants from the sea along the coastline of England. To counter this ‘bad press’ and express support and appreciation for the activities of the RNLI, a member of the public set up a fundraising page to raise funds to purchase a new life-saving hovercraft for the RNLI. The public responded and the page raised over £120,000 in a short space of time.
At that point, the RNLI released a statement thanking the public for their generosity but pointing out that the charity was not in need of seacraft as these generally had a useful life of between 12 and 25 years and that a hovercraft was not suited for the type of work conditions in the English Channel. They also noted that when looking to fund a lifeboat, they are bound by charity law to utilise restricted funds which may have been specifically gifted to the charity for use in funding the purchase of further seacraft. They, therefore, advised that they would be using the funds raised from this campaign towards their annual general running costs.
2. Reclaim These Streets
Back in March 2021, after the death of Sarah Everard who had disappeared whilst walking home in South London, a group of women wishing to show solidarity with those women who feel unsafe walking in the streets of London set up a group named “reclaim these streets”. As part of their activities, they decided to hold a series of vigils in her memory. Because this was in the midst of the COVID-19 pandemic, the police refused permission for the vigils to take place and threatened to fine the organisers £10,000. The group launched an online crowdfunding campaign with a target of raising £30,000. Within a few days, the page had raised donations exceeding £500,000.
The success of the campaign left the organisers with a legal dilemma as to how the funds should be spent, particularly as ‘reclaim these streets’ was not a registered charity. The committee decided to pass on the money to a charity called Rosa which is a grant-making trust dedicated to women’s charities and which makes grants to many grassroots organisations. This decision was important because in the days following the fundraising campaign many different organisations, having taken note of the popularity of the cause, tried to further their own agendas, some of which were not in line with the goals of the organisation, and claimed to be part of the ‘reclaim these streets’ network.
3. Rohingya Refugees
In 2018 the Charity Commission opened a statutory enquiry into a pair who raised money for Rohingya refugees. Two online fundraising platforms were set up and over £200,000 was donated by members of the public. The organisers of the fundraising campaign deposited the monies into their personal bank accounts and at the time of the investigation £68,748 could not be properly accounted for and, according to the commission, was likely to have been used for non-charitable private expenditure. The Charity Commission was able to transfer the remaining funds to registered charities supporting Rohingya refugees.
Recommendations for trustees
I would recommend that prior to any fundraising initiative, trustees read the guide produced by the Chartered Institute of Fundraising on ‘accepting, refusing and returning donations’. The document sets out the matters trustees should consider before they accept donations and asks them to approach any fundraising activities by considering how the charity could be impacted in different scenarios such as if volunteers are seen to be too aggressive or if an ‘influencer’ who has controversial views makes a donation to the cause and then publicises his or her support of the charity. The potential good a charity could achieve with funds generated by a fundraising campaign could be outweighed by the negative publicity caused by a message which is misunderstood or which alienates a segment of donors. Reputational damage can be irreversible and therefore it is essential that all communications, images and messages fit with the values and ethics of the charity.
Relevant to the cases I highlighted above, are the policies charity trustees should adopt in the event that insufficient funds were raised, and as a result, the charity does not have the resources to undertake the planned project. The CIoF recommends that a clause is drafted to the effect that in such a situation the money raised will go towards general charitable activities. A similar clause would also allow a charity that raised too much money to use the surplus for other activities. Where this has not been made clear prior to the campaign or, such as in the case of the RNLI, where the campaign is run by members of the public, outside of the charity, it is crucial that the charity engages with those parties and with the public to avoid misunderstandings and to clarify hoe funds will be utilised.
If you have any questions, don't hesitate to contact us or email me at yediya.zaiden@raffingers.co.uk!