Stephen Cook: Will change to fundraising self-regulation be adequate without structural change?

If the current structure was sufficiently responsive to public concern, the changes now being contemplated might have been made long ago, writes the editor of Third Sector

Stephen Cook
Stephen Cook

It’s rare for one voluntary sector organisation to stand up in public and criticise another or tell it what it should do, so when that happens it is worth taking notice. And happen it did this week when Sir Stuart Etherington, chief executive of the National Council for Voluntary Organisations and one of the sector’s most senior figures, used his speech at the NCVO’s annual conference to enter the current controversy about the self-regulation of fundraising.

Etherington focused on the Code of Fundraising Practice, the document that sits at the heart of self-regulation because it is used by the Fundraising Standards Board to adjudicate on complaints. The code is set not by the FRSB, but by the standards committee of the Institute of Fundraising, which is the professional body for fundraisers. Etherington remarked that "the correct regulatory regime is not one that is convenient for those being regulated, but one that adequately balances the interests of the public and the regulated".

He argued that the necessary balance would not be achieved while the IoF was both the champion of fundraisers and the controller of the key component in the self-regulation of fundraisers. The code, he said, could either sit with the FRSB, overseen by a committee of fundraisers and lay members, or remain with the IoF in a new, arm's-length arrangement. He said: "If the code is to remain with the IoF, it must put clear blue water between the standards committee and the rest of the organisation."

Yesterday the charities minister, Rob Wilson, was not so specific as Etherington about structural reform, but said the industry needed to look at  whether the public was properly represented in the setting of standards. He added: "It also needs to look at the bodies themselves and whether they are the best way to self-regulate." He went no further than that somewhat ambiguous position.

Is the argument for structural reform accepted by the fundraising bodies, in particular, and, crucially, by the IoF? The preferred option that emerged from a consultants’ report on the self-regulatory system last year included appointing an independent chair to the IoF standards committee. Twelve months after the report was completed, the IoF recently said it will do that, although no timetable has been announced.

Apart from that, Peter Lewis, chief executive of the IoF, has made it clear he does not share Etherington’s belief that the structures are flawed, or that changing them would in itself address public concerns. He argued this week that the self-regulatory bodies had already responded quickly and strongly to the issues raised in the wake of the death of Olive Cooke, and the standards committee had already committed itself to important revisions of the code.

In his recent letter to Wilson, Lewis said work was in hand to standardise opt-in and opt-out boxes in fundraising materials for data-sharing or future contact, to tighten application of the Telephone Preference Service and to set up a new compliance regime with the help of major charities. The IoF has also announced that the word "ought" will be replaced with the word "must" throughout the code, and has set up four task groups to consider key aspects under the headings of frequency, managing preference, data and telephone practice.

All this is welcome and sensible. But it has to be asked why it has taken the Olive Cooke case to set all this in motion. If the current system of code-setting and self-regulation was adequately responsive to public concerns, would we not have seen at least some of these remedial measures some time ago? Most of the concerns, after all, are not new. They have been bubbling along intermittently, but without amounting to the current eruption that has forced action. An outside observer might be justified in thinking that fundraisers have simply ridden a soft system for as long as the going remained good. Such an interpretation would strengthen the Etherington argument for a change of structure in order to make more likely a proactive rather than a reactive response to future fundraising concerns, which are bound to arise as digital methods change and advance.

Wilson was unequivocal in his speech this week: "Change is essential. You should embrace it and lead it, rather than wait and allow others to do it for you." Ministers have considerable powers they could use without going as far as to introduce a statutory regulatory system (which remains highly unlikely). Overall, it feels very much in the balance whether change without structural reform will be considered sufficient.

An important litmus test will come next week, when the IoF will announce what it has decided about how doorstep fundraisers should act when they encounter ‘no cold calling’ notices. Etherington was clear: "No more of the ‘no-cold-calling stickers don’t apply to charities’ nonsense." Wilson was clear too: "In my opinion, the observance of all ‘no cold calling’ stickers should be immediately observed by charity fundraisers." The fundraising bodies have been doing research on the prevalence of stickers and how many sticker households actually donate. It will be interesting to hear the results and the conclusions drawn from them.

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