Alice Hulbert


Jim Clifford


Trustees are at the heart of all charities, but how do they keep these charities ticking ?  Looking across all the charities we guide on challenges and opportunities related to governance, here are four challenges that come up time and again, with some ideas as to how to tackle them.

Which of them can you see in your own charity ?

1. Do it yourself

We don’t just want to be Trustees ‘closeted’ in a Board room. Trustees want to help.  It’s why they got involved in the first place. That’s almost always welcome, but has some pitfalls.  The Executive and staff operate the charity, and Trustees govern it.  Think ‘strategic’. Don’t let your enthusiasm run away with you and start trying to run the show directly.  If you are in a position to help on the delivery side, you are doing that as a volunteer, and need to take the lead from the charity staff who run it.

2. Incorporation or not ?

A charity doesn’t have to be a company (or the new-ish form – the CIO – incorporated under the Charities Act).  Charities are much older than company law, and the simplest forms of trust just involve individuals, alone or in associations.  That’s fine, but has some drawbacks: if the charity gets into financial trouble, the trustees are personally liable for losses.

This can be worrying for trading charities who might feel the pressure or drift towards incorporation. An example, is a large choral society, selling tickets to the public, with the liabilities that come with trading with the public.  It’s not difficult to incorporate, particularly with the Charities Act CIO as a new form, so take a look, and take advice if you’re not sure.

3. Balancing risk and risk taking

How many times do we come across Boards too risk-focused to get anything done?  Particularly since the COVID lockdowns and the financial crises, charities have needed to be ever more flexible and agile to make a difference.  Trustees should identify the big risks and avoid or manage them, but the charity is there to get things done, not sit in the corner quivering with fear.  Identify and watch the risk – yes – but also embrace the opportunities, which may mean taking some risk!  We’ve seen Boards gaining greatly from good conversations about risk appetite – how brave do we want to be ?  That re-sets your thinking into a positive vein whilst still avoiding your leading the charity blindly over a cliff.  Try it !

4. That’s a good question…

We’re seeing many Boards tussling with what they are meant to be doing.  It’s great to engage and discuss, but to what purpose ?  When it comes to a more challenging matter that needs a decision, too often Boards skirt around the problem, or all take their turn to speak, not listening to each other and then not building a collective view.

With thanks to Nancy Kline and her Time to Think books, ‘Good Questions’ (she talks about incisive questions) are really useful.  For example, the Chair examines the topic, and then sets between one and three questions he or she wants the Board to answer.  An example we’ve encountered was a charity that had had a breakdown in accounting and financial control.  The Chair set the following questions to give the Board focus: ‘Do we believe the accounts presented ?’ and ‘Is management’s proposal to fix the problem enough?’  That avoided unproductive or divisive discussions, and focused everyone on the real issues.

To finish our whistlestop tour, let’s give you three bits of direct guidance that we mention to most Boards we encounter:

  • Quickly spot and don’t fall for urban myths – ask someone who knows. ‘Sillies’ like ‘you must hold six months’ expenditure in reserves’ (not true as such) are all out there – ask yourself whether it’s right and whether it makes sense for your charity.
  • Charity Commission and other guidance doesn’t always match what is said elsewhere. Guidance and standards are updated, but not necessarily at the same time, so you’ll find mis-matches.  Look at the dates of the guidance, and take an intelligent approach to how to apply it….and again, ask if you’re not sure.
  • ‘You have two ears and one mouth’ says the old saying. You need to listen to others in the Board room, and not just the sound of your own voice.

Trusteeship is both an exciting challenge and a joy.  Do get involved and help – working together, with purpose –  whether with a local concern or a National Charity is incredibly valuable.  Don’t fall for excuses like ‘I’m too old/young’, ‘I don’t think I have anything to give’ or ‘I’ve not been a trustee before’.  You will surprise yourself.

Let us know if these comments have resonated with your experience, and tell us what you’re encountering.  In fact, why not get in touch to continue the conversation.

Published On: November 8th, 2023Categories: BlogBy

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