28 February 2018
In the wake of the recent scandal involving the Presidents Club Charitable Trust, which saw an FT investigation reveal that hostesses at the Trust’s Annual Fundraising Dinner event were sexually harassed and propositioned, the Charity Commission have issued guidance to charities who have received donations from the Trust and are unsure about what to do with these donations.
Even if your charity has never benefited from the Presidents Club, the scandal highlights the need for all charities to have clear policies when it comes to accepting donations, particularly in instances where there is uncertainty as to how reputable the donor is.
The Charity Commission guidance reads as follows:
“Accepting or refusing future donations
It is up to a charity’s trustees to make the difficult decision as to whether they should refuse or return a donation. They must make this decision on the basis of the best interests of the charity. That will include weighing up any issues around how the funds were raised, which may include reputational concerns, against the financial impact on the charity of turning the donation down.
Different charities may legitimately come to different decisions, and trustees can approach the Commission for advice if they are unsure about their approach.
Keeping or returning donations already accepted
As with accepting or refusing future donations, when deciding whether to keep or return donations that have already been accepted, trustees should think carefully about, and be able to demonstrate, what is in the best interest of their charities.
Depending on the terms of the donations and how the funds were raised, there may be restrictions on whether a donation can be returned and the Commission may need to authorise such returns.”
Trustees should remember their duty to report any serious incidents which could harm their charity’s reputation to the Commission. We encourage all trustees to consult extensively before deciding to return funds that could otherwise be used productively to provide charitable benefits.
If you would like to discuss this or any other matter affecting your charity, please contact me or your local UHY charity adviser. Alternatively, if you would like to read more charity focused blogs please click here.