New inquiry into the use of sub-contractors by fundraising agencies in the UK

The Fundraising Regulator has announced the launch of its first market inquiry which looks into issues with the use of sub-contractors in charity fundraising. The inquiry is being led by Jim Tebbett, the Regulator's new Head of Proactive Regulation and Projects. It will include fact-finding, sector engagement, and meetings with stakeholders (including other regulators and sector bodies) - with the aim of ensuring compliance with the Code of Fundraising Practice.  

The inquiry was launched after reports were made of third-party fundraisers using tactics to put pressure on donors.  In a blog post, Paul Winyard, the Regulator's Head of Policy wrote: ''there is mounting evidence that some companies – operating as sub-contractors – are using fundraisers who are insufficiently trained and motivated by commission-based payment structures.  This has resulted in high-pressure sales tactics that may well breach the Code of Fundraising Practice and threaten to undermine public trust and confidence in the sector.''

Lord Toby Harris, the Chair of the Fundraising Regulator, also said: 

''We are committed to working with the sector to understand how best to monitor and regulate the use of subcontracting.  Our aim continues to be helping charities and fundraising agencies comply with the Code and fundraise responsibly, so the public has confidence and trust in the sector and charitable work can thrive.'' 

The standards which apply to all fundraising are set out in the Fundraising Code. Section 7 of the Code provides guidelines on monitoring relationships effectively, including:

• Carrying out appropriate checks on fundraisers and commercial partners
• Giving full details of perceived or actual conflicts of interest that charities or fundraisers and commercial partners are aware of
• Having a written agreement in place with any third-party fundraiser or commercial partner the charity works with to fundraise
• Ensuring that any paid third-party fundraisers or commercial partners the charity works with comply with the Code
• Making all reasonable efforts to monitor whether the paid third-party fundraisers or commercial partners are keeping to the agreement the charity has with them (including the conditions of the contract which relate to compliance with the Code)
• Choosing a named person with lead responsibility for monitoring that the requirements of the law are being met
• Setting out a clear procedure for handling complaints and feedback and
• Agreeing an action plan with the other organisation to deal with concerns identified.

For more information about fundraising obligations and in particular the information which should be included in fundraising agreements, please see here. 

Charities should monitor closely the activities of those carrying out fundraising on their behalf.  It is important to remember that breaches of the Code by fundraising sub-contractors and commercial partners may be considered breaches by the charity itself. 

The Fundraising Regulator is also currently consulting on the Code of Fundraising Practice itself, with the current consultation period open until 1 December.