Philanthropy Impact

Inspiring philanthropy and social investment across borders, sectors and causes

Take Care with Regulation

Expert opinion

It seems that people on all sides are agreed that there should be more regulation of fundraising.  There may be a need to improves standards, but so many fundraisers already operate at a level that is sophisticated, respectful and subtle. They are successful because of the level of trust that is shown by then and that is invested in them. Fundraising is a persuasive act of courtship that is about engagement and understanding.  

Henry Drucker, the late legendary fundraiser, told us that ‘people do not give for three reasons: they are not asked, they are not asked well and they are not thanked’.  

The recent problems are about not asking well, but asking in a way that is pestering and intrusive.  Chuggers, door-to-door, bucket shaking, raffles.  These methods have little (or nothing) to do with the charitable cause.  

Let's be careful that some of the negative  language in the press coverage about the recent review of fundraising practices in the UK, led by Sir Stuart Etherington, CEO of NCVO,  does not lead to a reduction in charitable giving. The report is of course well-motivated, Its aim is to increase trust and improve standards. But some of the press around it focuses only on the negative:  bad practice, banning, enforcement, regulation, sanction.  

Already in these days of austerity we have seen cuts of £3.5bn in statutory funds available to charities. With around 181,000 registered charities, in England and Wales alone, accounting for £65.4 bn turnover there is much at stake. 

Why do we give to charities?  It’s not compulsory, but part of what makes us human. Our compassion and kindness marks us out from other species. When we see suffering, then we are moved towards action.  

Charities are an excellent way of solving problems; alleviating pain, poverty or suffering; or developing opportunities to improve our chances of a cure or an enlightening educational encounter. It’s likely that they will be aware of the cause before they look for a channel through which they can give effectively.  Often people give to charities for reasons that are deeply personal. They may even be subconscious. They give because of a connection with a cause. They may give to cancer research because they have lost someone they love to cancer. They may give to a refugee charity because they have themselves sought refuge. 

Talk to any major donor – at the same time as voicing concerns about the adequacy and effectiveness of their chosen organisation they will tell you that they are backing the best horse.  If another organisation comes along and does it better, then they will switch. The power is with the donor. Not the regulator. 

Charities have a responsibility to present themselves in a way that is respectful and worthy of the considerable public trust and confidence invested in them. Donors need to feel secure in their choice that their gift will be well used and that it will make a difference. But no serious donor will await the permission of a regulatory body before making a gift.   

We advise organisations on how they can better engage with the interests of their donors. We find an incredible level of sophistication and awareness in donors. The challenge is to organisations to become more subtle and sophisticated; to display courage in their leadership and vision.  

At the same time, both individual giving and wealth have been increasing. Long may this continue. 

This expert opinion is tagged under:

  • Government, legal and tax issues
  • Strategy advice