It’s Giving Tuesday! (Time for a Year-End Charitable Promotion Check-Up)
Did your company advertise about its charitable giving this year? Did it talk or post publicly about a charitable cause? If you’re like most companies, your organization is already planning how to structure and publicly promote its 2021 giving and other charitable involvement.
Appropriately, much attention has been directed to charitable causes throughout 2020, and this is likely to continue – consumers are demanding it, so companies and regulators are responding. Whatever form a for-profit company’s charitable giving takes, if you communicate about it publicly, there are compliance issues to consider.
Here are some questions to explore within your organization to start gathering the relevant information and addressing the related compliance issues:
Is your company aligning its brand with a cause, even if not a particular charity?
Does your company’s website have a page or section describing its charitable activities?
Is your company considering setting up your own foundation, B-corp/LC-3, or non-profit arm?
Are you exploring a new or renewed partnership or other arrangement with a charity?
Is your company discussing working with a donor-advised fund?
Are you planning to work with a fundraising platform?
Are you considering a charity sweepstakes, game, or other program where the winning non-profit receives a donation or the winner gets to designate where the prize donation money is directed?
Does your company encourage social media users to take action to influence a donation?
Do you collect or hold funds from others that will be donated to a charity?
Is your company involved in applying for grants or awarding them?
Are you involved in a program or event of any kind that is advertised and will benefit to any extent a charity or charitable purpose?
Do you plan to advertise that the purchase or use of any goods, services, entertainment, or any other thing of value will benefit (in whole or in part) a charity or be used for a charitable purpose?
Are you planning to offer something other than money to a charity?
Answering these questions is the first step to determining what will be needed for charitable program compliance, as well as to navigate the tax, finance, privacy, and other implications. Charitable promotion compliance generally falls into these categories: commercial coventurer programs, donation collection, free-action programs, professional fundraisers, or charities themselves. Compliance requirements and related risks depend heavily on the details of what is planned, so knowing what is planned with plenty of lead time for compliance is the goal. And knowing what questions to ask is a good start.