Seedling Giving x Andreyev Lawyers: How to distinguish between high and poor performing charities this EOFY

Seedling Giving x Andreyev Lawyers: How to distinguish between high and poor performing charities this EOFY

At Andreyev Lawyers, giving back is something we believe in strongly. We feel privileged to be in a position to support causes we believe in, and we love to encourage individuals and groups in our network to do the same.

Many of our clients have a goal to give – whether by donating their time, money, knowledge and experience, or through bequests or structured giving. We enthusiastically encourage charitable giving and do what we can to facilitate this for our clients in a way that creates the biggest impact possible.

Often our clients that think about giving before the close of the financial year get caught up in indecision and overwhelming feelings about which organisations to give to (it is, after all, ‘giving season’ as well as tax season!). There are over 60,000 charities to choose from in Australia. How can you possibly sift through all of the options? And even if you do narrow down on an ideal cause – how do you know you are giving to an organisation that can be trusted and that does the work it promises?

Enter Seedling Giving. Earlier this year, we had the opportunity to work with Kylie Wallace and Jess Bowman, co-founders of Seedling Giving on the next phase of their exciting offering – the launch of a revolutionary charity matchmaking platform. Kylie and Jess help individuals and organisations by ‘charity matchmaking’ donors with charities that align with their giving goals.  With their strong knowledge of the charity landscape in Australia and expertise in analysing charitable operations and identifying high performing charities, the Seedling Giving team has helped place over $1 million in charitable donations to date.

We have been lucky to get a snippet of Jess Bowman’s insights on how you can distinguish between high and poor performing charities this EOFY, and to share her thoughts with our readers. We hope you enjoy this guest authored article and it provides useful guidance to you about how you can put your charitable dollars towards good causes this financial year.

 

Distinguishing between high and poor performing charities this EOFY

In any industry, there are top performers and underperformers, and the charity sector is no exception. Merely donating to any organisation claiming to be a charity does not guarantee assistance to those in need. Without due diligence, one risks inadvertently lining the pockets of unscrupulous individuals.

Several techniques can help differentiate between high and poor performing charities. These methods include verifying the legitimacy of the charity, ensuring the authenticity of its leadership, and confirming that funds are utilised for their intended purpose.

 

Is the Charity Legitimate?

Some of the most dubious “charities” operate without proper registration. These fraudulent entities often utilise social media advertising or host glamorous events to solicit funds for purportedly noble causes. While their presentations may be convincing, it’s crucial not to take appearances at face value.

A straightforward method to ascertain a charity’s legitimacy is to conduct a quick search with the Australian Charities and Not For Profit Commission (ACNC), the designated charity regulator. This search will reveal whether the organisation is a registered charity. If it isn’t listed, it’s prudent to either seek clarification or avoid involvement altogether.

 

Is the Charity’s Leadership Authentic?

Even legitimate charities can be led by individuals with questionable motives. To verify the integrity of the charity’s leadership, check the ACNC website to identify the names of its directors.

Ensure these individuals are suitable for their roles by:

  • Reviewing their backgrounds and experiences on LinkedIn.
  • Checking the Australian Securities and Investment Commission (ASIC) banned and disqualified list to ensure they have no history of misconduct.
  • Consulting the Department of Foreign Affairs’ (DFAT) Consolidated List if they lead an international aid charity, to ensure compliance with Australian sanctions laws.

 

Is Money Appropriately Utilised?

A crucial aspect of discerning between high and poor performing charities is reviewing their financial records. Confirm that the accounts have been audited for reliability and scrutinize spending to ensure that at least 70% of the income is allocated to the cause. Additionally, examine the notes for any related party transactions, which could indicate conflicts of interest or improper financial practices.

 

Conclusion

While there are undoubtedly subpar charities that tarnish the sector’s reputation, there are also exceptional organizations making significant strides toward their missions. When selecting a charity to support, it’s essential to distinguish between the good and the bad performers, ensuring that your donation contributes to meaningful impact.

Author: Jessica Bowman is the co-founder of Seedling Giving and founder of philanthropic advisory firm The Good Cause Co. She has Bachelor of Finance (Economics) and Masters’ of Science (Environmental Science). Jessica has 15 years professional experience evaluating the costs, benefits and risks of public investment and 10 year’s experience analysing charities. To find a high performing charity to donate to, visit https://seedlinggiving.com.au.

 

The information contained in this post is current at the date of publishing – 6 May 2024.

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