ORIGINAL PAPER Canadian Leapfrog: From Regulating Charitable Fundraising to Co-Regulating Good Governance Susan D. Phillips Published online: 30 November 2011 Ó International Society for Third-Sector Research and The John’s Hopkins University 2011 Abstract The regulation of charitable fundraising is no longer just about the regulation of fundraising but about good governance, and increasingly involves co- regulatory regimes which blend elements of self- and state regulation. Canada’s charitable sector has undertaken a bold experiment in creating a comprehensive certification system for good governance, including fundraising, which reframes the target of regulation from the informed donor to the well-performing charity and has the ambitious goal of building a community of practice for self-improvement. At the same time, the federal government has introduced new guidance on fundraising that not only outlines accepted cost to revenue ratios but also specifies standards of good governance. It is an open question as to whether this new self- and state regulation will remain as dual systems or evolve into a hybrid co-regulatory regime in which government integrates sector certification into its own risk management. Re ´sume ´ La re ´gulation de la collecte de fonds caritative n’a plus seulement trait a ` ladite collecte mais traite de la bonne gouvernance, et implique de manie `re croissante des re ´gimes co-re ´gulateurs associant des e ´le ´ments d’autore ´gulation comme de re ´gulation par l’e ´tat. Le secteur caritatif du Canada a initie ´ une expe ´- rience audacieuse avec la cre ´ation d’un syste `me exhaustif de certification pour une bonne gouvernance, incluant la collecte de fonds. Le cadre de la re ´gulation se voit S. D. Phillips (&) School of Public Policy and Administration, Carleton University, 10th Floor Dunton Tower, 1125 Colonel By Drive, Ottawa, ON K1S 5B6, Canada e-mail: [email protected]S. D. Phillips Centre for Charitable Giving and Philanthropy, Cass Business School, City University London, London, UK 123 Voluntas (2012) 23:808–829 DOI 10.1007/s11266-011-9237-x
Transcript
ORI GIN AL PA PER
Canadian Leapfrog: From Regulating CharitableFundraising to Co-Regulating Good Governance
Susan D. Phillips
Published online: 30 November 2011
� International Society for Third-Sector Research and The John’s Hopkins University 2011
Abstract The regulation of charitable fundraising is no longer just about the
regulation of fundraising but about good governance, and increasingly involves co-
regulatory regimes which blend elements of self- and state regulation. Canada’s
charitable sector has undertaken a bold experiment in creating a comprehensive
certification system for good governance, including fundraising, which reframes the
target of regulation from the informed donor to the well-performing charity and has
the ambitious goal of building a community of practice for self-improvement. At the
same time, the federal government has introduced new guidance on fundraising that
not only outlines accepted cost to revenue ratios but also specifies standards of good
governance. It is an open question as to whether this new self- and state regulation
will remain as dual systems or evolve into a hybrid co-regulatory regime in which
government integrates sector certification into its own risk management.
Resume La regulation de la collecte de fonds caritative n’a plus seulement trait a
ladite collecte mais traite de la bonne gouvernance, et implique de maniere
croissante des regimes co-regulateurs associant des elements d’autoregulation
comme de regulation par l’etat. Le secteur caritatif du Canada a initie une expe-
rience audacieuse avec la creation d’un systeme exhaustif de certification pour une
bonne gouvernance, incluant la collecte de fonds. Le cadre de la regulation se voit
S. D. Phillips (&)
School of Public Policy and Administration, Carleton University, 10th Floor Dunton Tower,
The regulation of charitable fundraising has become a hard edge where pressures for
enhanced public accountability meet private governance.1 In recent years, a number
of countries have introduced or significantly expanded the regulation of charitable
fundraising, putting differing emphasis on state regulation, self-regulation, or some
combination. This international trend is driven, in part, by a highly competitive
environment in which more organizations are chasing limited funds and by
technology, particularly the internet, which is changing the nature of fundraising. It
is also a reflection of heightened public expectations of radical transparency and the
growing presence of the ‘‘regulatory state’’ (Jordana and Levi-Faur 2004; Scott
2004) in which prescriptive, rule-based regulation is meeting new forms of self- and
co-regulation. A distinctive feature of the evolving regulatory state is not only
greater regulation of private governance (e.g., ensuring the governance systems of
private organizations are up to state determined standards) but also greater
regulation by private governance (e.g., by sector-led certification systems). In line
with these broader developments, the recent interest in regulation of charitable
fundraising has moved beyond a narrow focus on fundraising per se to encompass
the regulation of good governance, and this cannot be achieved by prescriptive
regulation.
Canada is at the leading edge of such change. Historically, Canadian
governments have been reluctant regulators of charitable fundraising. The
provinces, which hold the constitutional authority, have been largely uninterested
and the federal government, which as the central tax collector is the de facto
regulator of charities, did not push its jurisdictional boundaries to directly regulate
fundraising practices. This changed in 2009, partly in response to serious misuse of
charities as tax shelters through which over 172,000 Canadians claimed $5.4 billion
CDN in donations since 2003 (Hawara 2011). The Charities Directorate of the
Canada Revenue Agency (CRA) not only aggressively stepped up monitoring and
auditing of possible tax shelters but also established a new Guidance on Fundraising
that articulates what constitutes ‘‘fundraising’’ expenses and sets acceptable ratios of
fundraising costs to revenues. This is not particularly distinctive as ratios are
commonly used by both governments and independent watchdogs, although they
have been widely criticized as irrelevant, bad practice and, indeed, harmful in
promoting better public understanding of the charitable sector (Flack 2004;
Steinberg and Morris 2010). The more interesting component is that the CRA has
identified the governance systems that it expects charities to have in place to reduce
the risk of incurring excessive fundraising costs. This potentially represents a more
intrusive type of regulation in which the regulator delves into the internal operations
of private organizations by identifying and monitoring the leadership, management,
control, and evaluation systems that it regards as constituting ‘‘good governance.’’ It
1 Charitable fundraising embraces a wide swath of methods of solicitation of donations and gifts, both
large and small, although for purposes of regulation this normally excludes membership fees and
purchase-of-service contracts. Fundraising through charitable gaming and lotteries usually involves
additional regulation which is not discussed in this article.
810 Voluntas (2012) 23:808–829
123
remains to be seen whether the CRA will treat such process-oriented regulation
(Gilad 2010) as soft guidance or hard rules.
The lead infrastructure organization of the charitable sector, Imagine Canada,
also took a huge leap from a 2008 re-launch of a longstanding but under-subscribed
voluntary code of ethical fundraising to the development of a comprehensive
certification system for good governance, of which fundraising is only one
component. The goal of this new certification system is ambitious, intended to build
a community of practice for self-improvement. This is a bold move for a sector that
has not been particularly supportive of its infrastructure organizations and that until
recently saw little need for sector-wide standards at all. If this Standards Program
succeeds, it could become a world leader in self-regulation for the charitable sector,
but in these early stages there remain many questions about its future—questions
which this article explores. It is still uncertain as to how the new government and
sector-led systems will work as a regulatory regime. Will they develop as an
integrated regime of co-regulation, or exist as separate, dual systems with different
regulatory goals, compliance mechanisms, and outcomes? Before assessing the
unfolding Canadian experience, it is important to question the assumptions that
underpin the regulation of charitable fundraising and briefly examine alternative
approaches to both self- and co-regulation, drawing on lessons learned from other
sectors about what makes each effective.
Regulating from Somewhere: What’s the Problem? Who’s the Target?
In a critical assessment of environmental regulation, Kysar (2010) argues that a
fundamental problem is that governments are often ‘‘regulating from nowhere’’—
intent on measuring impacts while the reasons for regulating are obscure or
muddled, thereby leading down regulatory routes that may not be appropriate. The
same could be said of the regulation of charitable fundraising.
By law, charities are required to direct substantially all their resources (however
‘‘substantially’’ may be defined) to their charitable purposes, prompting many
governments to place limits on the proportions of revenues that can be directed to
administrative, political, and fundraising activities. The basic principles of ensuring
money raised goes to charitable purposes and avoiding fraud are hardly contestable,
and could be readily handled by regulators equipped with adequate reporting and
monitoring, assisted by offices of attorney general and police. This does not
necessitate elaborate rules or regulatory machinery (see Barber 2011). The interest
is broader than catching the few bad apples, however, but pertains to enhancing
transparency so as to maintain public trust in charities as a whole given that they use
public money—both directly in accepting donations and indirectly through the
privilege of issuing tax receipts for these donations which, as foregone taxes, are
costs to the public purse. Regulation through transparency is aimed primarily at
donors to educate and empower them to make good choices in their charitable
giving. With appropriate information, donors can make more enlightened decisions
about how to direct their support, giving to organizations that have acceptable
Voluntas (2012) 23:808–829 811
123
fundraising costs and ethical practices and avoiding those that do not.2 In addition,
charities that rely on external donations will respond to donor expectations, both by
being more transparent in disclosure of their fundraising practices and altering their
behavior to meet acceptable standards (Szper and Prakash 2010; Auld and
Gulbrandsen 2010). Information thus becomes ‘‘doubly embedded’’ in the actions of
both donors and charities (Weil et al. 2006).
When information can be doubly embedded in a timely way, it has the desired
effect on behavior: seeing the one (out of five) star rating on hygiene on the
restaurant door gives the entering diner serious pause, as does a ‘‘high risk’’ rating
on a financial product being recommended by one’s financial advisor (Weil et al.
2006). The same is not true for disclosure of the ratings of charities, however. In
studies of the impact of the ratings by third parties, Sloan (2009) found that positive
ratings have a slight positive effect on contributions, but bad ratings have no effect,
while Szper and Prakash (2011) found no effects on donor decisions of either good
or poor ratings. One reason is that the information that is required to be disclosed is
mainly related to financial inputs while what is of primary concern to donors are
program content and organizational reputation (Szper and Prakash 2011). Although
transparency has an important place in a world rapidly moving toward expectations
of open data, it alone does not appear to produce significant changes in behavior—
of either donors or charities.
Two common market failures also motivate fundraising regulation. The first
relates to the dependence of charities on for-profit fundraising firms, and normally
occurs when charities, desperate to raise some threshold amounts, agree to
commission based or extraordinarily high fees.3 A charity cannot manage the
fundraising on its own, and regards some funds as better than none, so it becomes
dependent on the commercial firm—which may or may not lead to good practice. A
second issue is that the return on fundraising investment is highly speculative,
especially in contrast to the core programs and activities that charities are familiar
with running. The speculative nature of these outcomes reinforces the case for
sound strategy and prudence in fundraising, and intimately links decisions on
fundraising to broader practices of good governance. While credentializing of
individual fundraisers, for example, with the Certified Fund Raising Executive
(CFRE) designation, and their adherence to attendant professional codes of conduct
may mitigate the risks of ill-advised campaigns, smaller charities rarely have staff
with such credentials, and the onus remains on the organization to set and follow
good practice. In addressing these market failures, the primary target of regulation is
not the donor but the charity, and regulatory approaches need to focus on
transparency of both outcomes (e.g., fundraising and program results) and
procedures (e.g., openness of governance processes).
2 The requirement for information and reporting may occur at different points of the fundraising lifecycle
(Breen 2009): pre-solicitation (e.g., authorization for a fundraising campaign); the moment of solicitation
(e.g., disclosure to donors of the percentage of the donation that goes to the charitable cause); when funds
are transferred from a third party fundraising businesses to a charity; and annual reporting to a central
regulator (e.g., limits on fundraising expenses).3 Note that percentage-based fundraising is contrary to the ethical code of the Association of Fundraising
Professionals and the charitable sector’s own code.
812 Voluntas (2012) 23:808–829
123
In short, the regulation of charitable fundraising needs to check its assumptions.
Extensive behavioral change will depend on more than donor education. It compels
charities to improve their governance systems as they relate to fundraising practices,
and necessitates creating incentives and building capacities for learning and self-
improvement. It makes a case for greater self-regulation because organizational
learning cannot be driven by prescriptive rules (Breen 2011) and because
fundraising over the internet, which is not bound by geography, is extremely
difficult for governments, which are bound by geography, to regulate through
conventional rules. As the regulation literature demonstrates, different regulatory
instruments and institutions offer differing incentives for self-improvement, and it is
increasingly common for regulatory regimes to involve a mix of state and non-state
actors, as well as a variety of different instruments.
Co-Regulation: Differing Intersections
‘‘Regulation’’ has become a much bigger umbrella in recent years as both the
variety of regulatory instruments and the means of engaging state and non-state
actors have multiplied. Alternative approaches can be characterized in a general
way according to the degree of involvement and discretion on the part of
government and sector actors, as shown in Fig. 1.
Fig. 1 Intersections of state and sector regulation
Voluntas (2012) 23:808–829 813
123
As the regulation of charitable fundraising blends into regulation of good
governance, prescriptive rules become inadequate given more complex objectives,
lack of uniform means of achieving them and higher costs associated with
monitoring internal processes. The emerging challenges thus lie in quadrants 3 and
4: making self-regulation work and managing new forms of co-regulation. As the
charitable sector follows many others in putting more bite into self-regulation
through the creation of certification systems and as government enters the
‘‘regulation’ of private governance, there is much that can be learned from the
experience of other sectors, for both certification and co-regulation.
Carrots and Clubs of Certification
Self-regulation is collective action by a significant number of non-state actors to
shape their own behavior and that of others in a (sub)sector through the
establishment of norms, standards, and credible commitments, supported by
mechanisms that induce adherence, which has substantial legitimacy across the
sector and with governments, stakeholders, and citizens. The goals of self-regulation
may vary from avoiding state regulation to producing fundamental behavioral
change in a sector, and the mechanisms can range from relatively non-prescriptive
voluntary codes to mandatory accreditation which may, in effect, serve as a license
to operate. Third party certification is a milder form of accreditation, done on a
voluntary basis, which is intended to encourage self-improvement and raise overall
standards in a sector by having organizations adopt recognized good practices. The
certifying body monitors and reports on compliance, and may or may not have the
capability of levying sanctions for non-compliance. Certification serves as a
hallmark of quality not a permit to operate, and often the process is initiated and run
by what Sidel (2005) calls ‘‘associational entrepreneurs.’’ It is becoming increas-
ingly common for governments to integrate sector certification into their own
regulatory frameworks by foregoing or reducing licensing and other regulatory
requirements for organizations that adhere to state ‘‘approved’’ certification systems,
thereby creating hybrid regimes.
Proponents of self-regulation argue that, because it is inherently bottom-up and
consent-based, it is cost effective, and able to build inter-organizational relationships,
encourage ‘‘norm conversations’’ that lead to even higher standards, and monitor
outcomes in a complex, fragmented environment, thereby empowering an entire
sector (Webb 2004; see Bies 2010). However, past attempts at voluntary codes in the
non-profit sector have lacked teeth, and were often under used and eventually
abandoned (Bothwell 2000; Sidel 2005, 2010). Yet, self-regulation has proven
relatively successful in a variety of other sectors, from ‘‘Responsible Care’’ in the
chemical industry to sustainable forestry, and a substantial body of literature on these
initiatives provides some valuable lessons on what makes self-regulation work.
How the underlying problem is framed helps to bring together diverse sets of
actors and shapes the direction that collective action takes. Seldom will the
‘‘problem’’ be solved if the sole focus is on transparency and educating consumers;
rather, the regulatees need to have an interest in and incentives for self-control and
improvement, and collectively the capacity to lead behavioral change. The structure
814 Voluntas (2012) 23:808–829
123
of the sector thus makes a difference. Sectors that are characterized by small
autonomous organizations, which may be reluctant to incur the costs of joining self-
regulatory schemes, or those dominated by a few large players which are resistant to
change pose the greatest challenges for self-regulation (Gulbrandsen 2005). In any
sector, the early adopters are normally organizations that: are already compliant or
sufficiently large that the costs of participation can be readily absorbed; are trying to
differentiate themselves; have a highly visible brand they seek to protect and
promote; or whose operations are transnational (Auld et al. 2008). Getting some of
these actors on board early tends to reduce resistance from the broader sector, but
uptake still takes time.
Institutionalizing certification depends on the ability to establish widely accepted
norms and political legitimacy (Bernstein and Cashore 2007). This unfolds by
enmeshing norm-driven behavior (doing the ‘‘right’’ thing) into the strategic, self-
interest of individual organizations (maintaining competitive position in the field)
(Bernstein and Cashore 2007; Cashore 2002). As Bartley (2007) notes, it also entails
fostering inter-organizational networks and actively enrolling others into a
collective project. In particular, it involves making effective use of organizational
‘‘supply chains.’’ For example, participation in sustainable forestry certification
expanded greatly once big intermediaries that link producers and consumers—such
as Home Depot (the large North American home-improvement chain) and Victoria
Secret (the lingerie firm that had a heavy reliance on paper for its catalogues)—
came on board because their suppliers and competitors then saw value in joining. As
the International Organization for Standardization (ISO) process demonstrates
(Auld et al. 2008; Kollman and Prakash 2002), norm building is greatly facilitated
when supported by learning opportunities, whether done by the certification body or
other parties. Support from foundations and other funders is also important.
Successful industry certification bodies, for example, the Forestry Stewardship
Council, have not been initiated and sustained on the basis of membership fees
alone but had foundation and other sponsors, and foundations also undertook field
building by supporting NGOs to promote corporate demand for sustainable forest
projects (Bartley 2007, p. 248).
Success also depends on internal governance and the balance it strikes among
competing objectives. Certification bodies may be structured as autonomous entities
or as membership organizations, often referred to as ‘‘clubs.’’4 The advantage of a club
is that it can sanction its members while the downside is that it risks being seen as a
‘‘club’’ in the exclusive sense. Its essential dilemma is to balance maintenance of high
standards with the imperatives of member recruitment and retention (Prakash and
Gugerty 2010; Knill and Lehmkuhl 2002). This means that standards must be lenient
enough to facilitate broad participation but stringent enough to give its hallmark
meaning, and that the price of membership must be high enough to provide a
sustainable club but not so high as to be a serious barrier to entry. A central question of
legitimacy is: how many members are enough? While subscriber numbers matter,
4 A club is defined by three attributes: the requirement that members act in ways that go beyond existing
legally required obligations; the imposition of costs on members in exchange for reputational branding (a
hallmark that can be publicly trusted); and provision of private benefits, usually in the form of
organizational learning (Prakash and Gugerty 2010; Potoski and Prakash 2009).
Voluntas (2012) 23:808–829 815
123
viability is not a numbers game alone. The kind of behavioral change that self-
regulation seeks to affect generally occurs over a long period, and what is important in
the initial stages is who the early adopters are and whether they can create a tipping
point for norm change. This gets balanced against ensuring there are enough paying
members to provide adequate organizational capacity and legitimacy for stakeholders,
recognizing that certification bodies do not survive on membership fees alone. The
related issue is how to ensure adherence. Evidence from a wide range of industries
indicates that compliance does not depend primarily on fear of negative consequences
but on a recognition of strategic interest and sense of duty by managers of participating
organizations (Braithwaite 2002; Coglianese and Mendelson 2010), and this is greatly
fostered by opportunities for continuous learning (Koehler 2007).
As Harrow (2006) notes, self-regulation occurs in the ‘‘shadow of the state,’’
which can be protective or menacing, and can work in collaborative or autonomous
ways from self-regulation. Increasingly, the state and non-state responsibilities in
regulation are being joined in new forms of co-regulation.
Co-Regulation: Varying Degrees of Interdependence
Co-regulation refers to regimes in which both the state and the non-state organizations
are involved with at least some common regulatory goals. The specific configurations
may differ considerably, however, depending on the extent to which regulatory targets
and compliance mechanisms are shared and on the degree of coordination or
interdependence of institutional arrangements. At the least interdependent end of this
continuum are dual systems in which government and the sector may intentionally
focus on different ‘‘tiers’’ of regulation (Gilad 2010), for example, with government
focused on the basic tier of fraud prevention and transparency in charitable fundraising
while the sector concentrates on a second tier of governance processes and operational
controls and possibly a third tier of evaluation and readjustment of these processes.
Dual systems may result from a lack of trust in the government regulator or differing
institutional capabilities and abilities to secure compliance, and may be complemen-
tary and thus efficient, or involve considerable duplication.
Meta-regulation, in a narrow sense, is ‘‘enforced self-regulation’’ (Ayres and
Braitwaite 1992, p. 102). For example, a simple, formalized version of meta-
regulation was embedded in England’s Charities Act (2006) which promotes self-
regulation of charitable fundraising but gives the Minister reserve power to step in if
self-regulation fails (Breen 2011; Morris 2010). A broader view of meta-regulation
sees it as a dynamic process through which a regulator induces and steers others to
develop their own internalized self-regulatory responses to public problems while
maintaining considerable control over the direction of the course. The meta-
regulated are expected to ‘‘not only identity risks and devise internal control
systems, but also to continuously evaluate the efficacy of their internal systems and
incrementally improve them in light of this evaluation’’ (Gilad 2010, p. 488; see
Ford 2011; Parker 2007). How government enforces or induces this may occur in
ways that are light touch or heavy-handed, for instance, by providing incentives
through favoured procurement policies, establishing definitional guidance and
specifying the issues it wants addressed or setting outcome targets and performance
816 Voluntas (2012) 23:808–829
123
indicators against which success will be judged (Coglianese and Mendelson 2010;
Gunningham 2009, p. 164). This nested form of regulation often occurs when
government knows the outcomes it wants to achieve, but does not know or cannot
directly control the means to achieve them. While meta-regulation may reduce the
costs of rule-setting and monitoring in the short term, Gilad (2010, p. 502) argues
that it may be difficult to sustain because the costs of assessing the validity of
information provided by the regulated can be high and a substantial investment in
learning systems is needed, as is a stable regulatory agenda that facilitates
incremental learning by the regulator.
At the most interdependent end of the spectrum are hybrid and integrated regimes
in which there is substantial overlap of public and private interests, common
government-sector regulatory goals and targets and the co-production of standards,
monitoring and compliance. Hybrid regimes embrace an intentionally heteroge-
neous arrangement, which may have been formed from a mix of existing and new
components which nevertheless is expected to have a reasonable degree of stability
and longevity.5 Fully integrated regimes may go further in establishing new
regulatory institutions. Such regimes are still quite rare because they depend on
convergence of a number of circumstances including severity of regulatory failure,
public pressures for better outcomes, complex issues that need complementary
approaches and that offer opportunities to ‘‘go beyond compliance’’ (Gunningham
and Sinclair 2010), a substantial level of trust between the sector and the regulator,
capacities within both the regulator and the sector for collaboration, and legal and
political ease of creating and financing new institutions.
The rest of this article examines the unfolding Canadian experiments in the
regulation of charitable fundraising and explores whether they will evolve as a new
hybrid or integrated regime, or exist as dual or meta regulation.
Canada—Multiple Pressures, Twin Tracks
In Canada, the fundraising ‘‘problem’’ to be solved is much less in the public’s face
than in many countries; the practice of campaigning on the streets or door-to-door is
less prevalent than elsewhere, with direct mail, mainstream media, and websites being
the more popular modes of solicitation (Bhagat et al. 2010). While the Canadian public
maintains high levels of trust in charities, they nevertheless want charities to be more
transparent as to what they do with their money (Muttart Foundation 2008). The
revelations that began in 2007 (Donovan 2007) of the abuse of charitable status as tax
shelters, some of which were staggering in their size, generated much greater scrutiny
of the entire sector by the media with frequent reports on prohibitive—and often
inaccurate—fundraising ratios (Blumberg 2011a).6 In addition, the CRA assertively
5 This is a somewhat more restructive view of hybrid than is often taken as some mixes of arrangements
are haphazard and contradictory rather than intentional and complementary.6 A tax shelter can be a legal means of tax avoidance. These gifting arrangements involved questionable
or sham gifts, however, for which investors received tax receipts for amounts that exceeded the value of
the actual donations and little money was retained for use by the charity once the fees of promoters and
related for-profit companies were paid (Hawara 2011). In one type of gifting arrangement, a taxpayer
Voluntas (2012) 23:808–829 817
123
stepped up its auditing to catch the rogues. Since 2007 it has audited all potential tax
shelters resulting in the rejection of $2.5 billion CDN in tax claims for donations
(Hawara 2011) and in revocation of the charitable status of 35 charities and amateur
athletic associations. The concern has not been only with overt fraud, however, as even
well-intentioned charities have been inconsistent in how they treat and report
fundraising expenses, which results in substantial errors on the annual return and
significant under-reporting of fundraising expenses (Ayer et al. 2009).7
The existing relationship between the sector and the federal government onto which
this scrutiny landed was not a particularly constructive one. There is no big vision of or
overarching policy for government’s relationship with civil society. Rather, the legacy
of many years of funding cuts and increased accountability requirements had strained
relationships. The sense that the charitable sector warrants suspicion and greater
government control was heightened further in 2010 when a Member of Parliament
introduced a private member’s bill that would have required disclosure and a cap on
the salaries of the staff of charities (Blumberg 2011b). The unfolding challenge in
Canada, then, is to develop effective institutional arrangements to implement
co-regulation in a somewhat poisoned environment.
From the Practice of Absence to New ‘‘Guidance’’
In comparison to the US, UK, or Australia, Canada has had few rules on charitable
fundraising. Although constitutional responsibility for charities rests with the
provinces, only four of ten have legislation governing fundraising (outside of
gaming), all different and none enforced in any serious way.8 With its responsibility
Footnote 6 continued
donates property at a higher value than its cost, often because it was bought at cut-rate prices offshore and
sold at artificially inflated retail prices. The amount of cash a participant pays is typically 30% of the
amount of the receipted donation (OAG 2010, p. 17). In a leveraged cash donation scheme, a taxpayer
makes a pledge to the charity and might contribute 15% of this in cash: the remaining 85% would be
financed by a non-recourse loan from the promoter (usually with a security deposit paid to the promoter
which is invested to pay the interest and principle of the loan plus a fee); a tax receipt for the total of the
cash and loan is issued. The CRA has disqualified these as gifts, requiring taxpayers to repay the tax
benefit with interest and potentially with additional penalties, and in many cases also determined that the
charities were operated for non-charitable purposes, thus revoking their status.7 Proper reporting of fundraising expenses has been compounded by the absence of standardized non-
profit accounting rules. In Canada, these rules are in transition as new standards adopted by the Canadian
Institute of Chartered Accountants will come into effect on January 1, 2012. Other jurisdictions, notably
Australia, have moved more assertively to standardization. In July 2011, all Australian states and
territories adopted the Standard Chart of Accounts developed by the Australian Centre for Philanthropy
and Nonprofit Studies at the Queensland University of Technology.8 Alberta has been the most directive by requiring registration prior to solicitation (when the attempt is to
rise more than $25,000 CDN or when using a fundraising business) and requiring fundraisers to inform
potential donors of the costs of fundraising relative to the amount to be raised. Manitoba requires
authorization to fundraise and sets some rules but with minimal penalties; Prince Edward Island also
requires charities to register but exempts those covered by the federal Income Tax Act; and Saskatchewan
requires fundraising businesses to register (see Broder and Conley 2010). In 2005, a Uniform Charitable
Fundraising Act was drafted that would introduce and harmonize regulation across the country, but no
province or territory has adopted it. When fundraising involves gaming or lotteries, provinces may license
these under separate gaming legislation, with municipalities licensing small gaming events, pursuant to
the national Criminal Code definitions of legal activities.
818 Voluntas (2012) 23:808–829
123
for the federal Income Tax Act, the CRA is the predominant regulator of charities; it
determines eligibility for charitable status, requires annual reports (available on its
website), monitors and audits charities for compliance, sanctions for non-compliance,
and provides policy ‘‘guidance.’’9 The primary control on fundraising, until 2010, was
the federal ‘‘disbursement quota’’ which required that charities direct 80% of the
previous year’s receipted donations toward their charitable purposes, thereby limiting
the amounts that could be spent on administration and fundraising. The quota was
problematic as it had differential effects depending on the composition of a charity’s
revenues (being more restrictive for charities that are heavily dependent on tax-
receipted donations) and imposed an administrative burden on charities without
necessarily achieving its core purpose (see Bourgeouis 2011). The sector advocated
for and welcomed its elimination in the 2010 federal budget.
The Charities Directorate has traditionally acted as a command-and-control
regulator, and holds a very big hammer of sanction with its ability to revoke
charitable status. Since the early 2000s, it has attempted to act more like a
‘‘responsive’’ regulator, one that puts the emphasis first on education and dialogue
with the regulated sector to change behavior, using compliance and sanction only as
needed (Ayres and Braitwaite 1992; Scott 2004). It has been conducting more
consultation and training and providing more extensive clarification of its
interpretation of the law, although it has not gone as far as the Charities
Commission of England and Wales or the Internal Revenue Service in the US in its
advice giving and support functions (see O’Halloran et al. 2008). In spite of
attempts at relationship building, CRA has been consumed in recent years with its
auditing function in order to gain control over the problem of bogus tax shelters and
improper receipting.10
In 2009, the Charities Directorate positioned itself to address fundraising directly,
rather than through the backdoor of the disbursement quota, when it implemented
(following extensive consultations) new Guidance on Fundraising (CPS 028: CRA
2009). The perspective of the Directorate is that this is not new policy at all; rather it
merely clarifies and makes more explicit—for both charities and internal auditors—
the difference between fundraising and other expenditures and what it has long
expected charities to do in order to ensure they direct substantially all their
resources toward their charitable purposes. The intent of the Guidance is to pull
rather than push charities into compliance, educating them about good and bad
practice and providing greater clarity about the nature of CRA’s concerns. An
alternative view is that the guidance opens the door to new forms of co-regulation.
9 Even Quebec which operates its own taxation system has generally harmonized its recognition of
charity with the federal system although it, too, has recently developed a code of good governance for the
sector. In other aspects of oversight of charities, there is greater fragmentation and lack of coordination
across the country.10 Over several years, the CRA has been given additional audit resources and in the 2011 Budget
received authority to apply tougher standards to amateur athletic associations (which have the same tax
receipting privileges as charities but with more limited accountability and reporting requirements, several
of which were involved in tax shelters). CRA can now refuse to register a charity if individuals with a
history of fraud or abuse of charities are involved in its management or leadership (Minister of Finance
2011). The Budget also indicated that the House of Commons Standing Committee on Finance will be
asked to study charitable donation incentives.
Voluntas (2012) 23:808–829 819
123
Specifically, the guidance defines fundraising conduct that is prohibited11 and
clarifies what constitutes expenditures on charitable activities versus fundraising.
Expenditures can be allocated as charitable activities if substantially all (90%) of the
purpose was other than fundraising or if a four part test can be met, i.e., if the charity
can answer ‘‘no’’ to four questions: (1) was the main objective fundraising? (2) did
the ask involve ongoing, repeated, emotive, gift incentives, or donor premiums? (3)
was the audience selected for its ability to give? and (4) were commission-based or
other payments tied to number or amount of donations? The evaluation of whether
fundraising costs are excessive is done using a grid of fundraising cost to revenue
ratios, even though such ratios have been severely criticized in the literature
(Sargeant et al. 2008; Steinberg and Morris 2010) and they generated serious
concerns in consultations with the sector. The evaluation grid sets out that:
fundraising costs under 35% of revenues annually are unlikely to raise concerns;
over 35% will trigger detailed assessments; and over 70% will raise concerns and
require an acceptable explanation. The guidance recognizes that there may be
legitimate reasons why, in any given year, a charity exceeds the acceptable ratio (for
example, investment in donor acquisition). There is thus considerable effort to
position the ratios as guidelines rather than bright lines, although since the
elimination of the disbursement quota, the evaluation grid may take on greater
significance than initially anticipated.
A third part of the Guidance lays out in considerable detail the ‘‘best practices’’
that CRA will consider ‘‘decrease the risk of unacceptable fundraising’’ (CRA 2009,
s. 10), and, this takes it squarely into involvement with internal governance and
management. The expectation is that charities have:
• Prudent planning processes
• Appropriate procurement processes
• Good staffing processes
• Ongoing management and supervision of fundraising practices
• Adequate evaluation processes
• Good use of volunteer time and resources
• Disclosure of fundraising costs, revenues and practices.
As widely accepted good governance practices, these are not particularly
controversial. The larger question is: what kind of policy instrument do they
represent? Are these new rules, a credible threat, or exhortation for improved
conduct? There are two underlying issues which suggest that the Charities
Directorate is likely to treat them as soft rather than hard law.12
The first is the matter of jurisdiction. ‘‘Standards’’ for the internal operations of
charities would take the federal government into, or at least very near, provincial
11 Fundraising that involves illegal or misleading conduct, is contrary to public policy or an end in itself,
or provides excessive private benefit is prohibited.12 So far, CRA has not been revoking status or sanctioning charities simply for having high fundraising
ratios. The two revocations for excessive fundraising and administrative expenses from January 2010 to
mid-2011 also involved overt deception so as to alter the ratio.
820 Voluntas (2012) 23:808–829
123
territory.13 A constitutional challenge by a provincial government could yet be
triggered, although this seems unlikely as most do not want to actively occupy this
regulatory space. But, it encourages caution by the federal regulator. The other issue
is the capacity of the regulator. To effectively use the guidance as either hard
regulation or an educational tool, the CRA needs to move more emphatically toward
a model of responsive regulation that involves an ongoing dialogue with charities.
Regulating in a responsive manner is more personnel intensive, and would
compound an existing personnel problem. While the Directorate’s audit staff has
increased, the high levels of mobility in the federal public service means that there
are many vacancies in the Charities Directorate, particularly among the lower ranks
but also at the top (there have been eight directors over the past 14 years), and such
mobility is not conducive to deep relationship building.
Finally, the prospect of responsive regulation and involvement in private
governance raises a long debated issue of the need for an independent national
charities commission supported by its own legislation. There is no indication that
the current Conservative government has any interest in major reform of the
regulatory machinery, however. It appears that the new policy statement will
probably do as advertised—clarifying guidelines and pulling charities into better
practice. It also presents an opportunity, perhaps an imperative, for stronger self-
regulation.
A Leap in Self-Regulation: The Sector’s Standards Program
Parallel to the federal government’s interest in good governance, Canada’s civil
society sector has moved toward more effective self-regulation. This did not occur
as steady, incremental progress but more akin to the children’s game of leapfrog
with big strides forward after long periods of inaction. Although collectively
assessed as second largest by employed population in the world (Hall et al. 2005),
Canada’s charities have never seen themselves as an integrated sector; the national
infrastructure organizations have not been particularly strong and were significantly
weakened by many years of cuts to government funding.
The first steps toward stronger self-regulation were taken 15 years ago.
Recognizing the vacuum of policy leadership, 12 coalitions and umbrella
organizations representing the diversity of the sector came together in 1995, calling
itself the Voluntary Sector Roundtable (VSR), to provide greater cross-sectoral
leadership. One of the VSR’s priorities was to make the sector more proactive about
its own accountability, and in 1997 commissioned an independent group of experts,
the Broadbent Panel on Accountability and Governance, to review and make
recommendations in this regard. In 1998, the Canadian Centre for Philanthropy
(CPP, later to transform itself into Imagine Canada) introduced a voluntary Code of
Ethical Fundraising and Financial Management that articulated standards covering
13 The law supplies an interpretation that the CRA can look at how charitable purposes are carried out;
however, the courts have held that CRA guidance does not have the force of law, and there is a paucity of
case law dealing with permissible fundraising conduct by charities. Appreciation to Peter Broder of the
Muttart Foundation for clarifying these constraints.
Voluntas (2012) 23:808–829 821
123
donor policies, fundraising, and financial management practices. The 1999 report of
the Broadbent Panel strongly endorsed the Code and envisaged a hybrid regulatory
regime involving voluntary accreditation by the sector that would be integrated into
government requirements by making maintenance of charitable status conditional
upon adoption and renewal every 2 years of a code of ethical fundraising (if not the
CPP code, one similar in principle) (PAGVS 1999).
For more than a decade, the Broadbent Panel recommendations on self-regulation
went nowhere and the CPP code languished with limited subscription while the
sector’s leadership worked on a collaborative exercise with the federal government,
the Voluntary Sector Initiative (VSI), which ultimately had few long term benefits
for it (Phillips 2011). The engagement of senior CRA staff in the VSI, however, was
the impetus for the series of small but significant regulatory reforms, new policy
directives and relationship building that have moved the agency somewhat in the
direction of being a more responsive regulator. During this period, one of the
leading national infrastructure organizations effectively went bankrupt and CCP
came very close itself; in 2005, the two organizations joined together to become
Imagine Canada. Although the new organization struggled for a while, which
contributed to a hiatus in the development of the fundraising code, it has now
established financial viability and is exerting a national leadership role—albeit still
struggling with a sector that has not been all that keen on being led (Wyatt 2009).
In an attempt to reinvigorate the Code, Imagine Canada, with the support of three
insurance companies, re-launched it in January 2008, with the quiet aim of getting
12,000–15,000 organizations signed on. While still voluntary, the new Code gave
much greater attention to a complaints-based compliance process (Imagine Canada
2008). Only 350 of Canada’s 82,000 registered charities subscribed, although this
includes a considerable number of large organizations and a good geographical mix.
While re-launching the Code, a cadre of charity leaders recognized that the
environment was changing quite dramatically with much greater scrutiny and
expectations of transparency. A voluntary code would not take the sector far enough
fast enough toward credible self-regulation.
In 2006, Imagine Canada (joined by Volunteer Canada and the government-
sponsored HR Council for the Nonprofit Sector) created a 20-member Account-
ability Reference Group to lead thinking about broader standards (see ARG 2007).
Following a national sector summit in 2008, a steering committee of 27 members
was formed to lead the initiative through the next stage of refining the standards
and developing a governance and accreditation process (Standards Steering
Committee 2009). Their July 2009 implementation proposal was again tested and
affirmed with the sector in a second summit, and leaders from across the sector
continued to work on designing a fair, accessible, and transparent process, suitable
to the diversity of the sector and geography of a large country. In 2011, 52
founding members (including the Steering Committee members) each contributed
$2,000 to implement the Standards Program, 27 of which are currently going
through its first pilot. The process is expected to be available for open
participation by charities and non-profits in 2012 and to reach a level of maturity
and sustainability in 4 years.
822 Voluntas (2012) 23:808–829
123
The Standards Program is more than a voluntary code; it is a certification process,
more akin to accreditation in many self-regulating professions than to the existing
fundraising code. While enhancing transparency, it puts a heavy emphasis on
learning through self-assessment and has the ambitious goal of creating a
community of practice to work toward continuous improvement. A secondary goal
is, by showing leadership, to delay further prescriptive government regulation. A
guiding principle is that the initiative is ‘‘owned’’ and operated by the ‘‘sector for
the sector,’’ and is to be self-funded through fees, the support of corporate partners
and continued fundraising.14 An explicit decision was made that it would not seek or
take government funding, which reflects both the desire for sectoral ownership and
the sense of vulnerability produced by years of poor federal funding practices.
The challenge of governance for the certification system was how to create an
independent arm’s length governing body without the encumbrance—and expense—
of heavy new infrastructure while addressing the legal responsibility of Imagine
Canada. This is accomplished by differentiating among the functions of leadership,
operational management, and peer review. Given its legal liability, high-level
leadership and oversight is exercised by the Imagine Canada board which approves the
Program policies, budget, and fees, and sets the terms of reference as well as
appointing three members of an independent 12-member (Provisional) Standards
Council. This Council has functional oversight of the accreditation process, making
recommendations for any changes in policy and procedures to the Imagine Canada
board and rendering decisions on accreditation applications and complaints. It also
appoints peer review committees which will assess and make recommendations on
applications and monitor compliance. Charities and other public benefit non-profits
that wish to be accredited, and thus earn the right to display the hallmark, are expected
to examine their own conformity with the standards over a 3–9-month period, on
which basis they apply to the peer review process, which may include site visits.
Accreditation lasts for 5 years, and compliance is monitored, with the assistance of
Imagine Canada staff, through audits, spot checks (of 3–5%) of participating
organizations and investigation of complaints.
The 89 standards, which are drawn from now widely recognized good practice,
cover five categories: governance (27 standards), financial accountability (8),
fundraising (20), staff management (24), and volunteer involvement (10). Respect-
ing that certain standards are relevant to large but not small organizations, most are
differentiated by three levels: for organizations with less than one full-time
employee (FTE); those with 1–50 FTEs; and those with more than 50 FTEs. The
fundraising and financial accountability standards are comparable to the existing
code which will be fully merged into the Standards Program in 2013. The
comprehensiveness and content of the standards are certainly on the rigorous rather
than the light touch side, and may be regarded by some as a barrier to participation.
14 The three insurance companies that had supported the Ethical Code each contributed a total of
$300,000 CDN over 3 years, and the Initiative has an active fundraising committee. Fees are set on a
sliding scale based on the size of operating budgets; the application fee (paid once and upon renewal
every 5 years) ranges from $400 CDN for an organization with annual operating expenses under
$250,000 to $8,000 for those with expenses over $25 million. In addition, the annual license fee ranges
from $200 to $4,000.
Voluntas (2012) 23:808–829 823
123
The alternative of making participation easy through lenient standards, however,
would have risked a significant compromise of legitimacy in an environment in
which the sector is vulnerable and where good governance practices and norms are
quite widely agreed upon. Indeed, the program seems to have struck about the right
balance.
The transparency and learning components of the Standards Program are being
supplemented by an online collaborative community designed to share leading
practices among participants, training opportunities, and the development of an online
portal, led by Imagine Canada with funding from CRA, which is intended to be a ‘‘one-
stop shop’’ for information on charities, including all the CRA information. It will be
an opportunity for charities to supplement the mainly financial information on the
mandatory annual report with information about their programs, contexts, and
outcomes. While the portal might look somewhat like GuideStar, its proponents are
quick to note it will be distinctive because it will be run by the sector with the intent of
encouraging innovation by enabling charities to ‘‘tell their stories.’’15
Achieving and Assessing Success
The creation of such a comprehensive certification system is a big step for Canada’s
charitable sector which a decade ago could not generate enough interest for a
limited voluntary code on fundraising. Only a few years ago, it would have raised a
variety of objections, most notably that ‘‘standards’’ cannot be imposed on such a
diverse sector. For many observers, then, the biggest (pleasant) surprise of the
standards initiative is the lack of push back from charities. One reason effective self-
regulation may actually move forward at this time is that its proponents recognize
that they cannot look to government for policy leadership. Charities, too, are coming
to realize that they cannot be passive because the regulator is quite prepared for
more rules as it deems necessary and that they need to start acting more like a
mature sector by making better use of their infrastructure organizations.
Getting uptake by the small, independently minded organizations that are the
bulk of this sector will not be easy and most of these will probably never be enticed
to participate. The good news, however, is that the Canadian sector is not dominated
by strong associations which, if unified in resistance, could kill certification very
quickly. Creative use of verticality (e.g., within federations) and supply chains (e.g.,
third party fundraisers as suppliers to charities) could enhance engagement with a
wide range of stakeholders and provide additional motivations for participation in
the Standards Program. A clear lesson from other sectors is that such field building
does not happen without external incentives and financial support, both to maintain
a certification body with adequate governance capacity and to enable other
organizations to generate interest and demand. While the program has the advantage
of having several committed corporate sponsors so that the process does not have to
be sustained from membership fees alone and has chosen, probably wisely, to
remain financially independent of government, there is still much that all levels of
15 Independent watchdogs and charity rating firms have not been successful in Canada, as they have the
US and to a lesser extent in the UK.
824 Voluntas (2012) 23:808–829
123
government and other funders can do to promote its viability. This will take more
than passive grant making, instead requiring coordinated effort and creative
methods such as building incentives into contracting and procurement policies and
working with the sector on learning opportunities.16
It is important that success not be judged primarily, or prematurely, on the basis
of numbers. As Breen (2011) observes the UK experiment with the Fundraising
Standards Board, which was set up under a statutory meta-regulation arrangement,
the requirement that it undergo assessment of its effectiveness in late 2011 when the
initial government seed funding ends has created enormous pressure to use number
of participants as the key measure of success. Because the CRA’s approach to meta-
regulation is a softer touch and the Standards Program has greater financial
independence from government, it can operate more in the manner of a club, giving
it greater latitude to define the terms of its own success. While the extent of take-up
will matter, which organizations participate and their satisfaction with the learning
gained through membership should be as important as numbers alone. The Canadian
leaders have been astute in positioning the program as capacity building and
learning which may go a long way toward crafting appropriate expectations and
indicators. They have also managed a suitable balance in setting sufficiently
rigorous standards that will force charities and non-profits to stretch themselves,
even if it comes at some tradeoff in initial recruitment. Communication to the public
as to why success is not simply a numbers game will be critical, however.
Success of the Standards Program could be as beneficial for government as for
the charitable sector. Along with the line departments that operate grant and
contribution programs and central agency that oversees them, CRA is interested in
making regulation more risk-based. Realistically, CRA will be able to examine, at
least in any detail, the governance systems of only a very small percentage of
charities. Certification by the Standards Program could thus usefully become one
consideration in its monitoring and audit processes. As the program evolves,
acknowledgment by CRA of its value and clarification of how it will treat
certification could give the program an important boost and, indeed, should be
expected in the interests of transparency.
It is much too early to tell if certification will succeed in Canada’s civil society
sector. Unquestionably, the challenges are significant and this is new territory for the
lead infrastructure organizations. The initiative has gotten off on the right foot,
however, by framing the problem not just as donor empowerment or transparency, but
as continuous improvement and creating a community of good practice for and by
charities. The fact that the stakes of not succeeding are high, given that government has
signaled with its guidance on fundraising that it will be paying much more attention to
good governance, means that there is no turning back at this stage.
16 The option that funders require accreditation as a criterion for grants and contracts is a strong but
complicated incentive as it imposes the cost of club membership on grant recipients or contractors. While
complicated, the issue of how funders can assist in creating incentives for certification needs a fuller
discussion.
Voluntas (2012) 23:808–829 825
123
Conclusion: The Future for Co-Regulation?
The regulation of charitable fundraising is no longer just about the regulation of
fundraising. Rather, fundraising is increasingly understood as the product of
governance systems, and its regulation is being integrated into broader regimes for
the promotion of good governance. This entails refocusing the target of regulation
from a more informed donor, through provision of information about fundraising
ratios, to a well-performing charity and a more empowered charitable sector,
equipped with incentives that embed good governance norms in strategic self-
interest for improvement. The focus on charities rather than donors more
realistically deals with the market failures of dependence on third party for-profit
fundraisers with unreasonable fees or commissions and of highly speculative
practices because it promotes use of the challenge function of governance to
question, and avoid, such practices. It also dispenses with the growing fiction, given
the changing technology of fundraising, that governments can enforce rules on a
geographic basis.
The 2009 Guidance on Fundraising gave the Canadian regulator new tools to
more directly shape how charities govern themselves, and the comprehensive
certification system being implemented by the sector, if successful, will compel
charities to be more assertive in assessing and improving their governance,
management—and fundraising—systems. The two mechanisms have initially been
set on dual tracks: the tax agency focussed on dealing with the extremes of bad
practice, as caught through fundraising ratios and using questions about good
governance systems as guides in auditing, and the sector working on a second tier of
improving governance and management processes and building a learning-based
community of practice. Given scandals over tax sheltering, CRA needs to
demonstrate that it deals with abuses in a timely way, although its enthusiasm for
using the guidance as hard law for directing the internal operations of charities is
modulated, in part, due to jurisdictional constraints. A robust enforcement presence
is only a small part of an effective and responsive regulatory regime, however. The
regulator also needs to develop its own capacities for institutional learning that
allow it to ‘‘channel, understand, and respond to change’’ (Ford 2011, p. 32). That
said the most important task in the short run is to facilitate the development of a
credible mechanism of sector certification, thereby strengthening the charitable
sector and its relationships with various stakeholders (including the regulator),
meeting public expectations of transparency and enabling it to be a serious player in
a potentially more interdependent regime in the future.
To a limited degree, an interdependent regime may develop over time. The value
of the guidance as soft meta-regulation or as part of a hybrid regime may increase as
the sector’s certification system is fully implemented and as a risk-based approach
to regulation is used more extensively across governments. Certification can be an
efficient means of triage in assessing risk, and certification could be recognized by
the CRA as a sign of risk mitigation. Formalization of its use in this manner would
provide a valuable benefit to the implementation of the Standards Program, and
coordination with other departments and funders to establish additional incentives
could reinforce complementarities to create a hybrid regime that encourages greater
826 Voluntas (2012) 23:808–829
123
dialogue between the regulator and regulated, enabling both to better understand
and respond to change. In the absence of an independent charity commission and
separate legislation, however, the possibilities for a fully integrated regime,
involving co-production of regulation and new institutional arrangements, are
necessarily constrained because a tax agency cannot delegate its statutory
responsibility for tax-related matters.
The value of the evolving Canadian experience is that it impels us to rethink the
goals and targets for attempting to regulate charitable fundraising at all—which is
essential given that technology has radically changed the means and geographic
scale of fundraising so that conventional rules seldom work, if they ever worked
well. The regulatory debate needs to leapfrog from the micro-regulation of
fundraising to the complex challenges related to regulation of and by private
governance. What is clear is that governments are in the discussion about the
accountability of private governance to stay, and, civil society sectors need to figure
out how they can be serious players in new forms of self- and co-regulation since
their governance has become a matter of public policy.
Acknowledgments Appreciation to Peter Broder of the Muttart Foundation for detailed comments on
an early draft of this article and Myles McGregor-Lowndes and participants at the Reforming Fundraising
Regulation Conference hosted by the Centre for Philanthropy and Nonprofit Studies, Queensland
University of Technology for further ideas.
References
Accountability Reference Group (ARG). (2007). Can standards help charities to achieve their mission?
A Discussion Paper, Imagine Canada, Toronto.
Auld, G., & Gulbrandsen, L. H. (2010). Transparency in nonstate certification: Consequences for
accountability and legitimacy. Global Environmental Politics, 10(3), 97–119.
Auld, G., Gulbrandsen, L. H., & McDermott, C. L. (2008). Certification schemes and the impacts on
forests and forestry. Annual Review of Environmental Resources, 33, 187–211.
Ayer, S. M., Hall, M. H., & Vodarek, L. (2009). Perspectives on Fundraising: What charities report tothe Canada Revenue Agency. Toronto: Imagine Canada.
Ayres, I., & Braitwaite, J. (1992). Responsive Regulation: Transcending the deregulation debate. Oxford:
Oxford University Press.
Barber, P. (2011). Regulation of charitable solicitations in the United States of America. Paper presented
to the conference on Reforming Fundraising Regulation, Centre for Philanthropy and Nonprofit
Studies, Queensland University of Technology, Brisbane, Australia, April.
Bartley, T. (2007). How foundations shape social movements: The construction of an organizational field
and the rise of forest certification. Social Problems, 54(3), 229–255.
Bernstein, S., & Cashore, B. (2007). Can non-state global governance be legitimate? An analytical
framework. Regulation & Governance, 1, 347–371.
Bhagat, V., Johnston, M., Persaud, S., Bickford, D., & Willis, J. (2010). The next generation of Canadiangiving. Toronto: HJC, Convio and Stratcom.
Bies, A. L. (2010). Evolution of nonprofit self-regulation in Europe. Nonprofit and Voluntary SectorQuarterly, 39(6), 1057–1086.
Blumberg, M. (2011a). CBC report on Canadian Cancer Society—thoughts on transparency, media
Bothwell, R. O. (2000). Trends in self-regulation and transparency of nonprofits in the U.S. TheInternational Journal of Not-for-Profit Law, 2(3):604–622. http://www.icnl.org/knowledge/ijnl/
vol2iss3/sg_1.htm. Accessed April 2, 2009.
Bourgeouis, D. J. (2010). Eliminating the disbursement quota: Gold or fool’s gold? The Philanthropist,23(2), 184–189.
Braithwaite, J. (2002). Rewards and regulation. Journal of Law and Society, 29(1), 12–26.
Breen, O. (2009). Regulating charitable solicitation practices—the search for a hybrid solution. FinancialAccountability and Management, 25(1), 115–143.
Breen, O. (2011). The perks and perils of non-statutory fundraising regulatory regimes: An Anglo-IrishPerspective. Paper presented to the Conference on Reforming Fundraising Regulation, Centre for
Philanthropy and Nonprofit Studies, Queensland University of Technology, Brisbane, Australia,
April.
Broder, P., & Conley, L. (2010). Fundraising by registered charities: the basics, Slides for a Webinair,
Charity Central, March 24. http://www.charitycentral.ca/node/6. Accessed June 1, 2010.
Cashore, B. (2002). Legitimacy and the privatization of environmental governance: How non-state
market-driven (NSMD) governance systems gain rule-making authority. Governance, 15(4),
503–529.
Coglianese, C., & Mendelson, E. (2010). Meta-regulation and self-regulation. In R. Baldwin, M. Cave, &
M. Lodge (Eds.), The Oxford handbook of regulation (p. 1079). Oxford: Oxford University Press.
Donovan, K. (2007). Charity scams bust public trust. Toronto Star, June 2. http://www.thestar.com/News/
article/220756. Accessed August 15, 2007.
Flack, T. (2004). The mandatory disclosure of cost of fundraising ratios: does it achieve the regulators’
purposes? Working Paper No. CPNS26, Centre for Philanthropy and Nonprofit Studies, Queensland
University of Technology, Brisbane, Australia.
Ford, C. (2011). Macro and micro level effects on responsive financial regulation. University of BritishColumbia Law Review, 44. Available at SSRN: http://ssrn.com/abstract=1773098.
Gilad, S. (2010). It runs in the family: Meta-regulation and its siblings. Regulation & Governance, 4,
485–506.
Gulbrandsen, L. H. (2005). Explaining different approaches to voluntary standards: A study of forest
certification choices in Norway and Sweden. Journal of Environmental Policy & Planning, 7(1),
4–59.
Gunningham, N. (2009). The new collaborative environmental governance: The localization of
regulation. Journal of Law and Society, 36(1), 145–166.
Gunningham, N., & Sinclair, D. (2010). Integrative regulation: a principle-based approach to
environmental policy. Australian Centre for Environmental Law, Australian National University,
Canberra. Available at SSRN: http://ssrn.com/abstract=212608, doi:10.2139/ssrn.212608. Accessed
March 11, 2011.
Hall, M., et al. (2005). The Canadian nonprofit and voluntary sector in comparative perspective. Toronto:
Imagine Canada.
Harrow, J. (2006). Chasing shadows? Perspectives on self-regulation in UK charity fundraising. PublicPolicy and Administration, 21(3), 86–104.
Hawara, C. (2011). What’s new at the Charities Directorate? Presentation to the charity and not-for-profit
law seminar, Ottawa, February 15. http://www.carters.ca/pub/seminar/chrchlaw/ott/11/ch0216.pdf.
O’Halloran, K., McGregor-Lowndes, M., & Simon, K. W. (2008). Charity law and social policy. London:
Springer.
Office of the Auditor General (OAG). (2010). Report of the Auditor General of Canada to the House ofCommons. Ottawa: Office of the Auditor General.
Panel on Accountability, Governance in the Voluntary Sector (PAGVS). (1999). Building on strength:improving governance and accountability in Canada’s voluntary sector. Ottawa: Voluntary Sector
Roundtable.
Parker, C. (2007). Self-regulation and the not-for-profit sector, Legal Studies research paper 372,
University of Melbourne Law School, Melbourne.
Phillips, S. D. (2011). Incrementalism at its best, and worst: Regulatory reform and relational governance
in Canada. In S. D. Phillips & S. Rathgeb Smith (Eds.), Governance and Regulation in the thirdsector: International perspectives. London: Routledge.
Potoski, M., & Prakash, A. (2009). Voluntary programs: A club theory perspective. Cambridge, MA: The
MIT Press.
Prakash, A., & Gugerty, M. K. (2010). Trust but verify? Voluntary regulation programs in the nonprofit
sector. Regulation and Governance, 4(1), 22–47.
Sargeant, A., Jay, E., & Lee, S. (2008). The true cost of fundraising: Should donors care? Journal ofDirect, Data and Digital Marketing Practice, 9(4), 34–53.
Scott, C. (2004). Regulation in the age of governance: The rise of the post-regulatory state. In J. Jordana
& D. Levi-Faur (Eds.), The politics of regulation. CRC Series on Competition, Regulation and
Development. Cheltenham: Edward Elgar.
Sidel, M. (2005). The guardians guarding themselves: Comparative perspectives on nonprofit self-
regulation. Chicago-Kent Law Review, 80, 803–835.
Sidel, M. (2010). The promise and limits of collective action for nonprofit self-regulation. Nonprofit andVoluntary Sector Quarterly, 39(6), 1039–1056.
Sloan, M. F. (2009). The effects of nonprofit accountability ratings on donor behavior. Nonprofit andVoluntary Sector Quarterly, 32(2), 220–236.
Standards Steering Committee. (2009). A proposal to implement voluntary standards of excellence in
