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Why do charities fundraise?

This is one of seven fact sheets in a series about reporting on charity issues. It provides context for accurate reporting and details of where to get more information.

Other topics in the series are:

  1. How can I tell how effective a charity is?
  2. Why do charities have paid staff?
  3. How much money goes on running costs?
  4. Why do charities deliver public services?
  5. Why do charities campaign?
  6. Are there too many charities?

Download this fact sheet as a PDF (50KB)


Charities spend an average of 12.9% of their budget on activities to raise more money. The UK is one of the most generous countries in the world and was most recently ranked as the most generous country in Europe.

For every pound a charity spends on fundraising on average it will receive £4.20. This allows charities to quadruple money available for the causes they work on, and maximise the good they are able to do with public donations. With this kind of return, it would be foolish for charities not to invest in fundraising activities.

Issues and changes to practice and regulation

Issues uncovered in recent media coverage highlighted that, in some cases, charities had fallen short of their own standards. 

As a result, there has been a significant amount of change in the way that many charities fundraise. Some charities have moved to ‘opt-in’ only models of consent for contacting donors, others are reviewing their practices and processes to make sure they are in line with what donors expect, and charities are ensuring greater oversight of any organisations carrying out fundraising on their behalf.

In addition, the Code of Fundraising Practice for charities has been toughened up including the banning of selling data and new measures to protect more vulnerable individuals. A new regulator has been established with stronger powers to take action against charities that break the rules.

Why charities work with fundraising agencies

Charities are able to work in partnership with private companies on fundraising drives. This can benefit charities in two main ways:

Firstly, it can be cost effective for charities to have the flexibility of working with a fundraising agency – for example if a charity needs to rapidly increase their capacity to fundraise in response to an emergency or disaster they may want to partner with an agency to quickly scale up their work. This is cheaper and better value for the charity and donors, than setting up the fundraising services in-house.

Secondly, fundraising agency often have not only manpower, but skill sets and processes in place which would be difficult and costly for a charity to have ‘in-house’. So partnering with a fundraising agency can be beneficial and mean charities have more to spend on good causes as a result.

It is essential that when this is done charities ensure proper due diligence and oversight, and that the work being carried out on their behalf reflects the values and approach of the charity themselves.

Role of the Fundraising Regulator

A newly created Fundraising Regulator became operational in 2016. It is independent and sets the Code of Fundraising Practice. This Code of Fundraising Practice sets the standards all fundraising must adhere to from emails to phone calls, door-to-door and street fundraising. Previously, the Code of Fundraising Practice had been set and regulated by the charity sector itself.

The regulator investigates complaints and has the power to name and shame transgressors, stop organisations using certain types of fundraising for a time and order compulsory training.

Charities that spend above a certain level on fundraising activity are charged a levy by the regulator each year to cover its costs.

The Fundraising Regulator is also responsible for setting up and running a ‘Fundraising Preference Service’, which will provide the public with a way to stop unwanted fundraising requests.

Useful press contacts

National Council for Voluntary Organisations (NCVO)

  • This email address is being protected from spambots. You need JavaScript enabled to view it.
  • Telephone 020 7520 2413
  • Out of hours 07714 243 942
  • @NCVO

Institute of Fundraising

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  • Telephone 020 7840 3790
  • Out of hours 07765 100 693
  • @ioftweets

Fundraising Regulator

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  • Telephone 020 3327 4050
  • Out of hours 07971 784 224
  • @FundrRegulator

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