Governance round up – December 2014

Emma Herbert

Emma Herbert leads our work on governance with a focus on reviews and board performance. Before joining NCVO, Emma worked as business development manager at Daycare Trust and has also been a consultant to the Equal Opportunities Commission, specialising in issues of sex discrimination in the workplace.

NCVO’s planned review of the Charity Commission’s governance structure and appointments process

We want to find ways for the regulator to put questions about its political neutrality to rest. Acting independently, NCVO will investigate potential alternative models of governance for the Commission, and ways to strengthen perceptions of its independence.

Read Sir Stuart Etherington’s post on our review of the Charity Commission

The Essential Trustee consultation

The Charity Commission has issued a new draft of The Essential Trustee, its guide to charity trustees’ responsibilities. The new draft follows recent commission guidance on decision making and conflicts of interest. It reflects other changes such as the introduction of Charitable Incorporated Organisations.

The Commission is seeking views on the updated draft – submit your comments before 15 February 2015.

Clarified Electoral Commission guidance

NCVO has been talking to the Electoral Commission about the need for further clarity for charities on campaigning and the application of the ‘Lobbying Act’. The Electoral Commission has updated its list of frequently asked questions. It now covers some specific issues about charities and campaigning, including:

  • what happens if a political party decides to support the stance of a charity on a particular issue
  • when raising awareness of an issue can still meet the purpose test.

For general guidance on charity law generally, the Charity Commission’s Speaking out: guidance on campaigning and political activity by charities (CC9) remains helpful.

Read Elizabeth Chamberlain’s post on the Electoral Commission’s guidance

Colonels, Gongs and parsley on fish

Trustees Unlimited has published the results of a survey of its database of 2,000 trustees.

The aim of the survey was to understand more about how board performance is measured and the contribution trustees make to enhance their organisation’s performance. The results make for interesting reading, not least due to the amusing titles given to certain behaviours!

News from the Charity Commission

Changes to the 2015 Annual Return

The Charity Commission has announced changes to the annual return which will apply when charities report on their financial years ending in 2015.

Changes include three new question areas, which received broad support in the consultation:

  • In the reporting period, how much income did you receive from:
    • contracts from central or local government to deliver services
    • grants from central or local government?
    • Does your charity have a policy on paying its staff?
    • Has your charity reviewed its financial controls during the reporting period?

We’re pleased at NCVO that the proposal to force charities to disclose their expenditure on ‘campaigning activities’ was deferred for further consideration. Read NCVO’s response to the Charity Commission’s consultation on the annual return. For further background on our position, read Karl Wilding’s blog explaining our response to the proposals.

More money, proposed new powers

The Commission welcomed the government’s announcement of:

  • new funding to help it prioritise its monitoring and enforcement work
  • the publication of the draft Protection of Charities Bill which includes greater powers to disqualify trustees and issue official warnings.

This adds some meat to the Commission’s new chief executive’s first public speech at the Charity Finance Summit where she said the regulator is becoming ‘tougher, smarter, more agile and more proactive’ under her watch.

But not everything they wanted…

The draft Bill does not include its proposal that people who are disqualified from trusteeship should also be banned from taking up other key roles in charities, such as treasurer or finance director. It had also pressed for powers to prevent mismanagement or misconduct or other breaches before they occur, by directing trustees not to take specific actions.

Parliament has called for written evidence on specific areas of the Bill

Charities, trustees and strategy development

The Commission has released an independent report produced for them by the Institute of Chartered Accountants in England and Wales (ICAEW) and published a response.

It looks at charities’ strategy development, implementation and review by analysing material provided by 26 charities with annual incomes under £5m. Perhaps not surprisingly the review concludes that charities with a strategy cope better with pressure and can adapt more easily to changes and for small charities without a strategy survival becomes all-consuming.

Download our free, annual publication ‘The Road Ahead’  for help with formulating your own strategy in the context of emerging external influences for the sector.

Dates for your Diary from NCVO Training

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