Recent figures from the Charity Commission has shown a record number in registered charities now at 164,345 with revenues of £63 billion a year. This has led to a demand in more people to volunteer and become trustees in charities, the custodians of the charity and its legal remit.
The London Daily News interviewed the Chief Executive of Cause4 Michelle Wright a social enterprise launched in May 2009 to support charities, social enterprises and philanthropists in development and fundraising across the charity, arts, sports and educational sectors in the UK and internationally.
Michelle Wright Chief Executive of Cause4
Can you explain the exact role of a trustee in relation to a charity, what does a trustee do?
Charity Trustees have specific legal responsibilities including ensuring that a charity is solvent and well-run and that it delivers charitable outcomes for public benefit. Overall Trustees must act in the best interests of the charity and the people that it exists to support.
Have you seen in recent times more young people get involved in the management of charities?
There is certainly an appetite for more young people to get involved as Trustees, but often a lack of information about how they can get involved. This is an issue that we are aiming to address through the Close Brothers Trustees leadership programme. According to the organisation Young Trustees, young people are hugely under-represented on charity boards. Despite 18-24 year olds representing 12% of the total adult population, only a fraction of this age group 0.5% are charity Trustees in England and Wales. Out of a total of over 810,000 trustees in England and Wales, only 4,220 are aged under 24.
What are the requirements for someone to be a trustee?
Most people over 18 years of age can become Trustees, but a few are not eligible, particularly if they have been disqualified as company directors or have been convicted of an offence involving dishonesty or deception. People who receive benefits from the charity may also be ineligible.
How transparent are the workings of trustee meetings? Are they required to provide a clear account of how decisions are made?
All Trustee meetings are minuted and formal records of meetings signed by the Chair as an accurate record of the discussions that took place. Many charities will make minutes available on public record, for example, the British Council. It is good practice that key points from a Trustee meeting are shared with the wider executive team running the charity, and that all stakeholders are aware of the key decisions and strategic direction of a charity.
What is the relationship between trustees and the management of the charity? Can the management or the committee of the charity exert influence of the trustees?
When it works well, the relationship between the Trustees of a charity and the Chief Executive can be a generative and creative partnership. Trustees are principally responsible for governance and the Executive for running the organisation. Managing the relationship between CEO and Chair is key. Like any relationship it needs to be a partnership – building trust, respect and understanding. The management of the charity cannot exert influence on Trustees, but it is the role of the CEO to ensure that Trustees are as well-informed as possible to be able to carry out their governance and legal responsibilities, and to approve decisions put forward by the Executive in the best interest of the charity and the public benefit.
If someone in London wanted to be a trustee of a charity how can they do this?
Volunteering first with a charity to get to know how they operate and what is involved is a great first step. Usually these voluntary roles are either advertised by the charity or can be set up via a phone call to the charity. Some training is also useful, such as that run by the Close Brothers Trustee leadership programme, or training bodies such as the NCVO. Otherwise, it’s useful to be clear about the charitable causes that you are interested to be part of and the skills you have to contribute.
Trustee roles are advertised in some of the broadsheet newspapers, as well as locally and on specialist sites such as Charity Jobs, and on the websites of particular charities. If you get chance to meet the CEO or Chair of a Charity then they will be a useful source of knowledge about what skills the charity currently needs. As with any recruitment it might take time to find the right fit, and organisations with well managed governance will run good recruitment processes with formal interviews before selecting Trustees.
Are trustees obliged to report to the Charitable Commissioners during the year or at any time they serve as trustees?
There are legal requirements (in the Charities Act and associated regulations) for charities, relating to maintaining accounting records, preparation of charity accounts and Annual Reports, auditing and submission of accounts, Annual Reports and Annual Returns to the Charity Commission. Registered charities with a gross income of over £25,000 per year must submit their accounts to the Charity Commission annually, within 10 months of the end of the relevant financial year. Failure to do so could lead to regulatory action from the Charity Commission.
In London there has been a move by local authorities via the coalition governments “Big Society” idea to empower local communities to take on the services normally done by the local authority, especially in the parks of the capital. Some of these groups have emerged from the “Friends of Regents Park” for example to then become a management committee for that park.
How would these groups attract more younger people to become trustees?
The simply answer is to advertise the opportunity and make it easy for young people to know how to get involved. Advertising via twitter or Facebook where young people will engage, and creating specific role descriptions aimed at the skills that young people can bring to Trustee roles is important.
How do you see the “third sector” developing over the next years? Will we see more local groups become charities and take more of a direct role in our day-to-day lives, where traditionally local government would provide these roles?
I think that there is a definite move to ‘localism’ and us wanting to manage our day to day lives effectively in our own back yard. New technology initiatives such as www.nextdoor.com will help us achieve that support by setting our own parameters for our local neighbourhood, and locally based charities are well placed to step into these roles. The previous centralised funding support from National and Local Government will not be regenerated, and as such, making sure that our charities are well-run, well-governed and able to provide good support is essential.
What has been the impact of crowd funding and peer-to-peer schemes on charities?
The charity sector has been relatively slow to invest in crowd funding either from donation sites or lending sites such as Kiva where donors lend small amounts of money that is repaid. The reward model adopted by Kickstarter and Indiegogo is common in the US, although few UK charities have embraced it. The donation model is most common in the UK as it is closest to traditional fundraising.
There has been much initial hype from some UK charities in crowd funding models, for example from the Cancer Research UK MyProjects website which allows supporters to donate as little as £1 to a research project of their choice, but the ideas have not caught on widely. At present, when there hasn’t been real proof of the efficacy of crowdfunding I feel that charities might be better in investing their resources in more traditional fundraising, such as major gifts of corporate fundraising. These areas are likely to give a better return for the resources expended, than crowd funding options, where customer and audience behaviour in the UK is not yet demonstrating that there is a real market-place for charities in this area.
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