Editorial: The downside of transparency

The Charity Commission's decision to announce all its statutory inquiries could increase public trust in charities, but it might also result in reputational damage for the sector, writes Stephen Cook

The new system is of piece with a tougher approach approach to compliance by the regulator, writes Stephen Cook
The new system is of piece with a tougher approach approach to compliance by the regulator, writes Stephen Cook

Hitherto the Charity Commission has announced that it is conducting a statutory inquiry into a charity only if it considers it is in the public interest to do so.

It has also been prepared to confirm whether or not it is conducting an inquiry if it is given a name by the media. The problem with the first part of this is that the public interest is a flexible concept, and with the second that it can be random and unfair.

After some internal agonising, the commission has now changed its approach so that it will make an announcement about all its statutory inquiries unless it considers it to be in the public interest not to do so or there is a legal reason not to, such as a concurrent police inquiry. This is welcome as a more equitable and transparent system, although the problem of defining public interest remains. But there is a potentially more serious concern.

Put simply, mud sticks. A good example came last week, when the commission implemented its new policy by revealing 13 more inquiries currently in hand. One concerns Muslim Aid, about which The Times produced a page-lead story the next day. If the inquiry report finds no fault, will that attract similar publicity? What will stay in the public mind? And what is going to come up first on internet searches?

The new system is of a piece with a tougher approach to compliance by the commission recently. In one sense it will potentially increase public trust and confidence in charities, not least by creating an incentive for charities to conduct themselves in such a way as to avoid becoming the subject of an inquiry; but in another sense, it might end up doing a deal of reputational damage to the sector.

The print edition of Third Sector will from now on be published monthly rather than weekly: this is the last weekly, and the first monthly will appear on 27 June. But this editorial column will continue to appear in a new digital weekly edition that will be available to subscribers shortly, both as an iPad edition and by email: the launch date will be announced on Thirdsector.co.uk.

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