The implications of the Scottish independence referendum could be far reaching for the charity sector and guidance issued this summer by the Office of the Scottish Charity Regulator (OSCR) makes it clear that charities can and should take part in the debate.
The guidance issued by OSCR makes it clear that a charity is permitted to take part in the referendum debate if the charity can demonstrate that in doing so it is advancing its charitable aims and objectives and that any engagement in the debate (which might include the lobbying of Parliament) is not prohibited by the charity's constitution. In addition, charities must not advance any one individual political party, as the advancement of party politics is prohibited under Scots charity law.
A critical consideration for charity trustees in any decision, including whether or not to participate in the independence reference debate, is whether they can be said to be acting in the charity's best interests and with the relevant standard of care and diligence. In making clear their views either way in relation to the independence referendum, charity trustees must have regard to the interests of the charity in the widest sense and that includes the possible impact on the charity's reputation amongst its members, donors, supporters and beneficiaries.
It is clear from OSCR's guidance, and from the general duty placed upon charity trustees always to act in the best interests of the charity, that there should be discussions at charity board level on what the result of the referendum might mean for individual charities, and whether or not any particular outcome of the referendum should be supported or even commented on by the charity.
In considering the impact of any position statement on donors and other funders, charities are likely to feel the need to be sensitive to the views of donors and will not wish to alienate any particular sector of their supporters in making a public statement. Nevertheless, charity law expects charity trustees to act independently and only in the interests of the charity rather than the interests of any one particular funder. OSCR's guidance states that"as long as your charity can maintain its independence and demonstrate party political neutrality in its activities, accepting funding alone should not pose a problem."
In this context, it is important for charity trustees to remember that funding from a local authority or from the Scottish or UK Governments is not a funding arrangement with an individual political party and is a legitimate arrangement with central or local government.
Charity trustees are entitled, in their own individual capacity, to express their own individual views on the subject of Scottish independence, but in doing so they should make it clear that they are not speaking on behalf of any charity of which they are trustees.