Why is good governance important for charities?
The Charity Governance Code states that "Good governance in charities is fundamental to their success. It enables and supports a charity’s compliance with the law and relevant regulations. It also promotes a culture where everything works towards fulfilling the charity’s vision."
What did the Chairty Commission find?
This inquiry identified several failures by the then trustees and executive, including not complying with the charity’s own policies, failing to undertake adequate due diligence on some significant donations, and in their legal duty to file statutory returns with the Commission by the required deadline.
The inquiry concluded that there had been misconduct and/or mismanagement in the administration of the charity by its then trustees, as well as insufficient oversight of the charity’s executive by the then trustees.
The results of the inquiry clearly highlight the importance of a trustee’s role and their responsibilities to their charity and its beneficiaries. You can read the full report from the Charity Commission here.
Steve Roake, Head of Compliance Visits and Inspections at the Charity Commission said “Good governance is not a bureaucratic detail – it underpins the delivery of a charity’s purposes to the high standards expected by the public. Our inquiry found that the then trustees of Human Appeal did not have the oversight needed regarding the activities of their charity.”
“While trustees of larger charities will delegate certain tasks to staff members, we and the law are clear that trustees retain ultimate responsibility for running their charity, and our guidance is clear that trustees must ensure that robust reporting procedures are in place. Responsibility for ensuring they have sufficient information and are adequately informed to make decisions rests with the charity trustees.”