Need to know
- Nearly all of the biggest charities outsource their fundraising to marketing firms who work for commissions
- Charities and the firms they hire can share your data unless you opt out
- The Privacy Act doesn't apply to most charities, meaning your details can be passed along with few restrictions
Lots of us are willing to reach into our pockets to help people in need, which probably explains why there are over 60,000 registered charities in Australia.
The sticking point for many consumers is when charities outsource their 'personal engagement' fundraising efforts to commission-driven third-party businesses – the ones who call up seeking donations or ask you for money in public places.
While registered charities are exempt from the Do Not Call register for ostensibly good reasons, the fundraising calls – and the face-to-face encounters – can sometimes feel like harassment.
'There were just too many calls'
In recent weeks, CHOICE has heard from a number of consumers who feel that the methods charities and their agencies use to get people to give may be counterproductive.
"We donated something in a mall and then that charity and other charities started to call our landline, charities we never heard of," Henning tells CHOICE.
"There were just too many calls coming in, so we didn't even answer the landline any longer. You think, 'either it's a charity or it's a scammer'."
We donated something in a mall and then that charity and other charities started to call our landline, charities we never heard of
Henning, longtime charitable donor
"I have a number of charities that I give to, and they don't pester me with calls," Edward says. "There's all these scams going on, so who's going to give their credit card details to some cold caller? I think it's utterly stupid. Then if you give something, they will never take you off the list. And they keep calling you."
Maggie says the charity cold calls she receives are also a waste of her and the charity's time.
"It's very unproductive. I looked at what I can afford to give, and I picked out charities that match my values and my interests, and set up direct deposits to them monthly. That's my donation budget, and it's fully subscribed," Maggie says.
Charity marketing firm behaviour
According to a 2017 report on commission-based fundraising sponsored by the Australian Competition and Consumer Commission (ACCC), the extent to which charities oversee the behaviour of the agencies they hire varies, with some exerting very little control at all.
And this seems to be where charities can work against their own interests. It would be one thing if face-to-face fundraisers, for instance, had a personal stake in the cause, but they're mostly international students or travellers with a vested interest in getting you to donate.
Like the telemarketing firms, they work for commissions and bonuses, and they're under pressure to bring the money in.
A charity's leaders, such as the CEO and the board, are collectively responsible for the way their charity conducts its fundraising
ACNC spokesperson
A spokesperson for the Australian Charities and Not-for-profits Commission (ACNC), a federal agency whose mission is to "promote trust and confidence in the charity sector", tells CHOICE "there have been examples of external fundraising agencies using questionable tactics to get donors to commit to regular ongoing donations. This can impact public goodwill and damage the reputation of both the charity and the wider sector."
While the ACNC provides guidance for the sector, it doesn't regulate the behaviour of external agencies or approaches to fundraising in general.
"A charity's leaders, such as the CEO and the board, are collectively responsible for the way their charity conducts its fundraising," the spokesperson says.
Industry view at odds with donors
Being bombarded with charity calls and other contacts can diminish a donor's willingness to give.
Sally Shepherd, executive manager for membership and marketing at the Fundraising Institute of Australia (FIA), says the cold calls and other methods charities use to solicit donations are effective on the whole, otherwise charities would put their resources elsewhere.
"Charities measure it and test it, and unless it's actually raising money for the charity, they would have to stop doing it because it wouldn't be viable," Shepherd says.
Given the tens of thousands of charities vying for your dollars, however, she admits it's hard to know when potential donors are being over-contacted to the point of annoyance.
"It would be very difficult to get the consumers together to do that sort of research," Shepherd says.
Are they sharing your data?
The people we've heard from take particular issues with their details being passed around from charity to charity. For some, deciding to give to a particular charity seems to open the floodgates.
But there are steps you can take to cut down on the cold calls and mail, according to Shepherd.
Members of FIA are meant to adhere to its voluntary code, which says fundraisers must comply with requests to not receive future solicitations.
It's legal if they want to share their data with other charities, but they do have to provide an opt out to the donors
Sally Shepherd of the Fundraising Institute of Australia
"When it comes to sharing data, all charities have their own policies," Shepherd says. "It's legal if they want to share their data with other charities, but they do have to provide an opt out to the donors. And it has to be clear."
The ACNC spokesperson told us that a charity "must not share a person's information or data with other charities or organisations unless the person has given consent for the charity to do so, or the person would reasonably expect the charity to do so".
The Privacy Act imposes similar restrictions, saying personal information collected for one purpose can't be passed on for a secondary purpose without consent.
But the Act only applies to charities with annual revenue of over $3 million, and 81% of charities take in less than $1 million a year.
Do freebie gifts make you want to give?
Maggie has no doubt that charities are sharing her data, but she doesn't think it's doing much good.
"It's pretty obvious that they share addresses, because I get gifts like pens with my name on them and shopping bags from charities that I don't give to. And I think they're trying to guilt me into giving them something in response. And my attitude is, well, no, I didn't ask for it. It's a disincentive, and I think they're wasting their money."
Some people get very angry about it, but some people love it. They look forward to it
Sally Shepherd, Fundraising Institute of Australia (FIA)
Others who we've heard from also say the complimentary trinkets diminish their desire to give.
But Shepherd of he FIA says they're working as intended based on her 15 years in the industry.
"I used to send out hundreds of thousands of mail packs. And we tested the inclusion of an item as a thank you. The response rates were higher when we did include those items. Some people get very angry about it, but some people love it. They look forward to it."
Some of the gifts that charities give to donors and potential donors.
The way forward
In February this year, Australian state and territory treasurers agreed to a number of national fundraising principles that include the requirement that third-party charity fundraising firms identify themselves as such and explain that they make a profit from any donations given as well as the charity. Charities and the firms they hire must also comply with requests not to receive future solicitations.
This would come as good news to the consumers we've heard from. Meanwhile, some charities could learn from others when it comes to keeping donors happy.
"My wife gives to a guide dog organisation," Edward says. "They promise not to call you and they don't. Because my wife keeps giving they don't engage you too often. So some are doing it well."
How outsourced fundraising agencies make their money
- Agencies get paid eight to 17 times the amount of any new donation.
- A charity can claw back some of this money if the donor that the agency signed up stops giving.
How to get charities to stop calling
As is often the case in the consumer marketplace, we're left to fend for ourselves if contacts by charities reach the level of harassment. The ACNC recommends the following:
- Go to the ACNC charity register to find the contact details of the charity that's calling you.
- Get in touch and ask that they stop calling and that they don't pass on your details to other charities or marketing firms.
- If the calls or other contacts keep coming, lodge a complaint with the Office of the Australian Information Commissioner (OAIC).
Stock images: Getty, unless otherwise stated.
