Magdalena Kuenkel, Consultant at Aleron, has written an article on the importance of reforming the fundraising regulations. Therefore, she analyses the current regulation of Charity Fundraising in the UK.
These last few weeks have seen heated debates among leading politicians and practitioners about the need to reform fundraising regulation. Rob Wilson, Minister for Civil Society, has for example called for the introduction of a single fundraising regulatory body to replace the current “alphabet soup” of the Institute of Fundraising, the Fundraising Standards Board and the Public Fundraising Regulatory Association. At the same time, Baroness Hayter and Lord Watson have suggested making membership of the Fundraising Standards Board mandatory for all charities.

The debate has become a politicised one – losing, at least partly, the necessary focus of what is best for organisations in the sector. To what extent would a single regulatory authority change fundraising practices in charities? To further understand this issue, we have taken a closer look at the role of current regulators in more detail. Our conclusion: the central point is not about the number of regulators aiming to promote accountability and integrity in fundraising; rather, it is a question of finding ways to address good fundraising practices within each organisation’s fundraising strategy.

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Analysing the current regulation of Charity Fundraising in the UK

In the UK, charity fundraising is clearly widespread and varied, with professionals and volunteers employing a wide range of techniques to raise funds for charitable causes. It is estimated that there are around 45,000 fundraising charities in the UK. Together they raise more than £11 billion in voluntary income each year. Regulation of charity fundraising has in recent times been largely driven by the passing of the Charities Act 2006, which prescribed the establishment of a new self-regulatory framework. Today, three key membership organisations are part of this self-regulatory framework and operate on an opt-in scheme for charities and fundraising suppliers. We have summarised details about all three below.

Institute of Fundraising The Institute of Fundraising (IoF) envisions ‘excellent fundraising for a better world’ and aims to create the environment and understanding for fundraisers to excel. The Institute offers a vast range of training courses and qualifications and has become a key body to influence policy making.

It is the largest individual representative body in the voluntary sector with over 5,500 individual and 400 organisational members.

Fundraising Standards Board The FRSB is an independent self-regulator for fundraising in the UK. It provides support to charities by helping them to comply with fundraising best practice, offering training opportunities and supporting them in handling complaints. The FRSB “tick” logo has become an indicator for charity accountability.

It has more than 1,858 members.

Public Fundraising Regulatory Association The smallest of the three regulators is a charity-led self-regulatory membership body for all types of face-to-face fundraising (F2F). This refers to the personal solicitation (almost always by a professional fundraiser) of a regular charity donation via a direct debit. PFRA has as dual role as a regulator in being the bridge between councils and charities practising F2F: maintaining professional standards and ensuring fair allocation of fundraising on the ground. It has c. 165 members.
How does membership affect fundraising practice?

All three bodies report increasing membership numbers in recent years. Charities and fundraising organisations join in order to develop skills and access training resources as well as receiving an external approval of fundraising techniques. Even more important than that is the commitment of a charity to abide by the relevant Code of Fundraising Practices. These practices (Hyperlink: http://www.institute-of-fundraising.org.uk/guidance/code-of-fundraising-practice/) have been developed to allay the public’s concerns about the sector in general and to promote a high level of accountability in fundraising.

Without doubt, these benefits provide a framework of operation for charities and offer valuable training and development opportunities. However, we wish to highlight the simple but often overlooked fact that organisational membership is neither a guarantee for good practice nor for a successful fundraising strategy. In our experience, good fundraising practice is much more dependent on a coherent, staff-owned and clearly defined fundraising strategy that addresses all potential challenges in its development. The themes of accountability and integrity, which dominate regulatory concern, lie at the heart of such a strategy, through the continual interrogation of its key elements. Such an approach is outlined briefly in Figure 1. below:

To sum up, we are convinced that the debate about fundraising regulation should move away from the quantitative assessment of how many regulators the UK should have and whether membership of such bodies should be compulsory. We believe that fundraising integrity and accountability has to be grounded in each charities’ fundraising strategy – an issue that needs to be addressed not by politicians, but by charity executives and fundraising directors. After all, given the fact that fewer than 20% of all UK charities are currently registered members with at least one of the three fundraising membership organisations shows that the debate is more of politics than substance.