How cause marketing works in Australia, a legal guide

What cause marketing is

Cause marketing is a campaign in which a business attaches a social cause to its products or promotion. Usually that means a partnership with a charity or not-for-profit: a set amount or percentage of each sale is donated, a product is given away for every product sold, or the campaign simply aligns the brand with a cause its customers care about. The idea has been around for decades, but it has picked up pace as more Australian consumers say they prefer spending with businesses that do good.

The commercial logic is simple. The campaign gives customers a reason to buy that has nothing to do with price, and the charity gains funding, awareness and reach. The legal logic is less simple, because a cause marketing campaign sits at the intersection of three areas of law at once: state and territory fundraising regulation, the Australian Consumer Law, and the charity framework run by the Australian Charities and Not-for-profits Commission (ACNC). Each layer has its own triggers, paperwork and consequences, and a single poorly worded advertisement can breach two of them at the same time.

This article explains how the whole scheme fits together: the players involved, the stages a campaign passes through, where campaigns typically go wrong, and when professional help is worth the money. The trigger point to remember is simple. From the moment your campaign solicits donations for a charity in connection with selling goods or services, both state fundraising law and the consumer law are engaged, and the paperwork obligations start before the first advertisement goes live.

The players: who does what

Four groups of people make up a cause marketing campaign, and the law treats each differently:

The business: You run the promotion, and state law gives you a specific label. In New South Wales, s 11 of the Charitable Fundraising Act 1991 (NSW) calls a business that conducts a fundraising appeal in connection with its trade a trader. In Victoria, a business retained to administer an appeal is a commercial fundraiser under the Fundraising Act 1998 (Vic).
The charity: The charity is the beneficiary, and usually the party that holds the legal permission to fundraise. It must be registered with the ACNC to operate as a charity in Australia, and it may also need a separate state authority, which is the point we come to in stage 1.
The regulators: State consumer affairs agencies administer fundraising law, including NSW Fair Trading under the Charitable Fundraising Act 1991 (NSW) and Consumer Affairs Victoria under the Fundraising Act 1998 (Vic). The ACCC enforces the Australian Consumer Law nationally, and the ACNC regulates the charity itself.
The consumer: Customers are the audience whose trust the campaign monetises. Every layer of the law described below exists to protect that trust, because a donation promise is usually something a consumer cannot verify before buying.

Stage 1: Check that the charity can lawfully fundraise

State fundraising law is what most businesses miss, because there is no single national fundraising licence. The law that applies depends on where the campaign runs.

In NSW, s 11(1) of the Charitable Fundraising Act 1991 (NSW) provides that a person must not conduct a fundraising appeal in connection with the supply of goods or services in the course of any trade or business, or otherwise partly for that person's benefit, except in accordance with the section. The maximum penalty is 200 penalty units. "In accordance with the section" means, among other things, that the appeal must be conducted jointly with a person or organisation that holds an authority to conduct the appeal (s 11(2)(a)). In practice, the charity must hold a current authority to fundraise in NSW and your campaign runs under it. If it does not, the campaign cannot lawfully run in that form.

This is why the first step is due diligence on the charity, not creative work on the campaign. Ask the charity for its ACNC registration details and, if the campaign will run in NSW, for a copy of its fundraising authority. ACNC registration is not the same thing as a state fundraising authority, and neither guarantees the other.

There is a third check if you intend to promote donations as tax-deductible: the charity needs deductible gift recipient (DGR) status endorsed by the ATO. A registered charity is not automatically a DGR, so do not assume it. The tax treatment of cause marketing arrangements has its own subtleties, which a tax adviser can map for your specific structure.

Stage 2: Put the partnership in writing

Under s 11(2)(a1) of the Charitable Fundraising Act 1991 (NSW), the trader and the authority holder must enter into a written agreement that complies with the requirements of the regulations. The regulations may prescribe matters the agreement must cover (s 11(2A)(a)), so the agreement is not a courtesy; it is a statutory condition of running the campaign in NSW.

At a practical level the agreement should settle:

how the donation is calculated, whether a fixed amount per sale or a percentage of revenue or profit, and when it is paid;
whether the amount is a guaranteed minimum or a proportion of profits, because that affects what you must disclose to consumers at stage 3;
which party holds the fundraising authority and who is responsible for complying with its conditions;
insurance and liability for the campaign, including who covers the risk if the campaign causes loss;
what happens if the campaign is suspended or the authority is cancelled.

In Victoria the mechanics differ. A business does not hold an authority; instead, s 17A of the Fundraising Act 1998 (Vic) requires the person conducting a fundraising appeal to be registered as a fundraiser with the Director, and the appeal must be conducted in accordance with the details given on registration. If a registered fundraiser retains a commercial fundraiser to administer the appeal, s 24A requires written notification to the Director within 28 days of entering into the retention agreement.

Stage 3: Disclose in every advertisement

Disclosure is where the campaign meets the consumer, and the NSW Act is specific about it. Under s 11(2)(b), every advertisement, notice or information concerning the appeal must identify the trader and the holder of the authority. Under s 11(2)(c), it must give details of the intended distribution of funds raised, or of any guaranteed minimum payment or proportion of profits to be paid by the trader.

So if the deal is that 15% of the profit on every pair of jeans goes to the charity, the advertisement must say so. If the deal is a guaranteed minimum of $10,000, the advertisement must say so. A campaign cannot be built on a slogan like "a percentage of every sale supports the charity" when the percentage is buried in an agreement the customer never sees.

Victoria reaches the same result through a different rule. A commercial fundraiser that seeks donations by way of communication must disclose that it has been retained on a commercial basis (s 15 of the Fundraising Act 1998 (Vic)), so the customer knows the person asking for money is being paid to ask.

Stage 4: The Australian Consumer Law overlay

The fundraising acts regulate the mechanics of the campaign. The Australian Consumer Law (the ACL) regulates the claims. The ACL is Schedule 2 of the Competition and Consumer Act 2010 (Cth), and two provisions matter most for cause marketing.

First, s 18(1) provides that a person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive. This is the general provision that catches a campaign promise that does not match reality, such as claiming to donate 15% of profits when the real figure is 5%.

Second, s 29(1) prohibits false or misleading representations, including that goods or services have sponsorship, approval, uses or benefits (s 29(1)(g)), or that the person making the representation has a sponsorship, approval or affiliation (s 29(1)(h)). This is the section that catches a claimed partnership with a charity that does not really exist, or an affiliation that is far thinner than the marketing suggests.

The penalties concentrate the mind. For a contravention of s 29, s 224(3) of the ACL caps the pecuniary penalty for a body corporate at the greater of $100 million, three times the value of the benefit obtained from the conduct, or 30% of the company's adjusted turnover, and at $2.5 million for an individual. The ACCC can also issue substantiation notices requiring the business to prove its claims. A cause marketing claim is not marketing puffery; it is a representation that must be true and provable.

Oscar Wylee shows what a false promise costs. In 2020 the Federal Court ordered eyewear retailer Oscar Wylee to pay $3.5 million in penalties for misleading or deceptive conduct and false or misleading representations about its charitable donations and affiliations. Between January 2014 and December 2018 the company told customers "buy a pair, give a pair" and that it donated a pair of glasses to someone in need for every pair purchased. In fact it sold 328,010 pairs of glasses and donated 3,181 frames without lenses, roughly one set of frames for every 100 pairs sold. It also claimed a partnership with the charity Rose Charities when its entire association consisted of a single $2,000 donation and 100 frames in 2014.

Grill'd shows where the ACCC's attention sits now. In June 2026 the ACCC commenced proceedings in the Federal Court against Grill'd over its Tree Day Tuesday promotion. The ACCC alleges Grill'd represented that it would donate $1 from every burger purchased on a Tuesday towards planting trees, when only a small percentage of Tuesday purchases actually qualified because of detailed conditions that were not disclosed, or not adequately disclosed. According to the ACCC, more than five million burgers were bought on Tuesdays between January 2021 and April 2024 but only around four per cent of those purchases qualified for a donation. The case is ongoing and Grill'd has not been found to have breached the law, but the allegations are a clear warning about conditions that qualify the promise and the duty to disclose them.

Where the traps hide

The enforcement record points to six recurring failure points:

Conditions that qualify the promise: The Grill'd allegations turn on the gap between the headline promise and the conditions that narrowed it. If a donation only applies to certain products, channels, membership levels or payment methods, the conditions are part of the claim and need to be disclosed where the claim is made.
Affiliation claims: The Oscar Wylee case shows that "we have partnered with X charity" is a representation of affiliation under s 29(1)(h). A one-off donation in 2014 did not support an ongoing partnership message, and a $3.5 million penalty followed.
One-off generosity dressed as an ongoing partnership: If the arrangement is a single payment, the campaign message must match it. Ongoing claims need ongoing transfers, and the written agreement should say how often they happen.
State-by-state variation: NSW runs on authorities, Victoria on registration, and the other states and territories each have their own fundraising laws. A campaign that advertises nationally should be checked in every state where it runs, because the failure point in one state is enough to stop the whole campaign.
Ongoing compliance: In NSW the authority holder must give a written statement each financial year confirming it has taken reasonable steps to comply with the Act, the regulations and the conditions of the authority (s 24B), with a maximum penalty of 50 penalty units. That obligation sits with the charity, which is one more reason for a written agreement that allocates responsibility for it.
Tax deductibility: Donations are only tax-deductible if the charity has DGR status, and a registered charity is not automatically a DGR. The ATO also only treats a transfer as a deductible gift where the donor receives no material benefit in return, so offers that attach a discount or product to a "donation" need to be structured carefully, with advice.

When a lawyer earns their keep

A lawyer adds value at three points in a cause marketing campaign.

Before the campaign starts, a lawyer can verify the charity's fundraising authority and its ACNC and DGR status, draft the written agreement between the business and the charity, and map which state laws apply to a campaign that runs across borders. This is the cheapest point to get advice, because the structure is still flexible.

Before the advertisements run, a lawyer can review the claims against s 18 and s 29 of the ACL and check that every qualifying condition is disclosed in the advertisement itself rather than left for the website's fine print. That review is measured in hours, not weeks, and it is where most enforcement exposure is eliminated.

If things go wrong, a lawyer manages the response to an ACCC substantiation notice, an enquiry from a state regulator, or a penalty proceeding, including negotiating enforceable undertakings with the regulator. Getting involved at the enquiry stage is far cheaper than defending proceedings that have already commenced, and the Oscar Wylee and Grill'd matters show that the ACCC treats cause marketing claims as a priority.

Start with the paper trail, not the slogan

The pattern across the enforcement actions is consistent. Businesses invest in the creative promise and treat the paperwork as an afterthought, and the result is a claim that cannot be substantiated and conditions the consumer never saw. The trust that makes cause marketing work is also the asset a regulator can take away. The cheapest insurance is the sequence this article sets out: confirm the charity's authority, sign the written agreement, disclose the numbers in the advertisement, and keep the records that prove the donations actually happened. That work is a few hours with a lawyer at the front of the project, not a large bill, and it is what separates a campaign that builds trust from one that ends up in a penalty judgment. For a business weighing its first cause marketing campaign, a short consultation to check the structure before committing is small compared with the cost of getting the promise wrong.