The historic Charity Pot donations made to two groups, including Women’s Place UK, have understandably raised further questions from our staff, which were not covered in the original company statement that addressed this situation. In response to your questions, shared through Lush EBT, we aim to provide more context and answers here.
We are incredibly sorry that, despite all the checks and balances, these two donations slipped through our vigilance, and attempts to keep abreast of all areas of campaigning and current issues. As we become the company we want to be, we aim to build on an equitable and diverse business that is welcoming, inclusive and safe for our Trans colleagues and wider Trans community.
The History of Charity Pot
When we launched Charity Pot in 2007 we felt that we could fill a gap in charity funding by making our grants available only to small groups and charities – the type that work at community level, are run mostly by volunteers, or activist groups who self-organise around pressing and current issues. We decided that:
- Groups need to have an annual income of less than £250,000.
- It is not an essential requirement that groups are registered as charities.
This opened up our funding to groups that, for example; usually find it difficult to gain outside funding; new groups who spring up to campaign around a current issue or situation; groups that are too small to afford charitable status; and volunteer led groups that fund from their own pockets and are thus limited in what they can do.
With this approach, we can distribute a high number of lower value grants to lots of amazing causes around the world. A little money goes a long way in the hands of individuals who can get things done on a shoestring and who are passionate, well informed and extremely dedicated. Using these principles, over the years we have donated millions of pounds to thousands of organisations, and funded things that no other business would touch.
We chose to go down this more difficult route of funding multiple groups and causes, and whilst it spreads the funding widely across smaller good causes, it also increases our exposure to mistakes.
The Administration and Assessment of Charity Pot applications
By funding more groups the risks for mistakes are also multiplied, and therefore the oversight and admin burden on our system is higher than the usual business model of charitable giving (where a company typically chooses one single well known charity to focus all their donation towards). We discussed this increased risk at the outset of Charity Pot, but decided that the risk of mistakes is worth taking if it means we can get money out to all the unseen, underfunded and overlooked organisations out there.
Of course, our aim was and continues to be ensuring we have everything in place to minimise the chances of mistakes ever happening, and we have been considerably successful in this. We have operated Charity Pot for over ten years, and given to thousands of amazing causes, with only an unfortunate few grants proving problematic. The system we have in place has proved robust, but there is always room for improvement and evolution. We have through the years taken legal advice from a variety of law firms, asking them to look at our charitable grants processes and the type of causes we fund, in order to give us a view of where any risks might lie.
To date we have given over £60 million in small grants to more than 13,000 groups globally.
The process a grant application has to go through
The assessment process consists of five stages, plus a follow up outlined below.
Firstly, there are the underlying rules of Charity Pot which applicants have to read to ensure that both their organisation and their project are eligible. The criteria can be found here.
If the group decides they meet the criteria, then the second stage is to fill in a very detailed application form giving us information about their organisation, including:
- What their long-term goals are.
- What they think they contribute that other groups do not.
- A detailed description of the particular project they are applying for funds for.
- A detailed budget breakdown of how the money would be spent, and what would be achieved by the project.
- Details of two independent people as referees who can vouch for their organisation.
The applications are looked over by the Charity Pot team, who assess whether the application meets the criteria. The Charity Pot team plays an active part in supporting the application process, by contacting groups to work with them to identify and complete any gaps or mistakes in their applications – we are dealing with small groups here, not slick multi-million pound charities that have professional fund raising departments, so we try to help as much as possible to get the best representation of the group and project, taking a role as gatekeepers between the groups and the company.
The process of administering the Charity Pot is time consuming and involves lots of liaison with the charities and organisations, as well as with the decision making panels and also working with the shop teams on oversight of Charity Pot parties. The Charity Pot team also have to organise funds being transferred, and ensure legal administrative tasks are completed.
The application is then put before a Charity Pot panel. The panel looks at all the current applications and has to decide which, if any, will get funding. The panels are made up of people from within Lush with an interest or expertise in the respective areas. There are three panels to match the funding categories of Animal Protection, Human Rights, and Environmental Protection. For example, the Human Rights panel has historically been made up of between 3 to 5 people.
Each panel member will read through all the current applications and complete any necessary background research, such as looking at the group’s website or social media accounts, if they have them. The panel members will each take notes in preparation for regular meetings that take place where the panel discuss, exchange notes, and make a final collective decision on whether to grant the application.
As a general rule we have many more applications than we can afford to fund, so sadly there are winners and losers. Applications from groups are declined by the panels for a number of potential reasons; because we cannot see enough reassuring background information about the group, or because we have funded lots of similar projects and groups, etc,etc. Of course, because Charity Pot is open for applications year round with the Fund being allocated continuously, the money available in the Charity Pot Fund is only as big as our current sales at that time (not just during the pandemic) – and unfortunately because of this, sometimes good work will have to be passed over, due to not currently having enough money in the fund to grant every application in front of the panel at that moment in time. We always try to grant money to as wide a spread of causes as possible, to ensure that it is not dominated by single issues.
We try to keep the identity of the panel members confidential in order to protect them from any potential lobbying pressure from groups, as well as shielding them from any potential backlash when people are disappointed when funding applications are unsuccessful. Independence and freedom to make decisions is really important as part of the decision making process and the panel must use their judgement by taking many, many things into account.
The final stage of the application falls once again to the admin and people skills of the Charity Pot team who have to let the declined groups know that they have not been successful this time and answer any questions they may have about this. For groups who have been selected for funding by the panels, the team has to phone up their two referees and have a conversation about what they know of the group, the individuals and the work they do. If the referees give a good reference, the next stage is liaising with Accounts to get money transferred, whether this is local or international.
Groups are asked to send us updates on how the Charity Pot grant was spent and whether the planned outcomes were met and the project successful. The Charity Pot team also chases this information, to ensure transparency, accountability and success of our funding decisions.
We do not publish the internal discussions of the panels, but to be as transparent as possible, back in 2017 there were concerns raised regarding the panel’s gap in knowledge of wider societal problems that jeopardise Trans rights. Because of discussions around Trans rights issues, and the hostility Trans people were and are facing, the Charity Pot team sought out better representation and expertise, and were lucky enough to work with a knowledgeable Trans team member who transferred from Retail on a year’s secondment to the Charity Pot team. That very successful year came to an end just after the coronavirus lockdown, in the middle of 2020. Bolstering the teams and panels with diversity, inclusion and representation in mind is still very much a priority, and further appointments are planned.
As a campaigning company we are held to account by the public and social media more than your average company. We know this can put extra pressure on those of you manning our customer service channels and on our shop floors, especially when the public directs their concerns at you. We take our responsibility to you seriously and try to ensure that you are not having to answer for our decisions or mistakes. We are sorry that this issue has rebounded onto you.
Our Charity Pot system holds up to scrutiny in most circumstances, but we are committed to continuous ongoing improvements to ensure it progressively evolves with an evolving world.
We hope you can remain proud and confident of the work Charity Pot does. We do not take mistakes lightly nor underestimate the hurt that people experience when they are let down by something they love. We always aim to admit our mistakes and do all we can to improve.
If you have any specific suggestions that you would like to share to help us do better and be the company we want to be, we would really love to hear your suggestions. Please send them to [email protected]
We hope this answers some of the further questions you have raised. Thank you for reaching out through the Lush EBT to share your opinions and ideas with the business. Your voice is invaluable in helping us to do better.