Charities must work to repair public confidence or lose out financially
The UK charity sector could lose out on billions of pounds if it does not repair public confidence in the wake of a summer of scandals.
A data intelligence group has estimated that a drop in donations caused by bad publicity could cost the sector more than £6.57 billion.
The group, called GBG, made the claim after it was revealed that a data breach had seen a pensioner’s details repeatedly sold, meaning he was bombarded with requests for cash.
More seriously, the family of 82-year-old Samuel Rae, who suffers from dementia, claim his details fell into the clutches of fraudsters, who conned the former army colonel of £35,000.
GBG’s chief executive Richard Law said charities must prove themselves beyond reproach when it comes to handling people’s data.
Why are charities destroying their core business by becoming list brokers or data merchants?
He said: "The charity sector has scored a real own goal here. Its customers are among the potentially most loyal and most engaged of any sector so why on earth are they risking destroying their core business by becoming list brokers or data merchants?
“The data that donors have shared over the years is their most valuable asset but it was shared on a fundamental basis of brand trust.
“Our research into what makes people trust organisations with their data shows that 62% of people will not provide personal information if they don’t know how it’s to be used. In the charities sector, we calculate this could equate to a loss of more than £6.57bn.
“If donors stop trusting the sector because they don't know how their data is going to be used in future, we all suffer: the charities and their beneficiaries but also the wider business world which now relies so heavily on the availability of good-quality data.
“What's called for here is a back to basics approach – get the data right, keep it safe and be absolutely transparent with how you use it. No excuse for anything less.”
The sector has been rocked by a series of fundraising scandals over the summer, including the furore over the death of poppy seller Olive Cooke, who died after being bombarded by charity requests.
A review was launched of fundraising practices following her death – even though her family absolved charities of any blame.
