I have been contacted by a small number of charities and individuals who are dealing with the issue of a board member donating to the freedom convoy and how to deal with it. This is a situation where an individual used their own personal funds donated to the convoy and did not use charity funds which would be a much worse and more serious issue. I also asked people on Twitter to send me some of their thoughts that I have included later on, whether I agree with them or not.
The first thing is that there is no one size fits all approach. The facts matter. A human rights group in Ottawa may see the situation differently than an evangelical church in Northern Saskatchewan. A private foundation with all the funds being provided by one family may see the situation differently than a fundraising charity that requires broad-based public support. A charity that receives extensive government support may see the issue differently than a charity that does not receive government support.
As well, it matters when the donation was made. A donation a few weeks ago is probably not as bad as a donation made after the convoy had reached Ottawa and been there for a number of days and it was much clearer what the convoy stood for. A donation to GoFundMe is different than a donation to GiveSendGo, which was only set up after GoFundMe cancelled the fundraising campaign because it violated their terms of service.
A charity that deals with say health policy and is in favour of the mandates may have more concerns than perhaps a charity that advocates zealously for freedom. A charity that has mainly BIPOC beneficiaries may have greater concerns that their credibility may be undermined than a charity that has few or no BIPOC beneficiaries.
The amount of the donation also matters, at least to some. I have often heard but it was only $10 or $50. For many, the amount will not matter that much because it is indicative of supporting the convoy, whether it is a large amount of support or not. People have lost their positions on boards and officer position for a lot less than making a donation to an objectionable group. For example, liking or retweeting an objectionable tweet can end your role as Chair of the Board of a university. Head of UBC board of governors resigns after liking far-right comments on Twitter. In fact, a large institution can lose tens of millions of dollars in donations and funding if it has a public relations disaster.
Some people have commented that many of the people that we know donated to the Freedom Convoy, we only know that because of an illegal hack. This may be true. They may be uncomfortable using information obtained in that manner. On the other hand at this point, whether a person’s donation has been discovered or not, probably a board member, who is a fiduciary of the charity has a duty to disclose this information to the charity immediately and not wait for someone to discover it or to tweet about it.
Some commented that it is important to see how the person responds to the issue. Are they very apologetic, etc? Certainly seems like it could be a relevant factor in some circumstances, especially for earlier smaller donations.
Most of the comments I have received essentially can be summed up as ‘this is a simple issue and the board member should be gone in 5 minutes’. They may be correct but I think that with 86,000 charities in Canada it may also be more complicated than that.
Other comments were more nuanced:
Hi Mark, if a director of a charity donated to the convoy, they should either apologize sincerely or be removed. If, by very slim chance, they didn’t see the written intent to overthrow the government and they weren’t aware that some (most?) organizers were openly affiliated with far-right hate groups, then an apology is owed. Otherwise, nothing can justify aligning with such a “movement” if someone has a fiduciary responsibility to a charitable organization in Canada, and they should be removed. There can be no middle ground on intolerance and it must be called out at every level. One benefit to the protests and occupations is that racism and radicalization was so overtly on display that there can be no denying it. It needs to be confronted by all rather than carried alone by our minority and racialized communities.
So every charity is going to have to think about how to deal with this issue. Thankfully, many charities are not going to have to deal with this issue at all. None of their board members will have donated to the Freedom Convoy.
There will certainly be charities that will look at the situation and it will be quite clear to them that if someone’s on the board who’s donated to the Freedom Convoy they need to have the person resign from the board. Despite some of the language that I’ve seen that people are being forced off the board or that it’s a witch-hunt or that it’s a human rights abuse to remove them for “free speech”, people generally don’t have a right to be on a Board of Directors of a registered charity. They are supposed to serve the charity and they owe a fiduciary duty to the organization.
A few years ago, we updated our sample board code of conduct to include a paragraph such as this dealing with social media. Some of the same principles apply here although one can argue that a poorly structured or insensitive tweet is less harmful than a donation to a group carrying out an illegal protest and “mischief” in Ottawa and at a number of border crossings.
The Charity recognizes that the internet provides unique opportunities to participate in interactive discussions and share information on particular topics using a wide variety of social media, such as Facebook, Twitter, Instagram, LinkedIn, Pinterest, Reddit, blogs, micro-blogging sites, YouTube, content communities, chat rooms, bulletin boards and wikis. The Charity acknowledges that social media use by directors is a normal activity in their personal lives.
However, directors’ use of social media can pose risks to the Charity. These risks may include damage to the Charity’s reputation, unauthorized disclosure of the Charity’s confidential information, and unauthorized disclosure of personal information of donors, funders, staff, or members of the Charity.
In using social media, directors must remember that their actions online may affect the Charity. Directors’ actions or statements through social media, whether those made through the Charity’s social media accounts or through personal accounts, that harm the interests of the Charity, or that result in a breach of the directors’ fiduciary duties to the Charity, may be grounds for removal in accordance with the Charity’s by-laws.
We thought that it’s important to emphasize that even something as simple as tweeting a tweet when you are on the Board of Directors, or hold a senior position in a charity, could have negative impacts on the charity.
Many of the people who donated to the Freedom Convoy are quite used to the situation that we have in Canada where there is almost no transparency when it comes to certain types of donations or fund transfers. They had expected that when they made that donation that if they wanted no one would know about it. Because of a security breach at GiveSendGo, the list of the donors, or at least a very large number of them, was disclosed to the public.
In many cases when a director’s name has been released to the public, this isn’t going to be some big fight. Some donors will realize that giving money to the Freedom Convoy may not have been a good idea, it was done a few weeks ago and certainly with hindsight being 2020 was not a good idea. They will probably offer to the charity that they will provide the resignation forthwith if the charity would like that. They certainly don’t want that a members meeting will have to be called to kick out the individual or a board meeting depending on what the bylaws provide.
There will be others who are proud of their donation and not willing to back down. The charity may decide not to force the person off the board, but it could have some significant repercussions for the charity including some donors may shy away from the charity, government may cut funding or they could be negative media publicity both for the charity and for the donor. If the director cares about the charity, this will be very painful for them. For some other charities perhaps where a lot of the members and directors are supportive of the Freedom Convoy, the donation may not be seen as a big issue.
Keep in mind that despite the Emergencies Act, extensive media coverage, etc., there are still people who believe they were just supporting a “peaceful demonstration” by “protesters” in Ottawa that was opposed to mandatory vaccination mandates. They are not “aware” of the incessant noise, fumes and intimidation suffered by people in Ottawa, nor some of the far-right symbolism displayed and drawings of nooses on the side of trucks, nor some of the more objectionable comments by organizers about them not leaving until the government is replaced. So, unfortunately, it will not be an easy conversation for some charities. Unfortunately, charities in Canada do sometimes have to deal with difficult conversations, although they sometimes don’t do it well and just capitulate to whatever the major donor wants! This may be a little different.
In other cases, when the donor doesn’t back down, the charity may be forced to take the necessary steps to remove the individual from the board. This could include calling a board or members meeting depending on the corporate act and provisions in the articles and by-laws. This may be very embarrassing for the director and cause damage to the charity. However, it may cause for some charities less damage than allowing the director to stay on.
There is clearly no one-size-fits-all when it comes to this issue.
About four days ago I tweeted on Twitter:
Over the next couple weeks there will be some resignations of directors of Canadian charities because of donations to the Convoy. www.charitydata.ca/search/director Here is the only list of directors of Canadian registered charities as they were in 2019.
I’ve always said that one of the biggest mistakes a director makes in dealing with a Charity is overstaying their welcome.
Some people view being on the board especially in some ethnic organizations or religious communities as being an important honour. Sometimes that honour in their minds takes precedence over the fiduciary duty that the Director has to the organization.
Hopefully, there will not be too many charities that will have to deal with this issue. I can certainly imagine that many charities will be asking additional due diligence questions of new board members such as “Did you have any financial or other links to the Freedom Convoy? Did you participate in any way in the Freedom Convoy?”
By Mark Blumberg, Blumbergs, Canadian Charity Law
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