European Transparency Codex (ETC)
The European transparency codex has been adopted by the European Donations Seal on March 28th, 2011. Eventual changes and additions will be discussed and suggested by the commission of the European transparency codex. The European transparency codex is a solid component of the European Donation Seal awarding procedure, and has to be accepted by all organizations requesting the seal.
A) Requirements for Structure- and Procedure Organization
The responsible persons’ performance tasks, extent of responsibility and authority to decide are described unambiguous and clear. Apart from the constitution, an agenda may be established in order to further execute existing guidelines of procedure.
The directorate and the management will inform the general assembly and, if provided, the supervising body comprehensively and on a regular base. That way, all possible risks as well as any problems regarding strategies, business development and planning are communicated. The administration is supposed to create an appropriate risk control system. The addressed councils oblige to efficient, responsible-minded and professional acting. Work delegation ensues within the experience and competence of the executing person.
B) Proper use of funds
The use of funds is oriented towards the goal of the constitution; corruption and wasting funds has to be prevented. The organs of the bearers of the seal are to prevent conflicts of interests. Already existing conflicts of interests are to be revealed within the scope of fair reporting. The regulations of the German law of associations shall be a guideline for the bearers of the seal. Seal bearers who act in a form of organization deviating from that of a German association shall also adopt the guidelines of the German law of associations in their work processes. With deviant organizations, statutory organs are to be implemented in the acting, replacing the role of the general assembly.
C) General Assembly
The general assembly is inherently dominating. It decides about changes in the constitution and determines the constitution itself. It also elects the treasurer. The general assembly shall congregate at least once per year. Subscription fees are to be pinpointed in the general assembly. The directorate, or the replacing organ, works on its own responsibility. The number of determining persons shall be three at least. Whether there will be a manager and/or a treasurer is decided by the general assembly. A full-time manager should be employed and subject to social insurance contributions. Invoicing of managers is to be avoided.
The seal bearers are obliged to report comprehensively, openly and truthfully about all structurally caused situations. The public and the sponsors of the organization must be able to gain insight in topics regarding fundraising, project-related work, public information and management. Seal bearers provide information willingly, and discuss with sponsors and other interested parties. Questions by donators regarding information are answered friendly and immediately. Furthermore, the organization should not be captious about empowerment and contribution offerings by third parties.
Sealbearers spend funds on management and advertisement to the extent of it being necessary and reasonable. The smart application of funds encourages good results in the areas of donation advertisement and transparency. Sealbearers should be able to operate fundraising in a professional way. Most of all, fundraising should be credible and trustworthy. When choosing a possible external fundraiser, an essential aspect should be reliable and serious service. Pledges for donations should always regard the cost-versus-benefits-factor. The organizations know that fundraising requires a proper budget in order to increase donations. The autonomy of the organization must be preserved. It is the sole responsibility of the organization and its representatives how to execute the advertising for donations. Fundraising methods have to be serious.
E) Activities report
In the activities report and/or on the internet page of the organization, executed projects and activities as well as applied methods and job instructions are to be disclosed in detail. All data is to be published on the internet page of the organization. Detailed information regarding the wages of the responsible persons as well as all expenditure resulting from the cooperation with agencies or consultants and other third party contractors are to be revealed to the European donations seal. Other aspects of the activities report are guided by the requirements of the responsible financial authorities.
F) Administration cost
Sealbearers have to put effort into limiting the administration- and advertising cost to what is necessary. They apply available and entrusted funds according to the guidelines of a prudent businessman. Control mechanisms should be introduced by the treasurer. The executive board commits itself to making decisions based on thorough decision-making bases. The payment of the employees – including the payment of the decision makers – shall be determined with regards to the earnings. To reach the organization’s goals efficiently, qualified personnel is to be recruited. The wages of the personnel shall be market-conform with the rates within the free enterprise economy.
Extent and method of the billing should take the needs of the organization into account. Especially bigger organizations shall compile their annual accounts in terms of commercial law. Sealbearers who support independent partner organizations shall realize that the supported organization have to accommodate for the needs of the donators and supporters.
H) Self-Commitment regarding applications
The applicant is obliged to accept and follow the European transparency codex.