Alert for large charities issued: the importance of transparency and accountable governance

Publication of the Charity Commission’s decision following its charity inquiry into The Royal National Institute of Blind People and RNIB Charity was accompanied by an alert issued to charities appearing to:

  • have an income of over £9 million, and a more complex governance structure in that it is governed by a board of trustees but run by a separate body of executives; and
  • be a service-providing charity, in that the charity’s front-line staff directly serve and interact with beneficiaries (some of whom may be vulnerable) and / or provide amenities or facilities to the public

emphasising the need for any such charity to put in place clear and adequate lines of accountability in the governance of the charity.  

Recipients of the letter: do not ignore this alert…

Any charity that has received a copy of the alert accompanied by a letter from the Commission should note that the Commission intends, later this year, to contact a sample of the recipients of the alert “to understand what measures are in place to manage identified risks”.

If a recipient of the letter and alert from the Commission is planning significant changes to the charity in the near future, or has not, within the last twelve months, reviewed:

  • its existing general governance arrangements
  • its risk management measures and
  • assurance mechanisms in relation to the charity’s people protection arrangements and activities

the alert contains the warning that they should do so. The Commission expects such charities to “be mindful” of the risks highlighted by the alert, and to take steps to mitigate them.

Advice to charities with complex governance structures

The guidance highlights the risk that a more complex governance and management structure, involving a board of trustees, a group of executives and potentially sub-committee structures operating under different leaderships can lead to communication breakdowns, in particular if oversight is weak, or even compromised. This in turn can lead to failures in the areas of safeguarding and governance.

The guidance contains advice both to trustees governing charities with such complex structures, and to executives of such charities, setting out steps to take to ensure effective oversight.

It emphasises that trustees must seek to have “robust oversight” of their charity’s operations and structure, taking into account the complexity, scale, nature and associated risks of its activities. They must be willing, and able, to hold the executive to account.

In its advice to executive groups, the guidance makes clear that a charity’s executive should be able to identify failures to protect people from harm, to learn from those incidents, and to disclose those incidents fully and frankly to the trustee board.

Advice to charities with front-line staff (including volunteers) working directly with beneficiaries

The guidance also emphasises that, while safeguarding remains a priority for all charities, it is particularly important in charities with staff and volunteers that work directly with beneficiaries, some of whom may be vulnerable and sets out key issues and steps for such charities to take in order to protect people with whom the charity comes into contact, including highlighting the need for:

  • effective safeguarding policies and procedures,
  • sufficient resources and appropriate staff allocation, and
  • embedding a culture of “speaking up”.

Posted by

Tags

Mills & Reeve Sites navigation
A tabbed collection of Mills & Reeve sites.
Sites
My Mills & Reeve navigation
Subscribe to, or manage your My Mills & Reeve account.
My M&R

Visitors

Register for My M&R to stay up-to-date with legal news and events, create brochures and bookmark pages.

Existing clients

Log in to your client extranet for free matter information, know-how and documents.

Staff

Mills & Reeve system for employees.