• Careers
  • Contact Us

Why Is Transparent and Accountable Governance Important?

on Friday, 10 July 2020.

The Charity Commission has published a regulatory alert serving as a reminder to all charities about meeting the core challenges of charity governance.

The alert is addressed to large charities whose management structure includes trustees and an executive leading front-line staff who work with beneficiaries.

The guidance sits in the context of the Charity Commission's experience of governance failings in charities, explains a covering letter from the Commission's Chief Executive. The guidance itself leads with broad themes of communication and effective oversight by trustees. Many of the particular risk factors highlighted by the alert - structural complexity, rapid growth, complex projects, restructuring, merger or economic difficulties - could be particularly relevant departure points for added scrutiny by charity leaders of their governance, in the wake of the social and economic changes brought by coronavirus (COVID-19).

The alert makes specific recommendations for trustees including:

  • having and regularly reviewing a process for identifying, escalating and managing risk
  •  having committees with the right skills, the right terms of reference and the right lines of responsibility to manage the trustees' diverse workload
  • having an accessible and transparent complaints process

Unusually for Charity Commission guidance, it also includes advice addressed to charity executives. Guidance to the executive focuses on safety assurance generally, assurance issues dealing with third party suppliers and also internal reporting to trustees and learning from incidents.

Perhaps more unusually, the alert contains guidance, principally on safeguarding issues, addressed to the charity as a whole. As well as policies and training, it talks about proper records and resourcing, about culture and management lead as well as having clear safeguarding procedures and lines of escalation with third parties.

The key messages then are keeping people safe and the trustees' responsibility for doing so, by having - a clear understanding of the charity's business; clear lines of reporting and responsibility; and the expertise, resource and capacity to deal with these issues.

Coronavirus charities blogs

These messages are also a reminder to all trustees of the wider piece of which they are part.That wider piece is not just about large, complex charities and not limited to the fundamental need to keep people safe, but about all the work of every charity. It is the fundamental challenge of effective oversight in charity governance, ensuring trustees have the right level of effective control over every aspect of their charity's work, given their responsibility for it.

Across all of the charity's work, we recommend that trustees regularly ask:

  • Are we receiving the right amount and quality of regular, timely information to understand risk and performance?

  • Do we have the expertise in the charity's operations and the capacity critically to assess the information we are receiving in order to identify issues, gaps, weaknesses, trends or themes?

  • Do we have the expertise and management tools available address risks and issues as they identify them?'

These are key questions to test the effectiveness with which you steer the organisation and see the road ahead.

The Commission promises to follow-up on implementation of the regulatory advice in its alert with a sample of its recipients. It is likely to regard any failing to follow the advice as being of serious regulatory concern. Each charity which has received the advice directly should certainly work through its recommendations, documenting at each step how the recommendation is implemented. For other charities, there is likely no lesser expectation on your governance. Governance and keeping people safe are equally important, whatever the size and scale of your charity.


If you need legal support with your charity governance, please contact Andrew Wherrett in our Charities team on 07787 746 721, or complete the form below.

Get in Touch

First name(*)
Please enter your first name.

Last name(*)
Invalid Input

Email address(*)
Please enter a valid email address

Telephone
Please insert your telephone number.

How would you like us to contact you?

Invalid Input

How can we help you?(*)
Please limit text to alphanumeric and the following special characters: £.%,'"?!£$%^&*()_-=+:;@#`

See our privacy page to find out how we use and protect your data.

Invalid Input