Charities should avoid hastily promising to return unwanted donations from organisations such as the Presidents Club until they know whether they are allowed to by law, according to Sarah Atkinson, director of policy, planning and communications at the Charity Commission.
Speaking at the Institute of Fundraising’s fundraising compliance conference yesterday, Atkinson warned charities that handing back donations was complicated and often not legally possible, and making promises based on media and public pressure could lead to embarrassing U-turns later on.
Atkinson’s comments come after the Presidents Club scandal earlier this year, where donors at the charity’s men-only City of London fundraising gala were accused of sexually harassing women hired as hostesses.
But Atkinson said a number of charities that said they would return the donations had subsequently found that they could not return the money or that it was extremely difficult to do so.
"Some of them had got themselves into a bit of a mess and had to backtrack," she said. Atkinson said this could alienate both those donors in favour of keeping the funds and those who thought the money should be returned.
"If you find yourselves in that position again, don’t ever commit to returning money until you’ve checked out whether you can," she said.
"Even if you can, that doesn’t mean you definitely should; and if you can’t, then you’re not going to be able to even if you feel you ought to."
Atkinson said that the governing documents of many charities did not allow donations to be returned. Those charities would probably need Charity Commission permission to do so, she added.
"You might feel under pressure to return the funds, but I’m afraid the Charity Commission isn’t going to tell you that you must or even that you can because you feel under pressure," Atkinson said.
"We are going to have to see the case that says it is in the long-term interests of the charity."
Daniel Fluskey, head of policy and research at the IoF, told the conference that polls showed an overwhelming majority of the public thought charities should keep the Presidents Club donations. But he said that the charity’s interests should be the main factor in deciding whether to return money.
"You need to be mindful of what the public say and what they think charities should do, but your decision has to be the right decision for your charity," he said.
"It has to be public opinion-informed, not public opinion-driven."
Fluskey said it was important to have donation-refusal policies in place for staff to follow if a crisis happened, and the IoF would be issuing guidance on the issue in the next month.