Blog – Charity Digital Code of Practice launches – The Good Exchange responds

Blog by Ed Gairdner, COO, The Good Exchange

Thursday 15th November marks the launch of The Charity Digital Code of Practice, which aims to help charities increase impact, develop skills and improve sustainability. Developed by a steering group of organisations across the sector – including the Association of Chief Executives of Voluntary Organisations (ACEVO), The Charity Commission and National Council for Voluntary Organisations (NCVO) – the Code sets out seven principles representing areas of focus: Leadership; User-led; Culture; Strategy; Skills; Managing Risks and Ethics, and Adaptability.

Ed Gairdner, COO of not-for-profit charitable giving platform, The Good Exchange, has made the following comments in response to some of these key principles:

Leadership

True leadership is not just confined to individuals within an organisation; it should be evident in groups coming together to drive change for the greater benefit to others. “The time has come for grant-makers across the voluntary sector to lead the way in adopting digital technology to drive the much-needed transformation. From an operational perspective, harnessing digital technology can transform the infrastructure of the charitable sector, rending it more collaborative, efficient and transparent for all those involved. This has become more important than ever for charities and other not-for-profit organisations across the UK, given the dramatic fall in grant funding in recent years, which has largely been driven by cuts in central and local government budgets. Indeed, government grants declined by 47% from a high of £6.2 billion in 2003/04 (17% of total income) to £3.7 billion (8% of total income) in 2015/16.

Charities and community organisations trying to close budget gaps have been forced to make ever more speculative applications to grant-makers, routinely completing bespoke and time-consuming application forms requesting funding from every foundation and trust they can find because that is what is required of them to secure funds. This isn’t necessarily the best use of resources and certainly isn’t efficient when technology can enable platform and application form integrations and use of metadata tagging to change the current practice of ‘reacting’ to bids to ‘proactively’ seeking and being matched to eligible bids. Grant-makers taking on a leadership role can influence change, by decisively moving away from the established but inefficient resource intensive process for both applicant and grant-maker.

 Managing risks and ethics

“While digital has a great deal to offer to the charitable sector, it’s not without its risks and potential ethical violations, which must be identified and carefully managed. As an example, while the sense of community spirit and generosity that online fundraising fosters is of course to be welcomed, it can also be open to abuse. Indeed, in the aftermath of the Grenfell Tower fire, GoFundMe reported that it had detected and removed a small number of “suspicious” campaigns from its platform. JustGiving also confirmed that criminals are targeting its site for money laundering purposes.

“The Fundraising Regulator responded to instances of abuse such as these by re-writing the Code of Fundraising to incorporate the use of web-platforms. From June 2018*, all fundraising platforms have been asked to sign up to the Code, and all web platforms operating as a payment services provider must also be registered with the Financial Conduct Authority. While regulators have taken decisive action to ensure that fundraising platforms meet the highest standards, online platforms should also be implementing mandatory application processes as an important safeguard, for instance, requiring applicants to complete a detailed online application form, including full organisational and financial details, plus itemised budgets for each charitable project seeking funds. This can then be vetted before an organisation and a funding project can be listed on a platform. While ensuring that the claim is valid, this information can also then be made available to potential funders, donors and fundraisers to help inform their decisions regarding which projects and organisations they’d like to support.”

At the end of a project, an evaluation should also be completed, giving funders full visibility into what was achieved. Ultimately, the more information a charity, project or individual has to provide and the more scrutiny that is undertaken, the more likely it is that the organisation and project will be valid. Simple measures such as this aren’t overly time-consuming, but they introduce much needed accountability. This extra step is unlikely to discourage genuine fundraisers, but will deter fraudsters looking for quick and easy gains.

Adaptability

“The charitable sector is currently operating between five and ten years behind the commercial sector when it comes to digital. In fact, less than a third (32 percent) of CEOs agree that charities are using new technology effectively to increase giving, while 76% of small and medium charities have done no digital resource or data collaboration with other charitable organisations. There must be a strategic drive from all sides, where commercial organisations, trusts, foundations, community groups and more come together to drive and support not-for-profit charitable technology initiatives that can streamline and revolutionise the fundraising and grant giving process.

“Digital is not a leap into the unknown, it is a ‘wave’ that the private sector has been ‘riding’ for many years and third sector innovators are already riding to good effect. Can grant-makers and charitable organisations continue to ignore its relevance? For to be left behind is a huge mountain to climb alone if your peers have moved on and undertaken and implemented a meaningful digital strategy. Therefore, my advice is to ‘ride the digital wave’ now before it is too late.”

Strategy

“The most effective strategies are those that look beyond simply investing money, and that creatively consider how digital can increase impact and sustainability. A highly effective way for charities to begin digital transformation journeys is by taking advantage of the ‘platform era’ to help them match their projects to trusts, foundations and businesses that have money to give. Digital technology underpins ‘collaborative funding programmes’ ­– networks of grant-makers, philanthropists, businesses and public donors working together to tackle geographical/theme-based issues while maintaining autonomy over funds, grant-making and disbursement processes. Through a shared application process, the programmes identify and match eligible charitable organisations to individual grant-makers’ criteria. Customised online dashboards instantly show collaborative funding opportunities, funding budgets, donations and fundraising activities for each application. Digital collaborative funding programmes also enable match funding grants to incentivise public donations and additional grants.”

User led

“Smaller charities and community organisations can use digital tools to bring all of their grant applications, fundraising and awareness campaigns together for the benefit of all users. With the right partnerships and technology, the processes associated with fundraising can be streamlined. Digital tools bring efficiency gains, more transparency and greater collaboration, all of which help level the playing field for small and mid-sized charities. Many have been quick to recognise the impact of social media and online fundraising but still struggle to maintain a consistent calendar of campaigns, often being unable to develop or access the skills and knowledge needed to bring it together with their grant application processes.”

You can follow what people are saying about the code on Twitter via the hashtag #CharityDigitalCode.