In what is fast-becoming an infamous speech, Orlando Fraser, the chair of the Charity Commission announced last month that the commission will soon revise its guidance* on the acceptance and refusal of donations.
In accordance with those proposed revisions, Fraser said one thing that might trigger a regulatory intervention by the commission would be a “materially irrational” decision by trustees, whose “righteous progressiveness” results in them being “squeamish” about accepting funding from sources they don’t like.
Fraser’s comments provoked a sceptical response from many in the sector, who argued that this was a straw man argument, and is another front against charities in the culture wars. His timing and rhetoric certainly suggest that is the case, and I don’t doubt this was his intention.
But if you remove the rhetoric, then a lot of what Fraser said isn’t untrue.
Charities need good reasons to refuse a donation. Check.
Refusing a donation could have harmful effects on beneficiaries. Check
Trustees should not let their own personal moral views influence what is in the "best interests" (which the commission has never fully defined) of their charities when considering whether to refuse a donation. Check.
None of these statements – all reiterated in Fraser’s speech – tells us anything we didn’t already know.
I think there are four things we can take from Fraser’s speech.
First, yes, this is almost certainly a culture wars attack on charities, but let’s separate that from the issues about gift acceptance/refusal, which are the second point.
Many fundraisers have stories of trustees not wanting to work with donors whom the fundraiser wants to accept donations from or enter into partnerships with, based on reasons that might be described as, if not as exactly irrational, then maybe not grounded in the most watertight reasoning, just as Fraser alleges.
On the other side of the coin, there are also cases of fundraisers having strong moral objections to working with particular donors, but trustees override these and make the "rational" decision to accept the donation because doing so is in the charity’s "best" interest, which often means prioritising the money, but discounting other concerns.
If a charity has a robust and well-thought-through gift acceptance policy, and fundraisers understand the ethical challenges in implementing that policy, then many such ethical decisions will never get to board level to give trustees the opportunity to exercise any moral squeamishness.
Incidentally, the Chartered Institute of Fundraising is publishing revised guidance on how to construct acceptance/refusal policies next year, and I’m writing a paper on the ethics of acceptance/refusal to accompany that new guidance.
Finally, what evidence does the Charity Commission have that cases or squeamishly irrational decision making have reached the point that the regulator just has to step in to stop it happening?
The principles of better regulation state that regulation needs to be targeted at and proportional to any problem it seeks to redress.
If the problem is not as big as Fraser suggests but the commission puts in place regulatory measures that are excessive, then it would fall foul of those principles. The onus is really on the commission to justify why such regulatory interventions are necessary.
Do they really have the evidence that would justify this? (Culture wars rhetoric is not admissible.) They might, but I doubt it, which leads to my fourth point.
Some trustees are forever sticking their oars into executive matters where their oars have no business being (their role is governance), particularly regarding fundraising practice.
The fundraising profession is also full of apocryphal stories – so many that they must have a foundation in reality – about trustees who have exercised their influence to stop charities using types of fundraising (typically telephone or various types of F2F) that they are ‘morally squeamish’ about.
But while there have been a couple of studies that look at the attitudes and behaviours of boards that support and foster fundraising, I am not aware of any serious research that has sought to explore trustee behaviours and attitudes that inhibit or undermine fundraising (Rogare’s work on donor dominance highlights a few).
If that research were conducted, I am sure we would have robust evidence that many trustees did, in fact, make irrational decisions about fundraising based on moral squeamishness.
But the bulk of that might demonstrate irrational decision-making in choosing not to use – or veto – the most effective fundraising methods. And that might not align so well with the anti-charity culture wars rhetoric.
Ian MacQuillin is director of the fundraising think tank Rogare
*Charity Commission guidance on accepting/refusing donations is included in CC3 (s6) and CC20 (s6), but is not currently contained in a single document titled something like ‘guidance on accepting/refusing donations’.