Big or small, it is, of course, incredibly flattering to be approached to act as a trustee of a charity, particularly if it is a worthy cause or something you are passionate about. As such, it is also easy to get sucked in! Perhaps you see it as a stepping stone or a way to enhance your CV, but, before you accept this honourable position you ought to be aware of what you are getting yourself into.
What is a trustee?
In the UK, charity law defines a 'charity trustee' as the person having general control and management of the administration of a charity. Typically, trustees are not remunerated (save for reasonable expenses as outlined in the charity's constitution). Of course, as a charity grows, they may delegate tasks to volunteers or paid individuals but, ultimately, they are legally responsible for it. Depending on a charity's size, a trustee may be involved in each and every aspect of its activities such as assisting with fundraising to delivering projects as well as fulfilling managerial duties.
In effect, a trustee is responsible for ensuring that the charity is solvent, managed effectively, and delivers on the charitable outcomes for which it has been set up. If you don't feel that you can make this commitment, then perhaps you can volunteer with the charity instead.
How to become a trustee?
To be a trustee, you must be at least 16 years old (or at least 18 years old if the charity that is not registered as a company or a charitable incorporated organisation ('CIO')) and you should check whether or not you require a Disclosure & Barring check as certain charities carrying out 'regulated activities' may require this. Furthermore, there are grounds of disqualification precluding some from acting as a trustees such as: any unspent convictions or if they are subject to a debt relief order.
If you are offered a role, you may be asked to sign an appointment letter or agreement. Needless to say, this ought to be reviewed by an independent legal adviser to ensure it is in order and compliant with the Charites Act. If accepted, you will be listed on the Charity Commission's register where your personal data including your name, date of birth, contact details, and details of any other trustee roles that you hold will be made publicly available. Moreover, if the charity is a limited company, such personal data will also appear on the Companies House website. You need to, therefore, consider what information you are willing to expose to the world. It is absolutely vital not to charge ahead and accept this role until you have undertaken your own due diligence to your satisfaction.
What to consider before becoming a trustee position?
As a trustee, it is your professional and personal reputation that are on the line, especially in the charity sector. Consider the cautionary tale of the charity 'Kids Company'. A simple Google search will tell you the story of a good charity which went seriously wrong; when facing allegations of misspending charity funds leading to the trustees to become embroiled in lengthy litigation, suffering reputational damage and a lot of stress.
How to conduct effective due diligence?
Google is good place to start. Find out what they do and how they operate and ask yourself: "would this be a charity I would want to donate my hard-earned cash to?" As a trustee, you are an integral part of the charity so visit the charity's site, talk to those involved already – are they passionate and positive about the charity's work and message. Become a volunteer of the charity yourself first (before becoming a trustee) to gain an insight as to how it actually functions.
Now consider looking into the charity's reputation, financial standing, and how well it is governed. Ask for a copy of the charity's constitution, read its annual accounts, or contact the Charities Commission and see whether if anything's amiss. Oftentimes, it's just best to ask the current trustees themselves as regards the charity's operations, its funding, if it has experienced any major issues and why is it only now that a vacancy has opened up. In doing so, you are conducting a thorough SWOT and PEST analyses of the charity seeking to identify the challenges that it may face. Ask yourself again: "am I able to offer help? "Am I willing to commit my time and energies to this"?
What are a trustee's legal obligations?
There are a number of legal responsibilities placed on trustees and it is important that you understand these before accepting a trusteeship. You must:
- Act in your charity's best interests.
- Manage the charity's resources responsibly.
- Act with reasonable care and skill
- Ensure your charity is accountable.
- Comply with the charity's governing document and the law.
- Ensure your charity is carrying out its purposes for the public benefit.
What do to when things go wrong?
Hopefully, your term as a trustee will be rewarding but you must be mindful that it may not always be the case. If things go wrong (or are about to), our recommendations are that you:
- Raise your concerns with a fellow trustees and/or the chairperson. At first, this should be done verbally but, if your concerns remain, raise them again in writing;
- Ensure you attend and express your views at the trustees' meetings and take the time to make sure that the minutes accurately reflect your contribution;
- Regularly review the charity's constitution, its policies and procedures together with the Charity Commission's and Fundraising Regulator's websites. Be aware of the representative bodies: the Association of Chief Executives of Voluntary Organisations ('ACEVO') and The National Council for Voluntary Organisations ('NCVO') (representative bodies). They will provide useful guidance and advice;
- If you have identified wrongdoing yours or another trustees, seek legal advice. Be transparent and do what you can to protect yourself; and
- If all else fails, resign. It is not worth being dragged through the mud having your actions and/or reputation scrutinised in a court of law or, most importantly, through the court of public opinion.
How can trustees protect themselves?
While different trustees can bring different skillsets and knowledge bases to the role, and take charge of certain functions, remember this is a jointly responsible role. Of course, if something is outside of any person's area of expertise, it's perfectly acceptable to delegate such tasks provided that any delegation is unanimously agreed in writing and does not conflict the obligations outlined above. Moreover, the Charity Commission encourages charity trustees to seek out professional advice where appropriate.
Do not take risks in this regard, if you have a questions, even a seemingly daft one, ask. Remember it is your reputation that is on the line. A point to raise here is that, if you are a trustee of an unincorporated charity, you may be held personally liable, either to the charity itself or to third parties meaning that, where the charity fails to fulfil its contractual duties or legal obligations, a third party may be able to bring a claim against the trustee themselves as opposed to the charity. Of course, such legal exposure is reduced if the charity has a CIO status because then it is, in its own right, a legal entity and therefore liable for the charity.
It is important you check the Charity's constitution for two things. Firstly, to see if there is any indemnity that the charity has for its trustees. Also, whether it allows for trustee indemnity insurance. If so, you should check that your charity has this and other insurances in place.
Summary
All charities are different. You must understand their purpose, their unique structure, and the role that you fulfil.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
