A tale of two fundraising appeals

Friday's Red Nose Day was given higher marks for transparency than Children in Need.

Comic Relief: 'more committed to transparency'
Comic Relief: 'more committed to transparency'

Old wounds from last year's row about the transparency of Children in Need were reopened last week when a national newspaper revealed that the host of the appeal, Sir Terry Wogan, was paid in excess of £1,000 an hour for fronting the show.

The news sparked further criticism from donor information website Intelligent Giving, which claimed that the payment, though technically above board, "left a bad taste in the mouth". Children in Need says it has never paid Wogan and that the matter is between him and the BBC.

Intelligent Giving last year accused Children in Need of lacking transparency, but it has, by contrast, encouraged people to give money to Comic Relief, which stages Red Nose Day this Friday.

Adam Rothwell, features editor at Intelligent Giving, says that Comic Relief is more open about its practices. "The real difference is that Children in Need seemed at first not to be particularly interested in transparency," he says.

It had an indifferent approach to completing its summary information return to the Charity Commission and there were mistakes in the data, claims Rothwell. "It gave the impression it handed this job to the work experience person on their first day," he says.

"Comic Relief shows it is more committed to transparency. Its annual report gives the sense that this is a very open and honest organisation.

It says Sport Relief did not go very well last year and that it is looking at ways to improve that. It is also talking to us about more ways to be transparent."

Every penny goes to the cause
Children in Need is also too singularly focused on fundraising, according to Rothwell. "Comic Relief, on the other hand, uses its campaign as a good way of raising awareness," he says. "It uses its appeal to draw the public's attention to the big issues, and in a way that only Comic Relief can."

Roger Lawson, director of strategy and planning at Cascaid Marketing, says Comic Relief's openness encourages donors to give again. "Comic Relief understands that you are not going to get more money out of a donor unless you talk about where the money has gone," he says. "It puts a lot of effort into talking to people about the work it does. It's very good at saying 'thank you' - not directly, but in an inspiring way."

Transparency remains an issue for charities, adds Lawson. "The problem is that transparency and accountability are very dull words," he says.

"But it is about treating your donors well and inspiring them to donate again."

The lack of transparency and negative publicity about funds not spent by the Disasters Emergency Committee, which raised more than £300m in the two months after the Asian tsunami in December 2004, put some people off giving, Lawson claims.

Simon Burne, senior consultant at Think Consultancy Solutions and former chair of the Institute of Fundraising, says large appeals can legitimately claim - as Children in Need has done - that every penny donated will go to good causes because they have corporate sponsors bankrolling their overheads.

But this message can cause difficulties for the rest of the sector. "The problem is how people hear that," says Burne. "It could be that the campaign is run by volunteers and there are no overheads. But when people think charities can run for nothing, that is not true.

"The implication is that charities should not spend any money on administration, but this is dangerous because charities that spend no money on administration tend to be run inefficiently."

Megan Pacey, director of policy and campaigns at the Institute of Fundraising, praises Comic Relief for being open. "It has certainly made a significant effort in the past year or so to become more transparent," she says. "That's not to say it is completely there yet, so we should continue to encourage it.

"This is a challenge to the whole sector. Comic Relief just happens to be one of the organisations that has sat down and decided to get better."

A spokeswoman for Comic Relief says the organisation aims to communicate its work to a wide audience. "We are constantly looking for ways to broaden our communication," she says. "We rigorously assess our annual report and accounts each year, and we try to work out how we can do things better and, in so doing, improve our transparency."

A spokeswoman for Children in Need refutes what she calls the "damaging claims" made by Intelligent Giving about the organisation's transparency.

"Our financial statements are independently audited each year," she says.

"In common with every other charity, we're required to file them and the supporting returns with the Charity Commission."

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