Governance round-up: April 2017

The general election and charities

On Tuesday, the prime minister’s announcement that there will be a general election in June will prompt many trustees to review responsibilities in relation to engaging with politicians and political activity. Political activity is a legitimate activity for charities, however a charity must not give its support to any one political party and charities that are campaigning will need to take special care to ensure their party-political neutrality. Trustees should review Speaking out: guidance on campaigning and political activity by charities (CC9) and the lobbying act guidance (pdf, 120KB).

Charity Governance Code consultation response

Over the past six months I have been working as part of the Charity Governance Code steering group to develop and consult on a new governance code for the sector (pdf, 210KB). Following our analysis of over 200 consultation responses, the code’s steering group has now published a summary report on these findings (pdf, 510KB).

The headlines are that there is broad support for the principles set out in the draft code and that 83 per cent of respondents said they would use the new version. In the words of Rosie Chapman the group’s chair there is however a need to ’refine and polish’ this version.

Over the next few weeks I’ll be working with colleagues on the steering group to ensure that:

• the recommended practice sections are applicable to organisations of different size
• we are clearer about the purpose of the document
• we offer clarity on the apply or explain concept, as well as work through the more detailed commentary on sections.

The steering group expects to publish a final version of the code in the summer.

Charities and values

In the trustee training and board facilitations I undertake, the topic of organisational values and how these statements influence decision making are a regular item of discussion. The review of fundraising practice highlighted the importance of charities acting in step with their values and it is my experience that trustees recognise and agree with the importance of values in building public trust and confidence. Developing and agreeing values statements which inspire action and say something about our organisation’s purpose are therefore critical.

Max du Bois has argued in the Guardian that ‘if charities can’t inspire loyalty then “caring capitalism” will take over’. Max makes a strong case for bold and different statements which go further than simply stating desired behaviours.

In an article on a similar topic for Third Sector Stella Smith is clear that retaining values and being business-like are not mutually exclusive. She argues instead that the sector’s values and ethics are our greatest strength, but if we mistakenly use them as a basis to resist change, they could also become the reason for our downfall.

I agree with the sentiment of both these pieces – charity values need to be bold, meaningful and understood as enabling statements about the way charities do business. The Charity Commission also places emphasis on the duty of trustees to think about how their practices reflect the charity’s values, and our Tools for Tomorrow guide offers some practical guidance for boards on the development of positive organisational values statements.

House of Lords report

Last month the House of Lords select committee on charities published its report Stronger charities for a Stronger Society (pdf, 1.7MB). In case you missed it, our director of public policy and volunteering, explored what it means for our sector and I wrote a more detailed analysis of the governance recommendations. On the whole, we welcomed the committee’s findings and recognise that NCVO must play a significant role in their implementation. It was particularly positive to see strong support for the draft governance code and the notion of time off for professionals undertaking trustee responsibilities.

From the Commission

The Charity Commission has launched a new accounts templates pack for small charitable companies to help trustees of charitable companies with an income of under £500,000 prepare their accounts. The new charitable company accounts templates are the product of a close partnership between Companies House and the Charity Commission to ensure that the templates reflect the regulatory requirements, current guidance and best practice.

Blogs

Our director of planning and resources at NCVO has written a blog post on changes to legislation that make it mandatory for organisations with more than 250 employees to publish gender pay gap figures. Susan argues that although reporting is a ‘useful way of highlighting the issue, real change can only happen if a holistic approach is adopted’. If you employ staff has your board considered the measures Susan suggests such as: flexible working hours, shared parental leave and family-friendly policies?

ICSA audit committees terms of reference

The Institute for Charters Secretaries and Administrators (ICSA) has published some useful new guidance terms of reference for audit committees (pdf, 320KB). It draws on the experience of company secretaries and is based on best practice as carried out in some of the UK’s largest listed companies.

NCVO training and events

• Charity trustees: Induction and refresher – 28 April 2017
• Supporting good governance: Effective board servicing – 8 May 2017
• Charity trustees: Induction and refresher – 30 June 2017
• Supporting good governance: Effective board servicing – 14 July 2017

For more regular updates follow me @mynameisdanfran or @NCVO on Twitter.