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Fundraising – Keeping the media, the Charity Commission and the judges at bay

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Fundraising – Keeping the media, the Charity Commission and the judges at bay

'Independent schools are particularly susceptible to being caught out by data protection legislation because they hold personal data on alumni'

Charitable fundraising has been in the headlines all summer, most recently with Sir Stuart Etherington’s fundraising review. The review, and the Government’s response, raises more questions than it answers, but it is clear that charities should be taking action now rather than waiting to see what new fundraising regulator is eventually created.

The sad death of Olive Cooke understandably prompted a wave of criticism of charities by the media and politicians. Following the Cup Trust scandal and coinciding with the Kids Company allegations, media interest in fundraising horror stories remains strong and with over 160,000 charities in operation there may be no shortage of dubious practices to sustain it. In the current media environment, schools must be prepared to defend their fundraising practices at short notice.

The other recent significant fundraising development is the case of Ilott v Mitson about a contested Will, which raises questions about legacies, potentially relevant to all independent schools.

ENDING UP IN THE SPOTLIGHT

After Olive Cooke committed suicide it was found that she had received hundreds of requests for support from charities every month. Mrs Cooke’s family have made it clear that the charities which contacted her with fundraising requests were not to blame for her death. However, the Charity Commission has written apparently standard form letters to those charities requesting a wide range of information about their fundraising activities. The Fundraising Standards Board has also been asking similar questions to those of its members who were involved. Separately, the Charity Commission has written to charities whose accounts disclose low returns relative to their fundraising costs, asking them to justify their fundraising activities. The lessons are clear: it is not enough for a charity to act properly and lawfully when fundraising, it must also be prepared to justify its actions and demonstrate compliance with the law and best practice.

ACTIONS TO TAKE – LEGAL

To be prepared in the current media environment, compliance with the law is an essential first step. Every board of governors should be confident that their school’s fundraising function is compliant with fundraising requirements and with data protection legislation. It is not just a box-ticking compliance issue but also a pragmatic step to maintaining supporters’ goodwill and being prepared in case the school does find itself to be the subject of adverse media attention.

Independent schools are particularly susceptible to being caught out by data protection legislation because they hold personal data on alumni for many different reasons, stretching far beyond fundraising. Detailed compliance advice is outside the scope of this article, but two common failings of schools are not being clear about all of the purposes for which they are collecting and holding personal data and not holding data in a sufficiently secure way. For example, do your terms permit you to transfer data to third parties such as alumni website providers or mailing companies, or to other schools if you run joint events, merge, support local academy schools or establish schools overseas? With regard to security, where is the data stored, who has access to it and is it ever transported on laptops or USB sticks? Are the alumni and school websites secure?

ACTIONS TO TAKE – GOOD PRACTICE

There is extensive and ongoing debate in the sector about what constitutes fundraising good practice, but there are certain ‘low-hanging fruit’ that can easily be achieved by even small fundraising operations. Adopting a vulnerable person’s policy should be the first step, and it is notable that media stories tend to focus on vulnerable people. It is not enough for fundraisers to act sensitively and with common sense towards those who are vulnerable: proper standards of behaviour by the school’s fundraisers should be set out in an up to date policy, which may be produced in response to media or Charity Commission interest. The governors should be able to demonstrate how they ensure compliance with the policy.

Similarly, it is advisable to have a policy which limits the frequency of contact with alumni or other donors or potential donors, and records to enable the school to demonstrate compliance with this policy. Some schools are members of fundraising organisations which self-regulate and when deciding whether or not to join such an organisation one of the advantages to consider is the ability to point to your membership and your compliance with their rules when facing critical press or regulator attention which could otherwise damage the school’s reputation.

KEEPING RECORDS

There was substantial coverage of the recent Court of Appeal ruling in Ilott v Mitson, where a mother’s Will leaving the majority of her estate to three charities was partly overruled in favour of an estranged adult daughter. The case revolved around what reasonable provision was in the particular circumstances of the deceased, rather than the actions of the charities. However, as part of their assessment the judges gave weight to the fact that the charities could prove no previous relationship with the deceased and that, like the estranged daughter, the charities had no expectation of a legacy. There is a suggestion that, had the charities been able to prove a link with the deceased or an expectation of a legacy, the assessment of what was reasonable might have been different.

It follows that schools wishing to maximise legacy income should aim to keep full records of their historic donors, volunteers and newsletter recipients. They should also aim to identify every supporter’s link to the school, which is clear in the case of alumni but more difficult for others, such as parents or widows/ers of alumni. Data use statements used by the school may have to be expanded to permit storage of individuals’ data for long periods in case they leave a legacy to the school which is disputed after their death. Current data protection legislation only applies to data about living people and so terms of use which permit lifetime storage of an individual’s data is sufficient, but the legislation may be widened in the future to cover certain data about dead individuals and so it is advisable to provide for data storage after death for the purpose of defending any legacy disputes.

If schools provide wording or advice to supporters wishing to leave a legacy, they should take into account the lessons from this case. In particular, they should encourage those supporters to explain in writing what their link is with the school and why they wish to support it. They should also encourage supporters to explain to any close relatives who may be disappointed by the Will why the supporter wishes to favour the school, and to make a note that they have done so.

20 Oct 2015