People raise concerns with the ACNC, as the national charities regulator, about charity fundraising. Concerns are often about the tactics used by fundraisers and marketers working for charities. We also get questions about how much money charities can spend on fundraising and other activities.
agencies that regulate fundraising), but we can take action in certain situations.The ACNC is not a national fundraising regulator (there are many
How can charities raise funds?
If a charity complies with relevant fundraising or other regulatory requirements, it can raise funds in any way it chooses.
Charities often raise funds through:
- membership fees
- grants from grant-making bodies and funders (such as government agencies and philanthropic trusts and foundations)
- corporate sponsorship or partnerships
- fee-for-service work
- public donations (such as through door knock appeals, or street collections)
- public events with admission fees
- fundraising events (sometimes in partnership with others, such as a fun run or gala dinner)
- raffles (or other games such as bingo), or
- running opportunity shops or selling items (such as merchandise or having a bake sale).
In an ever-changing environment, charities – like all enterprises – may need to look at generating multiple streams of income to ensure their sustainability. Newer approaches to raise funds, can include social investment (social or environmental impact) or social impact bonds, community funding (crowdsourcing) and micro-financing, and campaigns through social media and digital tools.
Charities need to ensure they retain their not-for-profit status and that their fundraising goes towards furthering their charitable purpose, particularly if there is a commercial element involved.
Charities must comply with any relevant fundraising laws in the state or territory they raise funds in, not just where they operate.
Can charities spend money on fundraising activity?
Yes. It is legitimate for a charity to spend money to raise money (that is, incurring expenses while undertaking fundraising activities), as long as this is in line with its charitable purpose. Decisions about how a charity will raise and use funds are made by the charity’s governing body.
Why do charities use commercial fundraising firms?
Sometimes charities outsource fundraising to external agencies, or they may rely on volunteer fundraisers. Because of the resources involved in large-scale fundraising, it may be appropriate and cost-effective for a charity to outsource this work, especially for larger charities.
However, there have been examples of commercial fundraisers using questionable tactics to get donors to commit to regular ongoing donations, which can seriously affect public goodwill and the charity’s reputation.
Who is responsible for a charity’s fundraising?
Ultimately, a charity’s board, committee of management or trustees (its ‘governing body’) has responsibility for fundraising activity, whether it is outsourced or not. The board has the overall responsibility for the charity’s actions. Board members must have a clear understanding of how money is raised, including any fundraising operations, and they must ensure there are appropriate and lawful processes in place to manage any money raised.
They must ensure that the charity generates funds in a way that is in the charity’s best interests. This includes considering the charity’s charitable purpose, its beneficiaries and the impact on the public and other potential donors. For example, information collected from donors must be appropriately stored and used in ways that comply with relevant privacy laws. Some boards choose to adopt fundraising policies, or codes of conduct, like those developed by the Fundraising Institute of Australia.
No matter how charity funds are raised, the board must ensure that the money, less reasonable expenses, is put towards pursuing the charity’s charitable purpose. Read more about the duties of board members.
Statements about charity fundraising and what donations are used for
Charities should ensure they are not misleading the public in relation to their administration costs and fundraising.
This includes statements regarding the use or destination of contributions as well as the need for donations.
For example, a charity should not solicit donations with a statement that ‘100% of contributions will benefit those in need’ if, in fact, a portion of donations will go towards the administrative costs of the charity.
Charities should also not be misleading when referring to studies or statistics to support the need for donations. For example, a charity should ensure there is a reasonable basis for any statistics quoted or research referred to for the purposes of soliciting donations.
Charities should also be transparent in relation to their fundraising arrangements, particularly where this impacts where contributions end up.
If charities make false or misleading statements – or act in a way that creates a false or misleading impression –they may contravene the Australian Consumer Law. This, in turn, may be a breach of the ACNC Governance Standards.
What action can I take if I am receiving unwanted calls, emails or letters from a charity?
Contact the charity using the details on its website, or details on the ACNC Charity Register, rather than telling the caller or charity collector on the street. This will make sure the charity itself gets the message directly. Ask the charity directly to have your details removed from its mailing and contact lists.
As part of the request to be removed, include:
- the name of the person who wants to be removed from the charity’s list
- the phone number being called or location that an approach was made (residential or on the street)
- the postal or email address if the approach was made by mail or email
- the number of times contact has been made.
Also, find out if the charity is a member of the Fundraising Institute of Australia (FIA). Members of the FIA must meet fundraising standards and principles, and the Institute can investigate complaints about its members.
What should I do if a charity fundraiser approaches me on the street?
The decision to donate is always yours. If you do not wish to donate, you do not have to and you should not be made to feel obligated to donate. You can communicate this to the fundraiser. Fundraisers can use a variety of tactics to appeal to you and encourage you to donate, but it is always your right to politely decline. If you feel uncomfortable saying no on the spot, you can say that you will do your own research and donate another time.
If you feel harassed, consider contacting the charity directly to let them know.
I’m on the Do Not Call Register – why do I keep getting calls from charities?
Charities are exempt under the law from the Do Not Call Register. This exemption means they can call people even if they are listed on the Register. However, reputations are important for charities and if you have concerns about any calls you are receiving, you should raise them directly with the charity. It may be able to remove you from any contact lists that it uses.
What if I don’t like a charity’s fundraising advertising?
If you are offended by a charity’s campaign messaging, or are otherwise concerned about it, it is best to speak to the charity directly about it. You can also contact the Australian Communications and Media Authority at www.acma.gov.au, or the Advertising Standards Bureau (voluntary standards).
What if I am concerned about the privacy of my information?
If you are worried about how a charity is handling your personal information, we recommend speaking directly to the charity. Charities should have policies in place to ensure personal information is managed in accordance with the applicable privacy law obligations, this includes storing information securely.
If you are not satisfied with the charity’s response to your concern, you may be able to lodge a complaint with the Office of the Australian Information Commissioner (the OAIC). Please note that a charity may be subject to both state and federal privacy laws, and the OAIC may only investigate complaints about the federal Privacy Act 1988 (Cth). Information about other privacy jurisdictions can also be found on the OAIC website.
What can the ACNC do if I am unhappy with a charity’s fundraising?
The ACNC does not have responsibility for fundraising regulation (this is generally regulated by state and territory agencies).
Which state or territory agency do I need to contact about a charity’s fundraising?
If your charity undertakes fundraising activities, it needs to comply with the fundraising legislation of the states or territories it raises funds in.
Generally, charities need to register to undertake fundraising activities and may need a permit or licence. They may also need to provide a report on any funds raised to the state or territory government regulator. In some states and territories, special arrangements apply to charities that undertake fundraising through gaming activities such as raffles or bingo. See our list of regulators that may affect charities at acnc.gov.au/regulatorlist.
When will the ACNC intervene?
The ACNC has investigation powers and will be particularly concerned where it is alleged that a charity has not met its obligations to the ACNC, for example it has failed to keep or provide required information (including financial information), or failed to meet the governance standards.
We require charities to comply with a set of Governance Standards (which cover things such as working towards charitable purposes, being accountable to members and making sure board members are aware of their financial and other duties to their charity). A charity that conducts fundraising through related parties (such as through an entity associated with board or committee members) may be at risk of breaching Governance Standards.
If the ACNC detects fundraising issues, such as abnormally high fundraising costs, we may look into the matter. The ACNC will assess the level of risk to
- a charity's compliance with ACNC Governance Standards or other obligations,
- to loss of public trust and confidence in the charity, or in the sector more broadly, and
- loss of confidence among donors
when deciding what action to take.
Fundraising issues that may trigger ACNC intervention (possibly in collaboration with another Australian regulator) are:
- failure to protect and account for all funds raised
- weak governance oversight of the charity’s activities or resources
- commercial participation or professional fundraising arrangements which do not comply with the law and which cannot be shown to be in the charity’s best interests
- damage to public trust and confidence caused by
- the charity’s fundraising activities
- high fundraising costs
- serious risks to a charity’s reputation or assets
- methods of fundraising which would be a breach of the governance standards
- where conflicts of interest and private benefit have not been properly controlled
- serious or frequent failures in the conduct of fundraising (for example, persistent unlicensed fundraising or failure to provide required information) which put charity funds at risk, and
- criminality which exposes related concerns about misconduct and mismanagement in the administration of a charity - for example fraud, theft, false accounting, tax fraud or failing to obtain legal authority to fundraise.
If there are allegations of fraud or other criminal behaviour these should be referred to the relevant police force. If there are allegations of breach of state or territory fundraising laws, these should be referred to the relevant state or territory regulator.
If you are concerned about a charity’s financial management, including how much is spent on fundraising activity you may be able to raise a concern with the ACNC.
Has the charity met Australian Taxation Office (ATO) requirements?
If the charity is endorsed by the ATO as a deductible gift recipient (DGR), then it will also have requirements it must meet for the ATO. Refer to the ATO's website for more information.