With many charities under financial pressure it can be tempting to accept funds without sufficient consideration of the source of those funds. Such an approach can backfire when it later comes to light that such funds have been raised in a manner incompatible with charitable giving, with the potential for considerable reputational damage.
For charities that are reliant on donations to support their charitable giving, including legacies, we recommend that they put in place a gift acceptance policy that provides clarity over the circumstances when donations will be refused, rejected or returned to the donor.
Such a policy would include:
- the principles that should guide the charity’s decision making process when deciding whether to accept a donation or not
- what due diligence steps the charity will take to verify the source of any donation
- the requirement to keep written records of the decisions reached
- the media response to be followed ensuring that the charity’s decision making processes are presented positively if called into question