Commission issues new guidance on accepting, refusing, or returning donations
Melanie May | 4 March 2024 | News
The Charity Commission has today (4 March) published new guidance for charities making decisions on whether to accept, refuse, or return donations.
The guidance is intended to help trustees when faced with a choice with potentially significant consequences. It advises that trustees:
- consider the risks involved in refusing or returning the donation, and how likely and serious these are. These include negative financial impact, ability to deliver services and ability to attract donations in future.
- consider the risks involved in accepting or keeping the donation, and how likely and serious these are. These include the likelihood of reduced support or reputational harm, particularly among supporters or beneficiaries.
- determine how any decision aligns with their charity’s purposes.
- determine what steps they can take to mitigate the risks. These include negotiating the terms of a conditional donation with the donor or developing a public explanation for a decision.
Trustees are also warned not to allow their personal views or external pressures unrelated to their charity’s purposes to influence them.
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The guidance also says that decisions shouldn’t be rushed and that trustees should take enough time to allow sufficient information to emerge, should balance short and long-term risk, and allow trustee boards to ask questions and challenge assumptions.
Orlando Fraser, Charity Commission Chair, commented:
“When charities are offered a donation, the law is clear that their starting point should be to accept unless there is very good reason not to.
“I hope this guidance will empower trustees to feel able to make the choice that’s right for them when faced with a tough decision. It has been designed to offer clarity and support as they navigate what can be tricky territory.
“As a proportionate regulator, we will not generally get involved, though may do so if trustees cannot evidence sound judgement and a considered process for their decision.
“Our new strategy commits to playing our part in securing greater philanthropic giving across England and Wales, and the clarity this guidance delivers is an important early contribution to that mission.”
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About Melanie May
Melanie May is a journalist and copywriter specialising in writing both for and about the charity and marketing services sectors since 2001. She can be reached via thepurplepim.com.