Transcript Document

Trustee Role and Responsibilities
Toolkit
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
NOT TO BE REPRODUCED WITHOUT PERMISSION
Role

‘Persons responsible for the management and
administration of the charity’
– Section 177 Charities Act 2011

Defined within governing document
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
Responsibilities

Duty of Care, Compliance and Prudence

Care – ‘to exercise such care and skill as is reasonable
in the circumstance’ (Trustee Act 2000). Work together
as a body of trustees. Seek advice as needed.
Compliance – with Charity Law and other legislation,
regulators (eg Charity Commission), reporting and
accounting requirements, governing document and
objects of the charity.
Prudence – to use good judgment and plan ahead –
including clear financial management.


Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
1. Governance

1.
2.
3.
Govern/Lead the charity – responsibility for being the
ultimate decision makers for directing the charity
Follow governing document provisions and regularly review
governing document (good practice- bi-annually).
Keep the charity following its objects (good practice – review at
each trustee meeting).
Monitor activities and outcomes against the objects of the charity
(good practice – review at each trustee meeting).
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
2. Accountability

1.
2.
3.
Legal responsibility - accountable for the charity
Appoint trustees in accordance with governing document.
Universal accountability to all – public, donors, beneficiaries,
regulators and any other party – ensure records are clear.
Openness and transparency whenever possible.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
3. Policy/Strategy

1.
2.
3.
Develop policies and plans, including business plan,
and decide on best approach for future of the charity
Regularly review direction and approach taken by the charity,
and internal and external influences.
Ensure policies and plans are robust and properly implemented.
Evaluate and monitor policies and plans.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
Business Plan - Tips
START
Analysis of the charity – objects, history, track record, evaluation of services
and activities.
EXTERNAL ENVIRONMENT
Any factors that will influence the charity in the future – changing social
needs, competition, new opportunities.
STRATEGY
Explain the ultimate goal/objectives and how the trustees intends to get there
– such as defining project milestones.
RESOURCES
Consider how the charity will resource its future – including financial
projections, cash flow forecasts, staffing costs, premises costs, project costs.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
Business Plan - Tips
IMPLEMENTATION
The plan is a working document and should detail how it will be implemented.
Risks should be discussed.
MONITORING
Monitoring and evaluation criteria for the activities noted in the plan should
be detailed in the plan.
CAPACITY
Demonstrate that the charity has the capacity to deliver the goal/objectives
noted in the business plan – such as skills and experience of trustees, staff
and volunteers – and detail any plans for increasing capacity further.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
4. Finance

Responsible for the financial health of the charity.
Ultimate responsibility for ensuring charitable funds are
spent on charitable purposes
1.
2.
Ensure charity compiles accounts and reports on its activities in
accordance with legal requirements.
Maximise the income available from assets and investments held
by the charity – such as trading activities and use of charity
property.
3.
Ensure robust financial controls are in place.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
5. Communications/PR

Reputational Management – trustees should determine
the purpose of the charity’s PR strategy and the image
of the charity and its beneficiaries.
1.
Should raise awareness of the charity or an issue.
Designed to increase the charity’s income.
Ensure strategy is mutually beneficial for the organisation and
service users/beneficiaries.
Establish market dominance – ie that the charity is selected over
competitors when people donate funds or time.
Should be able to justify costs against planned benefits.
2.
3.
4.
5.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
6. Risk Management
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1.
2.
3.
Trustees need to balance opportunities available
against the risk, cost and potential negative impact of
opportunities.
Divide risk into categories – eg governance, operational,
financial, environmental, compliance.
Look at the charity from differing angles – eg staff can assist with
operational risks, third parties such as service users can assist
with external or environmental risks.
Once risk identified, assess the probability that the risk will occur
and the impact of the risk, should it happen.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
6. Risk Management
4. Use a robust scoring system – eg risk table, risk grading.
5. Consider countermeasures for managing high scoring risks.
6. Ensure risk profile/risk register is subject to regular monitoring by
named individual/s and to a stated frequency – eg monthly.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
i.
ii.
iii.
iv.
v.
vi.
vii.
Conflicts of Interest
Remuneration
Employment
Breach of Trust or Ultra Vires
Insurance
Health and Safety
Data Protection
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
Conflicts of Interest
General principle of trusteeship is that trustees must act in best
interests of the charity and not benefit from their trusteeship. Trustees
need to avoid any conflicts of interest between own interests and
those of charity.
1.
Have a clear Conflict of Interest policy.
2.
Regularly review potential conflicts – direct financial interest,
indirect financial interest and non-financial/personal conflicts.
3.
Maintain and regularly review a ‘Register of Trustees’ External
Interests’.
i.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
ii. Remuneration
General principle of trusteeship is that trustees must act in best
interests of the charity and not benefit from their trusteeship.
However, there is now limited provision within Charity Law for the
payment of trustees, specifically for professional skills.
1.
Payment must be specifically provided for in the charity’s
governing document, or authorised by Charity Commission.
2.
Number of trustees benefitting at any one time must be minimum.
3.
Payment is NOT for being a trustee – but for professional skills,
eg legal, financial, building work.
4.
Conflict of interest must be appropriately managed.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
iii. Employment
If the charity employs staff, trustees are classed as employers. For
unincorporated charities, responsibility rests with individual trustees.
For incorporated charities, the company is the employer.
1.
Employment law is complex – matters to consider include
employment contracts, family friendly requirements, working time
regulations, transfer of undertakings - seek advice.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
iv. Breach of Trust or Ultra Vires
Role of trustee is defined by law (Section 177 Charities Act 2011,
‘persons responsible for the management and administration of the
charity’) and the governing document for the charity.
- If trustees act appropriately within these defined roles, they are
afforded protection from legal action against them.
- If trustees step outside their legally defined roles, they may be
acting outside their powers – acting ‘ultra vires’ or in breach of
trust. Trustees are then more vulnerable to legal action.
- ENSURE all trustees understand the governing document for their
charity and act within it, as a body of trustees.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
v. Insurance
Trustees must review the activities of their charity and identify which
insurances are optional but necessary and which are legally required.
1.
Required by law? (eg employers liability).
2.
Required under the charity’s contracts? (eg buildings insurance).
3.
Required in relation to charity’s activities? (eg public liability).
4.
Required in relation to charity’s assets? (eg contents insurance).
5.
Any other policies might be needed? (eg trustee indemnity).
6.
Identify who has responsibility for arranging insurance.
7.
Check regularly that policies are current.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
8. Check regularly that the policies represent value for money.
9. Ensure policy documents are kept safe and secure.
Note – trustees can delegate these duties to staff but trustees need
to be satisfied that these points are met.
Note – Trustee Indemnity Insurance – trustees may wish to purchase
cover to protect themselves against actions arising out of their
trusteeship – not a legal requirement, and is seen as a benefit to
trustees. Trustees should always remember to make decisions in the
best interests of the charity and as a body of trustees, to reduce risk.
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
vi. Health and Safety
Trustees are responsible for health and safety within the charity. This
includes for staff, volunteers, service users and visitors to the charity.
1.
Should have a written health and safety policy in place (legal
requirement for those with five or more employees).
2.
Policy should consider the activities undertaken by the charity,
the working environment, work activities and the nature of service
users.
3.
Seek advice – eg free publications from Health and Safety
Executive - www.hse.gov.uk
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
7. Regulatory Considerations
vii. Data Protection
Trustees are responsible for the management and administration of their
charity, including compliance with data protection requirements.
1.
Is there a legitimate reason for processing data?
2.
Is information on the charity as data controller and the purposes for data
processing available to the data subject?
3.
Can data subjects opt out?
4.
Is data accurate and up to date? How do you know this?
5.
What security measures are in place to protect data?
6.
Is notification with the Information Commissioner necessary or is the
charity exempt?
For full information – www.ico.gov.uk
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
Toolkit Summary
ROLE
Responsible for management and administration of charity.
Defined within governing document.
RESPONSIBILITIES - Duties of care, prudence and compliance.
1.
Governance
2.
Accountability
3.
Policy
4.
Finance
5.
Communications
6.
Risk Management
7.
Regulatory Issues
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
Q&A
Dr Deborah Morgan
www.morganwoodworthpartnership.co.uk
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