[PRESS RELEASE] Cak Budi Donation Case: Organizer Ignores Rules and Ethics

[PRESS RELEASE] Cak Budi Donation Case: Organizer Ignores Rules and Ethics

As an institution that gives special attention to philanthropic activities or social generosity in Indonesia, Filantropi Indonesia (FI) looks at the polemic and controversy surrounding the management of donations made by Cak Budi, which has been widely discussed in the media. FI believes that this case could have an impact on donor trust of philanthropic / non-profit institutions and could hinder the further development and progress of philanthropy in Indonesia. However, this case can also be an instigator of reform and learning for individuals, communities and philanthropic / non-profit institutions that are currently conducting community donations.
Filantropi Indonesia appreciates and supports the initiative of individual, community and philanthropic / non-profit institutions in mobilizing donations and other forms of donation in order to address social issues and advance the public interest. However, in order for these initiatives to continue to gain public support and confidence, and provide optimum benefits and impacts, FI encourages that the donation, management and distribution of donations be conducted in a professional, transparent and accountable manner by referring to all applicable regulations and the philanthropy code of ethics of Indonesia.
In response to the polemic surrounding the donation of donations initiated by Cak Budi, FI considered that there are several aspects or provisions of law and ethics that are not observed and obeyed by Cak Budi, causing the current controversy in the community. These include:
  • The use of private accounts that are vulnerable to mixed donations with personal funds and transactions, and makes it difficult for public control and monitoring
    
  • Transparency and accountability regarding the use of donations. Managers never submitted the use of donations for the purchase of cars and telephones, and only informed authorities after public questioning.
    
  • Unacceptable use of operational funds, both in terms of quantity and allocation. Using large amounts of donations for the purchase of cars and mobile phones categorized as "luxury" is considered unethical and contrary to prevailing regulations.
    
  • Managers do not pay attention to their capacity to raise funds so that the amount of incoming funds is not proportional to the number and capacity of managers. Managers do not try to solve this problem through synergy and partnership with social institutions.
    
  • Use of donations that are inconsistent with the program or activity being promoted. Social donations dedicated to a particular program or social activity may not be used or transferred for the purchase of cars or mobile phones. Changes in the allocation of donations must only be made with consent from the donors.
    
  • The manager does not have a permit. The raising of donations for internal and religious activities is possible without permission. However, if the donation raising targeted the public at large and involves funds of up to hundreds of millions of rupiah, it requires permission from the relevant agencies to be controlled and supervised.

In order to subdue the current controversy, and to protect the rights and interests of donors, FI recommends that the Cak Budi donation fundraising activity be suspended for evaluation and improvement. Learning from this case, Philanthropy Indonesia recommends a number of conditions to be observed and adhered to by individuals, communities and donation-raising agencies, so that such problems do not reoccur in the future:

1. Contribution donors should observe and comply with the rules regarding the contribution and philanthropy code of ethics (Law No.9 / 1961 on Money and Goods Collection, Government Regulation No. 29/1980 on the implementation of donation collection, Indonesian Philanthropy Code of Ethics, Mediamassa Philanthropy Code, etc.).

2. Donors should not use personal accounts, but have designated accounts for donations. Individuals and communities who do not have a special account are advised to work with a philanthropic / non-profit institution that is able to keep a special account of the donation so that its activities are assured accountability and do not violate any applicable regulations.

3. Donors should pay attention to, and comply with, the provisions concerning operational funds that are set forth in law or philanthropy code of ethics.

4. Donors should pay attention to their personal and organizational capacities, and should not force themselves to manage excessive donations. Managers can overcome this problem by synergizing with philanthropic institutions or non-profits that have shown prior competence and accountability. Indonesian philanthropy also calls on the community as a donor to be more sensitive, selective and critical in channelling donations and preferring to channel donations to the proven philanthropic institutions.