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10 Practical Steps to Streamline Your Charity's Governance

on Tuesday, 16 March 2021.

As some of us return to offices and other workplaces after the third lockdown, many charities are responding to calls that they 'build back better'.

Trustees and managers are being pressed to take advantage of the enforced pause of lockdown to refocus their charities in a way that better addresses wider societal priorities.

We have written elsewhere on how trustees can make sense of such demands while respecting the requirements of charity law. In this article, we focus instead on practical steps you can take to improve the governance of your charity. Good governance is a subtle, multifaceted art and embedding it takes time.

We have identified 10 straightforward ideas to get you started.

1. Review Your Governing Document

A charity's governing document should be reviewed periodically to ensure that it remains up to date with current law and recognised good practice in governance, and that it remains fit for your purposes. The review can be completed informally during a board meeting, or through a more extensive process with input from professional advisers. This is an opportunity for trustees to remind themselves of the governing document's content and consider whether strategic changes, such as those prompted by the pandemic, mean that change is needed. It is also an opportunity to catch up with developments in good practice, such as the soon to be announced review of the Charity Governance Code.

2. Remote Working

We have seen a surge in electronic meetings. Some charities have had to hold such meetings without the usual constitutional authority during lockdown. As we emerge from lockdown, there is an opportunity to ensure your governing document allows meetings to be held by electronic means and contains clear procedural rules, including those on notice, quorum, participation and decision making. Where individuals are working from home, you should be conducting appropriate risk and needs audits, including health and practical aspects of home working and cyber security. For practical guidance, see our recent article, 'Returning to the Workplace - Where Should Charities Start?'.

3. Management Information

With major strategic decisions being made and operational circumstances changing frequently, it is important that trustees have the information they need to govern effectively. Delivering such information can be challenging for organisations which have been used to using paper based systems. 

4. Delegation

Many charities have had to make substantial changes to staffing while the availability of trustees and other volunteers has forced changes to committee structures and roles. This is an opportunity to review the interaction of trustees, the Senior Leadership Team and committees, ensuring there are clear and up to date terms of reference and role descriptions, and avoiding duplication.

5. Communications

For similar reasons, this is a great time to review the frequency and medium of communication to maximise efficiency and (in conjunction with clear delegation and other items in this list) enable effective governance.

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6. Reporting

Both operational changes and the fact that during lockdown many staff and trustees were more readily available than ever before have prompted changes to reporting needs. How and how often should reports be delivered? It may help to develop a template board report to encourage disciplined consideration of why a report is commissioned, whether it is for information or decision, how it fits with the charity's strategy, its urgency, its implications (operational, financial), and other relevant considerations.

7. Board Administration

The charity's secretarial role in ensuring that routine regulatory filings, minutes, reporting, and other administrative tasks run smoothly is crucial, but often overlooked. Why not update or create a calendar of key annual events and requirements, making sure that a named person has responsibility for the main tasks?

8. Training

The lockdown period has seen a succession of changes to law and guidance. At the same time, the rigours of lockdown and the ongoing uncertainty have left many people feeling disconnected from colleagues. Training for trustees offers an opportunity to address both these issues. A well-structured training session can ensure that trustees have an up to date understanding of their legal duties and the legal requirements relevant to them in the context of your charity. It also provides an opportunity to bring people together and encourage the informal interaction that often enables honest communication and underlies effective decision making.

9. Professionals

Many of the considerations above also apply to the specialist professionals whose advice will help inform decision making. Have you kept them informed of developments at the charity? Keeping advisors informed and aware of significant developments at an early stage is an exercise in risk management - it will make it easier for them to highlight areas where advice may be needed and for you to seek advice in a timely way. In our experience, this 'little and often' approach to engaging with professionals is usually more cost effective in the long run.

10. A Governance Health Check

Many of the items listed above rest on an up to date understanding of the legal and regulatory environment as well as the charity's governance arrangements. To ensure that trustees are updated systematically and that any gaps in the charity's governance arrangements are addressed equally systematically, it can be helpful to have an annual review of key areas, with different areas being prioritised each year.

Preparing For the Future

A review of the above issues should help you ensure that your charity is equipped to demonstrate good governance as we emerge from a period during which many charities have been forced to take a pragmatic approach to aspects of governance. The law has been relaxed in some areas, and the Charity Commission has been willing to take a flexible and pragmatic approach to regulation. It will also equip you to tackle the difficult decisions which many charities will face over coming months.

For specialist advice on reviewing your organisation's governance arrangements, please contact Chris Knight on 07468 698 954, or your usual contact in the Charity team. Alternatively, please fill in the form below.

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