As a Trustee, you, alongside your fellow Board members, have overall control of a charity and are responsible for ensuring that it fulfils its charitable purpose and undertakes the activities it was established to do. Although it is a voluntary role, you will be leading the charity and determining how it is to be run. You will also make decisions which will affect your beneficiaries’ lives, as well as the staff who are employed within the charity.
Trustees need to utilise skills and experience to support their charities and assist them in achieving their charitable aims. Who said being a Trustee was easy?
There are six main duties which Trustees should consider when making decisions or discussing activities and future plans:
1. Ensuring the charity carries out its purposes for the public benefit
The Board should always ensure the charity is carrying out the purposes for which it was set up. Reference should be made to the charity’s purposes as set up in its governing document. Trustees should update plans on what the charity will do and how they will achieve these plans. Trustees should be able to demonstrate how the charity’s activities are in furtherance or support of its charitable purposes, and how the public benefits from carrying out its purposes.
2. Comply with your charity’s governing document and the law
The Board must ensure that the charity complies with its governing document and should actively review this document to ensure it remains valid and updated where necessary. The charity must comply with relevant charity law and other applicable laws. Trustees should be aware of any specific laws applicable to the activities of the charity. It is also a Trustee’s responsibility to actively seek professional advice where deemed necessary to ensure an understanding of relevant requirements, and compliance with them, is achieved within the charity.
Registered charities also have a responsibility to maintain up to date details with their regulators and to ensure annual financial information is filed on time.
3. Act in your charity’s best interests
Effective decision making is key to ensuring Trustees act in the best interests of the charity. Decisions need to be balanced, well informed, unbiased, and considerate of both short term and longer term goals.
Trustees should avoid situations where personal interests conflict with their duties as a Trustee. Where potential conflicts do arise, full disclosure of the conflict should be documented at a Trustee Meeting, and the Trustee involved should remove themselves from any discussion surrounding the topic to avoid any influence on the remaining Trustees.
Trustees must also not receive any benefit from the charity unless it is authorised by way of the governing document and internal regulations and found to be in the best interests of the charity. This rule also applies to anyone financially connected to the individual Trustee.
4. Manage your charity’s resources responsibly
Trustees must act responsibly, reasonably and honestly, and exercise sound judgement in their decision making and actions involving the charity and in their personal lives. This is to ensure the protection of the reputation and good name of the charity. Therefore Trustees need be considerate of matters which could bring their actions into question or take any inappropriate risks.
The charity’s assets must only be used to support and carry out the charity’s purposes. Trustees should also ensure that restricted funds are expended only for the purposes intended. It is important to safeguard the charity’s resources and that policies and procedures are in place, and reviews are undertaken to ensure that these policies are being followed. A consequence of failure is that the charity is exposed and vulnerable to theft or fraud, and Trustees could be in breach of their duties.
5. Act with reasonable care and skill
Trustees want to make a difference in their local community, and hence, need to ensure they have the necessary skills to perform their duties well. Training should be provided for Trustees where a deficiency in skill level is identified, and this will ensure that Trustees can make use of their skills and experience to perform their duties with reasonable care and skill. If a Trustee requires professional advice, then this should be acquired to ensure that laws and regulations are not breached.
The responsibilities that a Trustee has, combined with the volunteer nature of the role, means that adequate time needs to be made available for proper thought processes to take place and to bring energy and active participation to meetings and regular Trustee sessions. Trustees should actively promote the charity and its activities to ensure the great work performed by the charity is recognised in the local area.
6. Ensure your charity is accountable
Compliance with statutory accounting and reporting requirements is the responsibility of the Trustees. However, they may delegate the operations of this compliance to local management or professional advisers.
The Trustees should demonstrate that the charity is complying with relevant laws, is well run and is operating effectively.
Where the charity has members, then Trustees are accountable to the membership body by reporting annually at its AGM on the results and achievements of the charity throughout the year. Where tasks or decisions are delegated to staff or volunteers, Trustees need to provide guidance and advice to ensure that a clear message and direction is given for the benefit of the charity.
Ultimately, the role of the Trustee can be demanding, involving a balance of the responsibility of adhering to many laws and regulations whilst undertaking a voluntary role. The UK’s third sector continues to grow and provides many services previously undertaken by local authorities or the NHS. It is therefore reliant on the support of local people to become Trustees in their communities to support these vital services.
If your charity and your Trustees would benefit from Trustee training then please get in touch at help@armnstrongwatson.co.uk.
