The Charity Commission’s report into the RNIB – issues for all trustees to think about

Last week the Charity Commission published its report into the RNIB following what has evidently been a lengthy and complex inquiry looking at the charity’s governance arrangements. Given the size and complexity of the charity, the issues that have been investigated range from the trustees’ decision making, to risk management and assurance, safeguarding, and regulatory and legal compliance. But also wider cultural and organisational issues. There is a lot to learn from reading the report.

The Charity Commission followed up by issuing a regulatory alert to groups of charities that it believes face similar risks, specifically:

  • charities with an income of over £9 million which have ‘complex’ management structures,
  • and those which provide frontline services and whose front line staff directly interact with beneficiaries, some of whom may be vulnerable

However, there are a number of issues identified in the report that all charity trustees are likely to want to reflect upon, as they are essential to effective governance and ensuring their charity is operating effectively and in line with its values.

Ensuring the charity’s governance arrangements between entities are appropriate

This is particularly relevant for charities that are growing and taking on more services. Rapid growth can easily lead to structures involving multiple entities and several boards evolving over time. Without regular review this can develop in a way that is possibly unplanned, ending up with complex or messy governance arrangements, a lack of understanding of respective roles and accountability. In turn that can mean weak oversight by a parent charity and a lack of overall alignment with the charity strategy or purpose.

A regular review of the charity’s governance arrangements should ensure that there are appropriate structures and reporting which reflect the scale and complexity of activities that a charity carries out.

The board’s skills and experience

The same applies to the board’s skills: it is important to undertake regular skills audit and recruit trustees with the relevant skill set and experience.

There is an interesting recommendation for RNIB highlighted in the report which charities with a high proportion of elected trustees may want to consider: to reduce the proportion of elected trustees and other reserve positions, in order to allow flexibility in populating the board with appropriately qualified trustees. Although electing trustees serves to ensure a connection and accountability with a charity’s membership, the very nature of elections rarely means a charity can guarantee the delivery of the range of skills and experience required to run the charity.

Being an active and strategically focused board

There is a clear thread throughout the report findings on the dangers of a passive board – and that is certainly relevant for all charities.

The role of the board is not simply to ‘check in’ every few months, and scrutiny should not be superficial. The board is there to drive the charity strategically, and to both live and champion organisational values.

This means for example that:

  • The board needs to be properly informed, not accepting a culture of ‘reporting by exception’ whereby the executive or subsidiary entity only reports on events or decisions which fall outside of the agreed delegations.
  • The board needs to be active in identifying areas that are no longer a strategic priority or from which the charity should withdraw.

Having suitable processes in place

Just as important as making sure the governance system reflects a charity’s scope and activities, the necessary processes and procedures need to be in place to ensure compliance.

In particular, in the case of charities undertaking increasingly complex activities, there need to be:

  • Appropriate systems in place for recording, reporting and escalating serious incidents, including complaints
  • Processes for monitoring safeguarding, and ensuring safeguarding concerns are consistently investigated and reported to the appropriate bodies
  • Clear documentation setting out the relationship between the charity and its subsidiaries, the division of responsibilities and how issues will be dealt with (from data sharing to regular reporting).

Many of the issues I have highlighted are likely to be obvious things that trustees think about regularly. But it is also easy to lose sight of them, so occasions like this can serve us all as a useful reminder to undertake regular independent governance reviews which check that all the right systems and processes are in place.

Here below are some resources that can help trustees in doing so, and other relevant guidance.

Practical guidance and resources

I would also encourage looking at the RNIB’s progress report which sets out all the changes that the charity is making. This not only demonstrates the RNIB’s commitment to address the issues identified, but it also provides a valuable ‘roadmap’ that other charities may want to follow.

 

 

 

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Elizabeth Chamberlain Elizabeth is head of policy and public services at NCVO. She has been part of the policy team since 2008, as the expert on charity law and regulation. Her policy interests also include charity campaigning, the sector’s independence, transparency, and accountability.

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