Charities Management | Trustees


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Being proactive as a trustee

In 20 years as a charity trustee I have seen many of the challenges which can face trustees, both on a personal level and as a trustee group. Whilst being a trustee remains a rewarding experience it is far from an honorific. To get the best out of it for both yourself and the charity there are some important actions to consider from day one.

Being a trustee requires a commitment to the charity’s purpose of course. Never get involved in a charity if you don’t believe in its cause, as the commitments you will need to make will always seem a burden and you will likely fall short.

A key commitment is time

Trustees should understand from the beginning what time commitment is required. I would suggest a new trustee should always have an honest conversation with the chairman before you commit, not only as to how much time will be required (as a minimum) but also how much he or she expects of the trustees.

Then make a personal commitment to making sure you do allocate that time. This means planning your time and realising from the outset that where this commitment conflicts with your private life, the charity should usually come first. Most boards treasure trustee time and use scheduling to make giving time as easy as possible. A key relationship is the charity or board administrators – make friends with them to get a heads up on dates and events.

However, it is not just a few hours at the meetings which require your time. A commitment to being an effective trustee means ensuring you are properly prepared for those meetings. This means reading your papers - not just on the train but in a thoughtful structured way, so you can contribute fully at the meetings.

As a trustee we are there to interrogate fact and establish what is best for our charity. A quote I always remember is that “anecdote is not the plural of data” – i.e. short cuts in analysis are not good enough. We need to make decisions on established and verifiable data not on what we hear from others.

The papers won’t tell the whole story, so take the time to fill in the gaps. Keep abreast of the work of the charity, the causes that it is seeking to address and any political or economic factors. Follow what other similar charities are doing.

Refreshing your expertise

Keep your charity expertise up to date - one way to do this is to sign up to any update services offered by professionals in the sector.

From time to time re-read the Charity Commission guidance for trustees. There are a number of charities whose legal structure also makes them subject to the provisions of the Companies Act. Make sure you know exactly what governs your charity and make yourself familiar with the rules.

I would also recommend attending any training or seminars offered to your charity. However, be conscious of the interests of those hosting such sessions. Whilst much of the content is usually helpful, they are run to showcase and frame a commercial proposition as well. The same is true of the update services, but at least your will see a range of views.

The time management required can be challenging running alongside a busy career. Some employers encourage involvement and are flexible over the time involved but, in many cases, it is left to individuals to manage their time effectively. At times in my career I have worked late in the evening and at weekends and holidays to free up time for trustee meetings.

You have to be brave

Remember why you are there. It can be easy once you get to know your fellow trustees to become comfortable with the board’s procedures and customs. A trustee’s role requires constructive criticism and a constant re-focus on a charity’s aims and objectives.

It is understandable not to raise issues at your first meeting, but it is your responsibility to question and ensure the way the board functions is effective and proper. If there is an issue, it will not help you to say you knew there was one but failed to raise it because you didn’t want to “rock the boat”.

It is always worth familiarising yourself with the model governance codes and asking if your board complies and, if not, why not. In my experience, some boards believe they have special circumstances which makes some provisions inappropriate for them. It is always worth challenging this assumption.

It can be that a stable board could have blindness by familiarity and needs some fresh thinking which might challenge a comfy status quo. The governance codes are there for a reason and whilst not law or hard rules, do generally represent good practice and make trustees effective and professional.

Group actions and issues

As a trustee group you will face challenges but these can be met with appropriate responses.

There will be a lot of experience at the table – perhaps from that charity sector, the business sector or those with well established trustee skills. However, it is important to remember that trustees have a duty to take advice. There may be expertise on the board but it is usually better to use this to question the status quo and any advice given, rather than deliver the primary advice and avoid using third parties.

Third party advice can have many advantages. It is independent, impartial and comes with the latest thinking and expertise in specific areas. As a trustee’s hair gets greyer, he or she should accept that perhaps the detailed technical points aren’t perhaps what they were 20 years ago. Savings made on not paying for advice are seldom real savings. As St Luke puts it in his gospel, “the labourer is worthy of his hire”. And, although not mentioned by St Luke, a third party professional has an errors and omissions insurance policy too.

Given all the day to day activities of charities, it is sometimes difficult to find time for one of the trustees’ more important roles, monitoring and review. This necessarily involves a regular programme of reviewing strategy, policies and progress against specific goals and targets.

A trustee board cannot afford to take a “if it ain’t broke, don‘t fix it” attitude. It is only by exploring other options and providers that trustees can really know if their advisers are doing the best job possible. It is also only by setting reasonable but measurable targets that trustees can be sure of progress.

Monitoring professional advisers

The responsibility to monitor and review also extends to the trustees’ appointment of professional advisers.

However, well they are performing (or how good the relationship) these appointments should be reviewed at least every five years. It doesn’t necessarily follow that such a review will result in a change of adviser. Rather it is important because it both enables the trustees to remind themselves of what alternative providers can offer and confirms that their rationale for the original appointment is still valid.

For the same reason a significant change of personnel or an extended period of underperformance should trigger a similar exercise even if the figures for the longer term remain good. All of this takes time, but it is time well spent by a trustee body. It enables them to demonstrate they have discharged their duty of care.

This is all covered by the Charity Commission guidance CC14 which is there to help trustees discharge their legal duties. Often these things are a matter of simple common sense, but it is always helpful to refer back to the guidance.

Short cuts which might seem sensible may in fact involve regulatory or legal risk. The rules are there to protect trustees, staff and beneficiaries, and whilst compliance is time consuming, it is hardly overwhelming. Many other professions have far stricter regulation.

Charities gain specific privileges by being charities and these rightly require trustees to be worthy of them. It is not enough to simply to do good. Charity trustees need to be models of good governance, good practice and effective management, and focused on their charity’s aims and objectives above all.

What lessons have I learned as a trustee?There are a number of them.

Retaining a sense of purpose

The most important is “to thine own self be true”. A trustee should never forget why they are a trustee and what it means to be a trustee. It is better to be the stone in the trustee board’s shoe than known for your passivity. I like to think of it as being the grit in the oyster.

We become charity trustees to make a difference. Making that difference is important and is only achieved by listening, questioning and learning. If a board won’t let you do that, you should consider resigning. If a board is not open to either constructive questions or change, it is difficult to see how your presence will make a material difference and your time is precious.

To avoid this, try to work out before you start if the group of trustees will have the same approach as you. You might not be able to meet them all but do try to find out as much as you can about them and particularly the chairman. If you get into this position always let your chairman know your concerns when they arise. It might be that others share your view or that your concerns can be addressed.

We become trustees because we have ethics. Whatever the attractions of efficiency and expediency your ethics should be your guide.

Providing independent thought

We become trustees to provide independent thought. What the crowd is doing should be closely analysed but it is not a reason to follow suit.

As trustees, the commitment is not only to the work. It is to question and challenge thinking and ensure the creative dynamic of reasoned argument and debate is channelled into the successful delivery of a charity’s aims and objectives

What a challenge! Guidance is available on a number of issues from governance to policy. It is there for a good reason and it makes sense. You should therefore have a very good reason if your trustee board decides not to follow it. In the same way, if we take advice, we should follow it unless we have very good reasons not to.

President John Fitzgerald Kennedy (JFK) said: “Every accomplishment starts with the decision to try.” As trustees and as a trustee board our challenge is to try and it is only by doing so that we will achieve our charitable goals and ensure our charities survive so long as they serve a purpose.

Andrew Wauchope – as a trustee we are there to interrogate fact and establish what is best for our charity.
"A trustee’s role requires constructive criticism and a constant re-focus on a charity’s aims and objectives."
"It is only by exploring other options and providers that trustees can really know if their advisers are doing the best job possible."
"Whatever the attractions of efficiency and expediency your ethics should be your guide."
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When charity trustees’ decisions are challenged

As charitable provision of health and social care grows, so too does the need to take difficult decisions – including closures – and the risk of legal and other challenges to those decisions.

Recent Charity Commission scrutiny of a decision to close a hospice offers a pointed reminder to trustees that any decision to close or move a residential centre – whether a hospital, care home, hospice or otherwise – is likely to generate substantial public concern. Increasingly, this concern can lead to legal or regulatory challenge, and heavy scrutiny of the process followed by trustees in reaching their decision.

In this article I want to look at the recent Charity Commission scrutiny of St Margaret’s Somerset Hospice’s remodelling of its services, which will involve controversially closing its in-patient unit in Yeovil. I will also consider some of the other ways in which decisions of this nature have been challenged in recent times, and ways in which trustees can protect themselves from those challenges.

Trustee decision-making

St Margaret’s Somerset hospice delivers care to patients and their families who are facing a life limiting illness. The trustees of the charity made the decision to close its in-patient unit in Yeovil. However, in the wake of this decision members of staff, volunteers and the local public were very concerned about the proposal and commenced a social media campaign to prevent it. The local MP also became involved in the protests.

Complaints were made to the Charity Commission about the trustees’ decision-making which resulted in the Charity Commission opening a regulatory compliance case to assess whether the trustees had followed proper process.

As the regulatory body which examines the actions of trustees in the charity sector, the Commission must investigate any accusations of wrongdoing and, if necessary, carry out a statutory inquiry to understand what has gone wrong and how it can be fixed. If the Charity Commission decides that a charity’s trustees have not acted in the best interests of the charity, it can exercise draconian powers, including removing trustees.

In the case of St Margaret’s Hospice, however, the Charity Commission was satisfied that the trustees had complied with their legal duties in reaching the decision, and that they had undertaken a comprehensive review of services which resulted in a decision that was informed through accurate and up to date information. Ultimately, the Commission were satisfied that the trustees had taken “a decision that a reasonable body of trustees could make”.

Ways of challenging decisions

Complaining to the Charity Commission is only one way to challenge decisions of this nature. Another is through public campaigning, and charities considering a closure will inevitably face this to some degree, and therefore need to think carefully about how to engage with it. Having said this, one is seeing much greater appetite from claimants (and their lawyers) to use other legal routes to challenge.

Such challenges have included: threatened judicial review legal proceedings (on the basis that the charity was carrying out public functions by operating publicly funded care homes); claims for breach of residents’ rights under the Human Rights Act 1998; legal proceedings for breach of trustees’ obligations under the Charities Act 2011, and complaints to the Charity Commission itself.

There is a lot that a determined complainant can do in the courts to stymie a decision. These different legal routes can lead to different courts and different remedies, but what they all have in common is that they will be expensive, time-consuming and stressful to defend, and can fatally undermine the trustees’ decision, and ultimately confidence, in the trustees themselves.

It is therefore vital that trustees rigorously ensure that they comply with their legal duties in reaching a decision of this nature.

Making the right decisions

Trustees are under a legal duty to act in the best interests of their charity, which includes taking appropriate advice from experts where it would be prudent to do so. Decisions must be made by trustees collectively - having considered all of the facts, whilst disregarding irrelevant material - and this can be difficult to do where issues are emotive. Trustees need to make sure that enough information has been gathered and examined to ensure that they can take a reasoned decision.

Furthermore, conflicts of interest can be a significant concern in these areas, and trustees are reminded that they have a legal duty to avoid conflicts, noting that perceived conflicts can be as problematic as actual conflicts on occasion.

In the case of St Margaret’s, the Charity Commission noted that before reaching the decision to close the centre, the trustees had “over several years, undertaken a comprehensive county-wide review, consulted widely with stakeholders, undertaken research and taken advice from experts in palliative and end of life care”.

The Commission clearly relied on this in reaching their view that the trustees had obtained enough information from their stakeholders to enable them to take a reasonable and reasonably well informed decision.

There is no one-size-fits-all approach, but trustees should consider very carefully how they will engage with patients and other stakeholders before reaching a decision of this nature. There is a real risk that a decision taken without that engagement would not withstand legal scrutiny – whichever legal form that takes.

The Charity Commission also noted with approval that St Margaret’s had self-reported the proposal to the Charity Commission as a serious incident report. This underlines the fact that it pays to be on the front foot with the Commission. However, it is also an important reminder that self-reporting does not prevent or limit regulatory investigations; trustees must self-report where required and be prepared to prove that their governance stands up to scrutiny.

Careful risk assessment

Where there is a reconfiguration of services which results in residents or service users needing to move for their care, treatment or accommodation providers need to ensure that any transition is managed carefully to limit the risk of quality or safety failures, which could have a serious personal cost for the individuals in question and create risk for the charitable provider.

Residents often have complex and overlapping physical and mental health needs which are managed by myriad providers and any transfer therefore requires careful risk assessment and planning. Clearly, any transfer to a service less able to manage the individual’s needs is fraught with difficulty, but even when the service provider is well equipped to manage the service user’s needs it should have all the necessary clinical and other information to ensure a seamless transition.

The view from the CQC

There is currently a Care Quality Commission investigation into an alleged criminal failure to provide safe care and treatment, in circumstances where aspects of the patients care were not clearly communicated on transfer. The patient subsequently died very shortly after transfer in circumstances where it was not clear what level of observation was required at night, and this had in fact not been communicated clearly.

My colleague GILL WEATHERILL says: There are increasingly claims, inquests and other regulatory scrutiny of providers which identify risk assessment and information sharing as the root cause of service failures when vulnerable individuals are moved. Coroners, in particular, are fond of referring to the “cracks in the jigsaw” when failures in communication result in harm to patients and service users.

The Care Quality Commission (CQC) - as the regulator of health and social care services, and also the primary prosecution body in the event of failures to deliver safe care and treatment - will also focus carefully on the risk assessment and care planning of individuals. This may be as a part of routine inspection, following concerns being raised by family members, or as a result of particular incidents being reported.

Making the right choices

Trustees must be on the front foot when it comes to regulatory scrutiny by both the Charity Commission and the CQC. They should be ensuring due process is followed, understanding the risks and potential gaps in service delivery as a result of decision-making, and ensuring a proactive approach to the potential challenges that they may face – including self-reporting to the Commission.

Regulators are concerned with the safety of patients and service users, thus appropriate risk assessments are essential to fill any of the “gaps in the jigsaw” so often mentioned by coroners.

Good governance is fundamentally about ensuring trustees are making well informed decisions, and that the charity is prepared and proactive when demonstrating that the charitable objects and best interests of the charity’s service users sit at the heart of decision-making.

DAC Beachcroft’s Alistair Robertson – trustees need to make sure that enough information has been gathered and examined to ensure that they can take a reasoned decision.
"Trustees are under a legal duty to act in the best interests of their charity, which includes taking appropriate advice from experts where it would be prudent to do so."