Last week, Sir Stuart Etherington's report on the regulation of charity fundraising was published. Its wide-ranging recommendations on the future regulation of charity fundraising have been met with interest by stakeholders throughout the charity sector – and not least by charity trustees.
Charity trustees have always been ultimately responsible for the affairs of charities, and that will remain the case. But the report focuses sharply on charity trustees, whom it describes as having "too often been absent from discussions on fundraising practice or values" and needing to be one of the "three lines of defence" in a new approach to fundraising regulation.
Taken together with an amendment to the Charities (Protection and Social Investment) Bill, which would require trustees to make a statement in their annual report each year setting out their approach to fundraising, trustees should now consider a wholesale review of their charities' fundraising strategies and the procedures they have in place, particularly in relation to protecting the vulnerable in the course of charity fundraising.
The report does not recommend changing the nature of trustees' responsibilities in relation to fundraising – in any event, they are already ultimately responsible for all the activities of their charities. But it does recommend placing a greater burden on them to prove they have met them and, in doing so, have ensured that their charity is compliant with the Code of Fundraising Practice, the control of which Etherington recommends is transferred to a new regulatory body, the Fundraising Regulator.
There is a little carrot and much stick for the trustees in the recommendations of the report. It recognises that the Code of Fundraising Practice needs to relate more clearly to the guidance provided to trustees by the Charity Commission, known as CC20, so that trustees are able to discern more clearly their responsibilities and how to go about fulfilling them.
As for the stick, the report suggests that the proposed new Fundraising Regulator should have the power to report trustees to the Charity Commission if it believes that they have breached their duties in relation to fundraising matters.
Given both the report and the bill, it is clear that there will be a greater onus on trustees to take an active role in the formulation of fundraising strategy and values. Those strategies and values must aim, in the report's view, for a better relationship between the charity, its donors and the wider public. The report does acknowledge the tension between "the public's right to be left alone and charities' right to ask", but places the difficult job of balancing those competing interests on the shoulders of charity trustees.
Trustees, in summary, need to act now to review the mechanisms they have in place to ensure full compliance with the proposed new rules and adherence to the fundraising strategy they set for their particular charity.
Rob Posgate is a solicitor in the charities & philanthropy team, Withers LLP