Here are the Ontario Public Guardian and Trustee’s Tips for Managing Fundraising Risks.
Tips for Managing Fundraising Risks
Directors and trustees who wish to avoid complaints about a charity’s fundraising practices and the use of charitable property should follow the guidelines set out below:
1. Know the governing documents. These are the documents that set up the charity, such as its letters patent, trust deed or constitution. The documents will describe the objectives or purposes the charity was set up to fulfil and will set out the powers of the charity as well as any limitations on these powers. Directors and trustees should always ensure that fundraising campaigns will further the charitable purposes of the organization.
2. Know your duties, responsibilities and powers as a director or trustee (see Duties, Responsibilities and Powers of Directors and Trustees of Charities).
3. Document all deliberations, actions and decisions regarding fundraising campaigns.
4. Become familiar with fundraising best practices and decide which practices are applicable to your organization.
5. Be open and transparent. Share information with members and donors so they understand your decisions. Encourage members and donors to share any concerns they may have and address those concerns promptly.
6. Be knowledgeable about all aspects of the fundraising campaign. Consider the costs and risks of different fundraising strategies. Make sure that there are no misrepresentations being made and that the costs of the campaign are reasonable.
7. Know if the charity has any restricted or special purpose funds. Find out what the restrictions are and make sure detailed records are kept.
8. Keep full and complete financial records and ensure special or restricted purpose funds are deposited and accounted for separately.
9. When soliciting special purpose funds provide an alternate purpose in the event the original purpose should fail.
10. Ensure that special purpose funds that are not needed immediately are invested in compliance with the Trustee Act and the Regulations under the Charities Accounting Act (see Investments By Directors and Trustees of Charities).
For more information see: https://www.attorneygeneral.jus.gov.on.ca/english/family/pgt/charbullet/bullet8.php
Do you require legal advice with respect to Canadian or Ontario non-profits or charities?
Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.