Transparency means not being defensive, says Kate Sayer

Details of pay, fundraising, campaigning and reserves should all be on your website, she argues

Kate Sayer
Kate Sayer

With so much negative press, charities need to consider how they can get back on the front foot. However irritating some of the recent coverage has been, it is important not to sound defensive. People might genuinely be interested in your charity, but a little worried about how charities operate. You cannot necessarily expect people with little knowledge of the sector to understand how charities are funded or how they pay their staff, so it’s worth stepping into the shoes of a complete stranger and looking at your charity from their perspective. What questions might they ask?

A likely area of interest is your source of funds. Members of the general public do not necessarily know that many charities do not ask for donations and they won’t understand jargon such as "commissioned services". Explain in simple language where you get your funds from. If you do raise funds publicly, explain how you go about it.

Put a code of ethical fundraising practice on your website. It is now relevant to state what you do not do as well as what you do. If you do buy in lists for marketing, then say so, but explain why you do it. Don’t hide the truth because you will make things worse if someone sees your statement and knows it to be untrue. Internal stakeholders such as staff and volunteers can become cynical about values statements if they do not match the reality. This is also a big risk to your reputation, because it is easy for a disgruntled staff member to take to social media to air their views.

Similarly, if your charity does advocacy or campaigning, people might want to know where you get your money from. Many campaigning charities do have a clear policy and will not accept funds from government bodies or companies. It’s good to say this sort of thing loud and clear on your website, where most people will look if they are interested. 

The other area of obvious interest is salaries. There tends to be a lot of focus on senior executive pay, but this is not necessarily the most important issue. Larger fundraising charities are mostly being more open about this and we can expect many of them to put information on their website. The National Council for Voluntary Organisations report recommended that this should be no more than two clicks from the home page, but the priority should be to get the content right. Care is needed: if it looks as if you are trying to conceal something, people will actually assume things are much worse than they actually are. It might be simpler to state salary levels, even if you do not give names and you quote a range. You need a coherent remuneration policy, which should explain any benchmarking and rationale for staff salaries. Don’t forget that surveys have shown that many members of the public are surprised that charities pay any salaries at all. Your policy should address staff pay at the bottom of the scale as well and what you are doing about the national living wage.

If you have funds in reserve, think about how that looks to an external reader. A donor gives to a charity because they think they need the money to spend, not to stash in reserves. The rationale for holding funds in reserve needs to be clear and simple. Usually, this is buried away in the annual report, but you could write a plain-English version for publication on the website. And if you invest those funds, think about publishing an ethical investment policy if that is relevant to your cause and your stakeholders.

Managing reputational risk is not just about reacting to negative press stories. Your reputation is the perception others have of you and your organisation.

Charities enjoy high levels of trust and confidence, but that means the public expects higher standards from charities. In order to win support, charities appeal to values about helping those in need, so they need to operate in a way that is consistent with those values. Fundraising frequently uses the "commitment and consistency" technique. For example, a fundraising call or letter will ask the prospect "Do you care about children dying in Syria?" Once the prospect has committed to the principle of caring, it is then easy to ask them to act in a way that is consistent with that – in other words, to donate. The principle operates in reverse, too. The donating public need to see consistency between what we say and what we do. It is not simply a "nice to have" – it is fundamental.

Kate Sayer is a partner in Sayer Vincent, auditors and advisers to charities

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