All change in fundraising – what should trustees do now?

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All change in fundraising – what should trustees do now?

How should charity trustees and treasurers respond to the new fundraising regulations, and do they need to change the way they interact with fundraising teams? Here are some of the key practical considerations to come out of the Honorary Treasurers Forum’s Summer Symposium

By Denise Fellows


Set to launch next year, the new Fundraising Preference Service will give consumers the ability to choose to opt out of communications with charities. This has important implications for charity trustees and treasurers. Indeed, it was the main subject of discussion at the recent Summer Symposium for the Honorary Treasurers Forum, where speakers Stephen Dunmore, chief executive of the Fundraising Regulator and Ed Aspel, executive director of fundraising and marketing at Cancer Research, gave their views on the current status, and how to handle the impending changes.


Ethical values “going missing” from the sector


They said that over the past 10 to 12 years, some charities have engaged in “industrial style” fundraising, and some of the ethical values expected from the sector were “going missing”.

Stephen stressed that the new Fundraising Regulator’s role isn’t about "more regulation – but improved, better and more engaged regulation."


He also discussed the Fundraising Preference Service (FPS) due to launch in 2017, which has caused the most debate and opinion in the fundraising sector, and caused anxiety and concern for many organisations over how they can make it work.


Certainly the FPS will present some big challenges for fundraisers. Whereas members of the public can currently register with the Telephone Preference Service (TPS) and the Mail Preference Service (MPS) to make their phone or postal contact preferences clear to organisations, this new service provides more options to enable consumers to "hit the reset button" and opt out of all communications they receive from charities.


What we can learn from Cancer Research UK’s response


Rather than waiting for new legislation to hit, Cancer Research UK has taken a bold and proactive approach to evolving its fundraising practices. Its experience provides some interesting learnings for trustees.


Following the Etherington Review, the charity announced it would introduce an opt-in-only policy for fundraising communications. Its rationale was that, as opt-in was potentially being enforced anyway, it might as well start talking to donors now.


One of the first things the charity did was inspect its data, and then analyse the potential financial impact of losing donors through an opt-in policy over a five-year period.


Ed Aspel said that the initial reaction from the fundraising teams was “real panic”. However, they quickly realised that having fewer supporters would significantly reduce marketing costs, while the bottom line losses wouldn’t be nearly as big as they thought. The feared negative impact was also reduced as a high level of email addresses of supporters were obtained through individual donor pages from donors who had already opted in.


A new way of thinking


Ed also spoke about the potential of new opportunities ahead. He asked whether, when approaching the opt-in issue, charities are just looking at the worst case scenario. Instead, could they be thinking that this could be a real opportunity for a new way of thinking, to better understand how to get people engaged with the charity and to think about what kind of communication is need to make them opt in?


He explained that attitudes towards donors at the charity changed radically and very quickly. CRUK has 10-12 million supporters on its database and, as part of its marketing strategy, the charity telephones people once or twice a year to ask them if they would like to increase their direct debits. They started using these conversations as an opportunity to ask supporters to opt in. They found that 40-50% of supporters opted in – substantially more than the 20% they had anticipated.


Cancer Research UK’s theory is that if charities are contacting their supporters regularly to ask them about donations, why not ask them at the same time to opt in? It doesn’t mean necessarily that a huge increase in work is needed. Ed said that he appreciates that the process might be more complex for some charities, however, moving to an opt-in strategy could be viewed as protecting long-term trust and income.


What are the key considerations now?


Both speakers raised some key questions for trustees to consider, including:


1. As trustees, are you fully in the picture about your current fundraising practices and any agencies your charity uses?

2. What is the risk to your charity of not reviewing your current fundraising practices and taking an opt-in approach?

3. What’s the cost to the organisation of loss of trust and what will they do to rebuild trust?

4. What’s the worst-case impact of doing nothing?

5. Have you looked at a financial model that include the costs of moving to an opt-in fundraising strategy?

6. Is the board working closely with fundraisers to ensure they are aligned on strategy?

7. Have you considered there may be marketing cost savings to be made through not contacting or sending materials to uninterested people?

8. Will you consider a communication strategy to engage new and existing donors?

9. Have you reviewed calculations in your financial model?


They pointed out also that this is unchartered territory for charities – so naturally, it will be a case of trial and error.


Stephen Dunmore concluded that one of the biggest hurdles for charities is the public’s lack of trust in charities, and how to put that right. But he added that this problem has been created by the sector, and it is down to the sector to put it right.


A framework for success


Graham Spooner, who is a trustee of the Honorary Treasurers Forum, said: “As a treasurer, I have worked closely with fundraisers, especially in building relationships with major donors and corporate partners. I have adopted what I call a “5 ‘C’s approach to develop a framework for success:


* Credibility – of both the cause and the charity

* Common Ground – establishing an empathy based on understanding

* Compelling reason(s) – the difference their involvement and support will make

* Commitment – both financial and personal

* Confidence – to do all the above.”


It is clear is that fundraising practices must evolve, charities need to respond and trustees and treasurers have an important role to play in this response. Rather than sitting and waiting for the inevitable, surely this is the time for charities to be proactive and bold and engage existing and future supporters?


Denise Fellows (@Denisefe) is chief executive of the Honorary Treasurers Forum, a charity providing support and networking for treasurers. She is also a senior visiting fellow at Cass CCE where until recently she headed up the Consultancy and Leadership Development practice.


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