We define philanthropy as the giving of resources in an engaged and strategic way for maximum impact and in a tax efficient manner. It can include the giving of money, assets, time, talent, voice and one’s social capital. We believe in the power of philanthropy as a great social connector and the source of many great opportunities.

City Philanthropy

A Wealth of Opportunity

Thinking of giving to charity? Great – just don’t forget these 5 important questions

Jun 21st 2016

Emma Turner, Barclay wealth's Head of Client Philanthropy, Wealth and Investment Management, writes for City Philanthropy on how to become a 'smart giver' and the crucial questions donors should ask charities.

Charitable giving should be simple. You choose a charity, decide how you would like to donate and they put your money to good use. It would be nice if it were so straightforward, but there are an increasing number of issues to consider, from how well the charity will use your money, to their governance and how they will use your data. Charitable giving is becoming an increasingly complex gesture of goodwill, and it’s important that you think about these issues before you make a donation.  

Thankfully, this doesn’t seem to be holding people back from giving in the UK, where people continue to be generous to a very wide range of charities and causes. However, against a backdrop of reports media reports of poor fundraising practice from charities, such as persistent and repeated telephone contact with individuals, ‘chugging’, and door-stepping, this delicate relationship is at risk of being disrupted. It’s no wonder that we are increasingly being asked by our high net worth clients for more information about the questions they should be asking when they give to charity.

The UK’s charities are heavily reliant upon individual donations, and so it is imperative that these do not drop off. In response to our clients’ questions and to help more people feel confident with giving to charity, we have launched the Smart Guide to Donating’ – a guide to help anyone who is considering donating more than £100 (or fundraising more than £100 which will be given as a donation) to charity, to become informed givers.

Below are my ‘top tips’ of things to consider when making a charitable donation. Consider the analogy of buying a second hand car– in this case you would be unlikely to buy without knowing a few very important things. You might for example, check on the DVLA site that it was registered there and not stolen, and that it had a valid MOT. Giving to charity should be just the same.

Have you looked beyond the emotional appeal of the charity’s communication?

Remember that most campaigns asking for funds from individuals will involve some form of emotional appeal – one that may prompt a reaction in you because of your personal experience or your interest in the cause in question. It’s important not to operate solely on a blind faith basis however. Instead, before you decide whether to give and how much, consider finding out a little more information about the charity, and think coolly about what you’d like to know about them and their activities. For example, how will your money be spent? Does the charity publish details of its funding and how it is applied? Is it well run (what might demonstrate that)? Does it have good financial management? Can they show their funders (and others) what impact they are having?

What is the ‘right’ charity for you and your area of interest?
If you know which charitable cause you wish to support, then consider which charity working to support that cause best matches your own giving objectives. This may mean not simply responding or giving to the first one that approaches you. Also, don’t assume that all charities achieve the same level of impact. Look for evidence of positive change demonstrated by a charity.

Do you understand the charity’s purpose?
If you look at the charity’s website, is the charity’s mission and purpose clearly communicated? Does the charity have an established ‘theory of change’ – that is, can it describe how it intends to achieve its purpose? And does that purpose mesh with your own interest in giving? Look for evidence of the charity monitoring its impact consistently and regularly, and being able to demonstrate that to others.

If you are giving larger sums, have you looked at the charity’s finances?
Financial management is important to consider for any charitable donation, but imperative when giving a large amount. You need to ask: Are their financial accounts lodged with the Charity Commission and up to date? Is their fundraising achieving growth year on year? Do they have diversified sources of funding (i.e. a lack of dependence on one or two funders)? Do they have reserves that could cover their operations for 6 months or so if they hit a problem with fund-raising or income? But not such vast reserves that it would put people off from giving them money?

Is the personal data you are sharing protected?
For many people, mismanagement of personal data is enough to put them off giving to a charity, so make sure you do your homework to check out your chosen charity’s policy on data protection. For instance, does the charity have a policy of allowing you to opt out of receiving approaches or marketing material from them? If you want to allow contact, can you choose what form of contact they will take to approach you in the future? Is it easy to find out what the charity will do/not do with your data, if you give it? You may be able to find information on their policy on holding data on their website, either within their terms and conditions or in a section on Frequently Asked Questions if it exists. Alternatively you may choose to contact them directly by email or phone to ask how your data will be handled.

We want our clients, and people in the UK more widely, to be able to enjoy their giving and for it to be effective. By making the UK a nation of ‘smart givers’, I hope we can encourage more people to give to charity and help the many causes which can benefit from our donations. 

Learn more about giving effectively with Barclay Wealth's Smart Guide to Donating’

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