Charity Fundraising Governance: Does Your Charity Need a Fundraising Policy?

Charity Fundraising Governance: Does Your Charity Need a Fundraising Policy?

Fundraising is essential for many charities. Donations, grants, events, corporate partnerships, online giving and community fundraising can all help a charity continue its work.

But fundraising is not just about raising money. It also needs proper governance.

Trustees remain responsible for how their charity fundraises, even where the work is carried out by staff, volunteers, professional fundraisers, commercial partners, online platforms or other third parties. This means fundraising should be planned, documented, monitored and reviewed at the right level.

Following the Charity Commission’s updated CC20 guidance, many charities may now be asking:

• Do we need a charity fundraising policy?
• Do we have a clear fundraising plan?
• Are restricted donations and appeal wording being managed properly?
• Do we have the right controls for donor data, Gift Aid, cash donations and suspicious donations?
• Are our third party fundraising arrangements properly documented?
• Are fundraising risks, complaints and performance being reported to trustees?
• If these questions have not been discussed recently, it may be time to review your charity fundraising governance.
• What is charity fundraising governance?

Charity fundraising governance is the way your charity plans, controls and oversees its fundraising activity.

It does not need to mean complicated paperwork. For many smaller charities, a simple fundraising policy, a clear fundraising plan and a trustee reporting process may be enough.

The key point is that fundraising should not be left to chance.

Good fundraising governance helps charities show that:

1. trustees understand their responsibilities;
2. fundraising activity supports the charity’s purposes;
3. funds are used properly;
4. donor communications are clear;
5. restricted funds are identified and recorded;
6. fundraising risks are reviewed;
7. third party fundraisers and commercial partners are checked;
8. complaints and incidents are reported appropriately;
9. the charity can evidence its decision making.

This is particularly important where fundraising involves public donations, restricted appeals, vulnerable people, online platforms, corporate partners, professional fundraisers or significant sums of money.

Does every charity need a fundraising policy?

Not every charity will already have a document called a Fundraising Policy.

Larger charities may have detailed fundraising policies, procedures and reporting systems. Smaller charities may have some processes in place, but these may be spread across trustee minutes, finance procedures, risk registers, volunteer guidance, appeal wording, Gift Aid records and complaints policies.

The issue is not always whether a charity has one document with the right title.
The better question is:

Can your charity show how fundraising is planned, approved, monitored and reported?

A charity fundraising policy can help bring those processes together. It can explain who is responsible for fundraising, how trustees oversee it, how funds are handled, how risks are managed and how fundraising issues are escalated.

A charity fundraising governance pack can go further by giving trustees and senior managers practical tools, such as a fundraising plan template, risk register, restricted appeal checklist, donation acceptance checklist and trustee reporting template.

Why is CC20 relevant?

The Charity Commission’s CC20 guidance is a guide to trustee duties in relation to charity fundraising. It reminds trustees that fundraising is part of their wider responsibility to act in the charity’s best interests, manage resources responsibly and ensure the charity is open and accountable.

The updated guidance encourages trustees to think practically about how fundraising is planned and controlled.

This includes areas such as:

1. complying with fundraising law and the Code of Fundraising Practice;
2. planning fundraising effectively;
3. delegating fundraising responsibly;
4. using clear fundraising materials;
5. working with professional fundraisers and commercial participators;
6. protecting charity funds;
7. keeping appropriate donor and appeal records;
8. handling fundraising complaints;
9. making accurate Trustees’ Annual Report disclosures where required.

For charities, this does not necessarily mean creating lots of new documents. But it does mean making sure fundraising governance is documented clearly enough for trustees, senior managers and fundraising leads to understand what should happen.

Key areas your charity should review

1. Fundraising plans

A fundraising plan does not need to be complicated. It should usually explain how the charity intends to raise funds, what fundraising methods will be used, what the targets are, what the costs may be, who is responsible and how risks will be monitored.

A fundraising plan template for charities can help trustees and senior managers document these points in a practical way.

2. Restricted appeals and appeal wording

Appeal wording is an area where charities need to be careful.

If a charity raises money for a specific project, item, location, activity or purpose, it may create a restricted fund. This means the money must be used for that purpose unless the charity has a proper legal basis to use it differently.

Before launching a specific fundraising appeal, charities should consider what will happen if they raise too much, raise too little, cannot proceed with the project or need to change their plans.

A restricted appeal wording checklist can help charities review these points before publishing donation pages, social media posts, campaign materials or fundraising emails.

3. Donation handling and donor records

Charities should also think about how donations are recorded, handled and protected.

This may include donor names and contact details, donation amounts, payment methods, Gift Aid declarations, appeal materials, donor restrictions and correspondence about how donations should be used.

Good records help charities manage restricted funds, respond to donor queries, evidence Gift Aid claims and explain how funds have been used.

4. Suspicious donations and fundraising fraud

Fundraising can carry fraud and reputational risks.

Charities should have a process for dealing with suspicious donations, unusual conditions, anonymous donations, unexpected high value donations, fundraising fraud and misuse of the charity’s name.

A donation acceptance and refusal checklist can help trustees and senior managers decide whether a donation should be accepted, refused, returned or escalated for further advice.

5. Third party fundraisers and commercial partners

Many charities work with others to fundraise. This may include professional fundraisers, fundraising consultants, agencies, corporate partners, online platforms, influencers, commercial participators or trading subsidiaries

Before working with third parties, charities should carry out proportionate due diligence. They should consider who the third party is, how they will fundraise, whether they will handle donations, whether donor data will be shared, how much the charity will receive and whether written terms are needed.

Where appropriate, charities should have written agreements in place before fundraising starts.

6. Fundraising materials and use of AI

Fundraising materials should be accurate, clear and not misleading.
This applies to appeal pages, leaflets, scripts, videos, email campaigns, sponsorship forms and social media posts.

If a charity uses AI tools to help create fundraising content, it should still check the final wording carefully. Trustees and senior managers should consider accuracy, permissions, confidentiality, personal data, use of images, beneficiary stories, safeguarding and reputational risk.

7. Fundraising complaints and trustee reporting

Fundraising complaints, risks, incidents and performance should be reported to trustees at appropriate intervals.

A trustee fundraising report template can help charities record income against target, fundraising costs, restricted funds, complaints, fraud concerns, donor data issues, third party fundraiser issues and decisions required from trustees.

This helps trustees evidence that they are actively overseeing fundraising, rather than only becoming involved when something has gone wrong.

How our Charity Fundraising Governance Policy and Review Pack can help

We have created a Charity Fundraising Governance Policy and Review Pack to help charities in England and Wales review and document their fundraising governance.

The pack includes:

• Fundraising Governance Policy;
• Guidance Notes;
• Fundraising Governance Audit Checklist;
• Trustee Board Discussion Checklist;
• Fundraising Plan Template;
• Fundraising Risk Register;
• Restricted Appeal Wording Checklist;
• Donation Acceptance and Refusal Checklist;
• Third Party Fundraiser and Commercial Partner Due Diligence Checklist;
• Fundraising Complaints Log;
• Trustee Fundraising Report Template.

The pack is designed for charities that want practical documents they can adapt to their own structure, fundraising methods and risk profile.

It may be particularly useful if your charity does not currently have a fundraising policy, has informal fundraising processes, is planning new fundraising campaigns, works with volunteers or third parties, runs restricted appeals or wants a clearer board reporting process.

Final thoughts

Fundraising plays a vital role in the charity sector, but it also carries legal, financial and reputational responsibilities.

For many charities, the next step does not need to be a complicated new system. It may simply be a case of reviewing what is already in place, identifying any gaps and making sure trustees have the right documents and information to oversee fundraising properly.

A clear charity fundraising policy and practical fundraising governance templates can help trustees and senior managers protect public trust, manage risks and ensure funds are used in the right way.

View our Charity Fundraising Governance Policy and Review Pack here:

https://kkbservices.com/the-legal-store/policies/fundraising-governance-policy-and-review-pack-for-charities/