A series of scandals involving some of our most respected charities has damaged public perceptions and trust in the sector. Developed by charities and backed by the Charity Commission, the Charity Governance Code was launched a year ago to help restore public trust. It focusses attention around 7 principles of good governance and makes some key recommendations. Since its launch, the code has gained wide support from across the sector and early adopters have praised its clarity and accessibility, one charity describing it as a “no-brainer”. So what are the principles and how do you adopt it?
The code recommends taking each of the 7 principles and “apply or explain”. The seven principles are:
1. Organisation purpose
2. Leadership
3. Integrity
4. Decision making, risk and control
5. Board effectiveness
6. Diversity
7. Openness and accountability
The code also recommends that there should be between 5 and 12 trustees and that they should each not serve on the board longer than 9 years.
The code has its own website https://www.charitygovernancecode.org/en/front-page where you will find an explanation of the principles and resources to help you understand and adopt them. There are two versions of the code depending on whether you are a small or a large charity and the website also provides a useful diagnostic tool to help you assess your current position and identify improvements. This is a fantastic starting point and we would recommend all our charity and academy school clients download this tool if they haven’t already.
How you adopt the code is entirely up to you, but using a process that works for you and your own organisation is important. Some charities have set up working groups or a cross-sectional task force to implement the code, others have built it into the trustee meeting agenda so that it is addressed and reviewed on a regular basis. We are also encouraging clients to include the code in their annual trustee reports to help your stakeholders understand how you are continuing to make improvements.
To find out more or to make a start, download the diagnostic tool from https://www.charitygovernancecode.org/en/pdf. As always, if you have any questions about this, please speak to your usual Hillier Hopkins advisor or Deanne Shumate on 01923 634456.
