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How Partnering With Charities Could Land Your Business in Hot Water With the ACCC

In an era of such transformative social change, more and more businesses are choosing to align themselves with charitable organisations or causes. Whether that be through donations or the facilitation of programs, businesses of all kinds are stepping up to give back.

So how can giving back become a legal headache?

This month the ACCC instigated proceedings in the Federal Court against eyewear brand Oscar Wylee for alleged misleading or deceptive conduct, and making false or misleading representations regarding its charitable donations.

Oscar Wylee’s Deceptive Misconduct Case

Over a period of almost five years, Oscar Wylee made claims on its website, above the line advertising and digital channels that they would donate a pair of glasses to someone in need each time a pair was sold. On investigation, the ACCC found that only 3,000 pairs of glasses were in fact donated, despite the company reporting over 320,000 sales during the relevant period.

The company also claimed to have partnered with Rose Charities to help build sustainable eye care programs in Cambodia. It was later discovered that the brand’s only affiliation with the charity was a one-off $2000 donation in 2014.

“These alleged false or misleading claims presented Oscar Wylee as engaged in significant charitable activity, and exploited consumers’ desire to support charitable causes. Instead, we allege Oscar Wylee donated less than 1 per cent of the glasses it said it would,” said the ACCC.

Consumer Deception

The ACCC explains that businesses failing to follow through on claims that they’re supporting charitable of societal causes falls under deceptive misconduct. In the case of Oscar Wylee, the ACCC notes that customers may have chosen Oscar Wylee over another eyewear brand, with the assumption that their purchase would contribute to those causes named by the company on their website and advertising.

Companies failing to honour their claims of donations are simply enjoying a PR kick-back, without delivering on their promise to customers – or the charities they claim to be partnered with.

How Can You Avoid Deceptive Misconduct

Businesses partnering with charities to enforce positive change is a great thing, and it’s these organisations that have the power and the budget to make a real difference. If you’re considering aligning your business with a charity or initiative, make sure you have the scope to follow through on your claims before publicly announcing the partnership.

You have a duty to your customers and your audience to honour your claims of supporting those in need. Failing to do so can land you in trouble with the ACCC, and find you subject to fines and an infinite amount of negative press.

If your business is engaging in charitable donations, affiliations or partnerships, ensure you retain sufficient evidence to substantiate your donations in line with your public-facing communications on the incentives.