There have been several recent cases where Charities have felt compelled to return donations to protect the reputation of the charity and maintain public trust. This is obviously a decision which will not be taken lightly.
As the best interests of each charity differs each will need to consider their own circumstances and the details of the donation and different charities will likely reach different conclusions. It should be noted that the terms of the donation may restrict the return of the donation to the donor and the Charity Commission’s authorisation may be required in certain cases. Trustees should also remember their duty to report any serious incidents which could harm their charity’s reputation to the Commission. We would encourage trustees to have a board policy on donation acceptance to help manage such situations. Ultimately, the Trustees should be able to demonstrate how they reached a decision about the acceptance or return of a donation.
The Institute of Fundraising has issued practical guidance on acceptance, refusal and return of donations, which recommends that charities develop and implement policies for returning and refusing donations, which they may then also choose to make public, to guide and justify their decision-making on this issue. This policy would need to take into account the Charity Commission and Fundraising Regulator’s oversight.
If you have any questions on donations, please do not hesitate to contact one of the charity specialist team at MHA Moore and Smalley.