This November we’re taking a deep dive into gift acceptance and due diligence. We’ve already explored the broad principles your gift acceptance policy should cover, so in this article, our CEO, Kerry Rock, looks at what you need to consider for your specific policy.
When putting together a gift acceptance policy for your organisation, you need to incorporate the types of donations and relationships it will cover. This usually includes gifts from:
- Individuals
- Trusts and foundations
- Companies
- Legacies
- Government/agencies
- The UK and international donations
Depending on your organisation, you could include donations, partnerships and commercial arrangements and there might be other types of sponsorship you want to add.
The Chartered Institute of Fundraising’s guidance is really helpful and covers some of the questions you should ask yourself when putting your policy together.
- Are there specific industries or activities that are not aligned with your charitable objectives? Often quoted is the health charity that won’t accept gifts from alcohol or tobacco companies because it’s not aligned with their objectives.
- What types of donations will the policy apply to? Such as gifts-in-kind, pro-bono work, or sponsorships. This incorporates not just donations but all the other ways you could get support.
- Does your policy apply in all circumstances? Do you have exactly the same policy and processes in place for people responding to a disaster appeal vs regular giving?
- What is the right threshold value for your gifts for the policy to apply? Different levels of due diligence can be undertaken for different levels or types of gifts. For example, you might have a quick process for a £10,000 gift but a much more detailed piece of research might need to be carried out for a £100,000 gift. Having those triggers is really important because it helps your team know their role in your gift acceptance policy.
- Are there specific countries which have underlying issues around bribery and corruption that should automatically trigger an assessment?
- Are there a lot of restrictions on how the money can be used, on who the beneficiaries must be or on the project being carried out in a particular way? You need to understand what the cost of accepting the donation is going to be, especially with restricted gifts. A gift with a lot of stipulations may mean it costs more to deliver the project than the donation is actually covering.
The Chartered Institute of Fundraising’s guidance also encourages you to consider the following:
- What degree of separation needs to exist between your donors and their associations? I refer to this as how far down the food chain you need to go – if you receive a gift from a donor whose sibling has questionable business practices is that ok or something that will impact whether or not you accept the gift?
- The impact of anonymous donations – there’s a difference between anonymous donations and people who don’t want public recognition. For example, if a donor you know gives £25,000 but doesn’t want to be named publicly it’s very different to a donation of £25,000 that you don’t know the source of. An anonymous donation of £25,000 and above needs to be reported to the Charity Commission.
- How do you identify donors that might be vulnerable?
- Can the donor appeal it if you won’t accept their donation? What level of staff input will you have into gift acceptance decisions?
- And finally, should you publish your gift acceptance policy or not?
Other factors to take into account:
- Educational institutions need to think about the relationship between their students and close relatives – if close relatives are donating at what point does it trigger issues around whether is it influencing the acceptance of students or their grades?
- Recognition and naming rights – this is often part of capital campaigns but is something you need if you’re running major gift programmes. If people start asking for things, you need to be ready for those questions.
- You should also incorporate the elements of your written gift agreement into your basic policy.
At Prospecting for Gold, we have over 25 years of experience helping charities and non-profits meet their fundraising goals. If you have a question about corporate fundraising, email info@prospectingforgold.co.uk and we’ll happily help.