News & Events
Governance, compliance and fundraising update for charities
24th November 2025
Charities are preparing for a period of significant change across governance, compliance and fundraising. Updates to the Charity Governance Code, new obligations under the Economic Crime and Corporate Transparency Act, and a shifting fundraising landscape mean that trustees and leadership teams must stay alert to evolving standards. From strengthening internal controls to adapting digital fundraising approaches, organisations will need to ensure their frameworks and practices are fit for purpose in an increasingly regulated environment.
Charity Governance Code update
A revised version of the Charity Governance Code was published in Autumn 2025, following a sectorwide consultation in 2024. The update aims to reflect evolving best practices in governance, including diversity, digital transformation, and environmental responsibility as well as a focus on accessibility, proportionality and removing barriers to use. The new code will provide clearer guidance on trustee responsibilities, board effectiveness, and stakeholder engagement. Charities are encouraged to review their governance frameworks in anticipation of the changes and consider training for trustees to align with the updated standards. Strong governance remains a cornerstone of public trust and regulatory compliance, and the revised code will support charities in navigating complex operational environments.
Economic Crime and Corporate Transparency Act
The Economic Crime and Corporate Transparency Act (ECCTA) introduces new compliance requirements for charities and charitable companies, including mandatory ID verification for trustees and directors. In addition to the extant Corporate Liability for Senior Managers offence (brought into effect in 2023), which introduced the possibility of criminal liability for charities of any size if a senior manager of the organisation commits an offence under ECCTA, as of September 2025 an additional Failure to Prevent Fraud offence exists for large charities (defined as those with two of; turnover > £36m, balance sheet > £18m, >250 employees).
Under the new provisions of the legislation, an organisation can be held liable if a person ‘associated with’ the charity commits fraud (such as misappropriation of public funds or money laundering offences) with a view to benefitting either the organisation or somebody closely associated with it. Similarly, new provisions of ECCTA brought into place as part of its Companies House reform program will have an effect on charitable companies or subsidiaries of charities needing to file financial statements with the public registrar. Beginning in spring 2025, there is now a requirement for company directors, or trustees or agents looking to file financial statements or otherwise interact with Companies House on behalf of a company, to verify their identity. The registrar also now has the option to reject or challenge filings which appear suspicious or contain errors, as well as annotate the register to highlight relevant information to the public. The latter could include disqualifications under sanctions law, non-compliance notices or details of strike-off proceedings.
These measures aim to enhance transparency and prevent misuse of charitable structures for illicit purposes. The Act also increases scrutiny of charity trading subsidiaries and strengthens governance expectations. Charities must ensure that their leadership teams are prepared to meet these new obligations, which may involve updating internal policies and systems. Similarly, charities must carefully review their anti-fraud measures and, importantly, ensure that an anti-fraud culture is embedded throughout the entity as a compliance failure in this area could result in penalties or even loss of charitable status. The Act underscores the importance of robust governance and due diligence in maintaining sector integrity.
Fundraising
Fundraising Income Outlook
Despite economic challenges, the Charity Pulse Report from events platform Enthuse estimates that 60% of charities remain optimistic about fundraising prospects in 2025. Growth is expected in corporate giving, individual donations and legacy giving, driven by renewed public engagement and strategic campaigns. Charities are leveraging digital platforms and storytelling to connect with donors and demonstrate impact. However, competition for funds remains intense, and organisations must differentiate themselves through transparency and innovation. Building long-term donor relationships and investing in fundraising capacity will be key to sustaining income. The outlook suggests cautious optimism, with opportunities for growth amid ongoing financial pressures.
Fundraising Code of Practice
The new Fundraising Code of Practice, effective 1 November 2025, marks a significant shift in UK fundraising regulation. Rather than listing prescriptive rules, the revised code adopts a principles-based approach, focusing on core values: legality, openness, honesty and respect. This makes the code more adaptable to emerging fundraising methods, such as online gaming and social media campaigns.
One of the most notable changes is the streamlining of content – the code is now substantially shorter, making it easier to navigate. It also places greater emphasis on ethical behaviour, including avoiding intrusive or persistent fundraising tactics and ensuring donor protection, especially for vulnerable individuals. Oversight of third-party fundraisers has been strengthened, with clearer expectations around due diligence, written agreements and ongoing monitoring.
Importantly, the code now requires charities to take reasonable steps to protect fundraisers from harm or harassment. While the legal framework remains unchanged, the new code increases accountability and encourages better governance. Charities and their advisers are urged to review internal policies and ensure staff and volunteers are trained to meet the updated standards.
Digital fundraising and AI adoption
Digital fundraising continues to evolve, with charities increasingly adopting AI tools for donor targeting, grant writing and campaign automation. As it stands, the 2024 Charity Digital Skills Report estimates that 41% of charities rate themselves as poor at digital fundraising, but there is growing recognition of its potential to enhance efficiency and reach. AI can help personalise donor engagement, optimise resource allocation and improve decisionmaking. Data analysis can also give greater visibility and insight into fundraising trends, helping to identify better ways to engage with potential donors and key demographics, whilst a better understanding of the digital ecosystem in general (including use of new and social medial platforms) is paramount for staying in touch with younger demographics and staying relevant in the digital age.
However, implementation requires investment in technology and skills, which may be challenging for smaller organisations. The report identifies a key resource gap, with 64% of smaller charities identifying themselves as being at an ‘early’ stage with digital adoption, as opposed to only 26% of larger charities. Whilst it’s clear that access to digital expertise can be a game changer, trustees will need to balance the need to invest with their responsibilities as stewards of charitable funds in order to achieve best value and ensure funds are deployed appropriately.
Charities should explore partnerships and training opportunities to build digital capacity and ensure ethical use of AI. Accountants, auditors and other advisers should consider how they can add value through both digital expertise and experience with related governance issues. Embracing digital innovation will be crucial for future fundraising success but, as with all technological advances, governance will be key to ensuring successful adoption.
Charity specialists
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