Being a trustee is not just about good intentions

Yesterday I went to a roundtable meeting to discuss the new draft guidance on ‘The Essential Trustee’, which the Charity Commission is currently consulting on.

There are two drivers behind the proposed changes:

  • the Commission has been finding that far too many mistakes are being made by trustees
  • the development of means that documents need to be redrafted to be click-able, accessible web-content.

The new version makes a new distinction between ‘must’ and ‘should’:

  • Must’ refers to a specific legal or regulatory requirement that trustees must comply with.
  • Should’ now means something is a minimum good practice requirement which may, if not complied with, constitute a breach of duty. The Commission therefore expects trustees to follow these unless there is a good reason not to.

Nearly everyone in the room seemed to welcome the more directive tone of the draft guidance: there is overall agreement that intention to be more explicit about what duties are necessary (even if not underpinned by a specific legal requirement) is correct.

‘Must’ and ‘Should’

However the distinction between ‘must’ and ‘should’ has always been problematic, and in the new version it is even more difficult. In particular, it doesn’t capture the range of different ‘shoulds’.

So there is a certain amount of confusion as to:

  • when a good practice requirement has regulatory force and is in practice compulsory
  • when instead it is desirable and left to the trustees’ discretion.

A solution would cover the ground in-between, differentiate the ‘regulatory shoulds’ from the ‘good practice shoulds’.

Trustees are responsible

The draft guidance places more emphasis on the responsibilities of being a trustee, and on the role being one of ‘constructive challenge’ as well as general management of the charity.

Trustees also need to comply with a range of other legal and regulatory requirements from equality law, employment law, health and safety, etc.

The message that the Commission is trying to get across is that good intentions are not enough. This is the right approach.

But we don’t want to see too much stick and not enough carrot. The risk otherwise is to put the frighteners on trustees, and to inhibit action and innovation at a time when trustees need to use their discretion and experiment more, so they can meet today’s challenges.

The consultation

The Commission is very much in listening mode, and open to hearing from the sector and practitioners on how the guidance can be improved. So if you have not already done so, you can respond to the consultation up until the 17 February.

Or share your views with us by leaving a comment below.

NCVO, ACF, CFG response

We have worked closely with the Association of Charitable Foundations and the Charity Finance Group in developing a joint response.

All of us were in agreement that the current draft takes an excessively prescriptive tone, and could therefore inhibit action and innovation at a time when trustees need to use their discretion more, in order to meet today’s challenges.

Read the joint NCVO ACF CFG response.

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Elizabeth was head of policy and public services at NCVO until 2020.

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