Charity Transgressions, Trust and Accountability

Abstract

Abstract This research demonstrates how sustained charity fraud is supported when organisations do not develop strong accountability links to salient stakeholders. Whilst increased regulation is one response to reduce charity fraud and to increase organisational accountability, regulators seldom recognise the myriad heterogeneous needs of stakeholders. This research explores the tactics employed by beneficiaries and the donating public to escalate their accountability demands on such charities. By preferring the most powerful stakeholders, charities miss the opportunity to design effective processes to discharge accountability to meet their moral obligations to legitimate stakeholders. This article calls for increased ‘stakeholder understanding’ by charity governors as a policy to recognise the moral rights of these stakeholders and to reduce charity transgressions.