This week is Trustees’ Week – and here at Higgs, we’re celebrating with articles about the hot topics in the charity and not-for-profit arena.
Today, Ellie Williams, Associate in Higgs’ Charity and Not-for-Profit Law team, discusses the importance of diversity on trustee boards.
What is it and why is it important?
The Charity Governance Code states that Board diversity, in the widest sense, is important because it creates more balanced decision-making and increases a charity’s legitimacy and impact. A diverse board with a range of knowledge, skills, and experiences helps the charity manage challenges that may arise and think flexibly.
The conclusions in the Charity Commission’s report on public trust in charities 2023 suggest that the public has a greater level of trust in charities with a close connection with the local community. One way trust can be reinforced is by having a trustee board representing the community it serves.
Charity trustee vacancies are high. Reach Volunteering (a charity that connects trustee vacancies with trustee volunteers) lists more than 1,200 Trustee/Governor vacancies across the UK.
Where to start?
An effective trustee board is essential for the successful operation of a charity, and identifying the best trustee for the role is extremely important. The existing trustees will be best placed to start any search by conducting a skills and experience audit amongst themselves to identify gaps that can helpfully be filled through the appointment of a new trustee(s).
It won’t always be possible for a trustee board to cover all areas of expertise. Sometimes, it will be preferable, or even essential, for professional advice to be sought externally, even if there is professional expertise within the trustee body (for example, an auditor or surveyor).
The process
The starting point when appointing trustees is to look at what the charity’s governing document says, as it will set out the process required for appointing trustees. The process involved will vary depending on the legal structure of your charity. Also, remember to check the eligibility of any prospective trustees.
One way to reach a broader range of potential trustees is to avoid the typical “word of mouth” approach to trustee recruitment and conduct a more formal recruitment process. This can include preparing a role description, advertising the role and making it clear that people with a diverse range of backgrounds, experience and knowledge are encouraged to apply.
Induction
Making sure that a proper induction is carried out with new trustees will help them feel comfortable and confident in their new role. This can include ensuring they have access to key documents and understanding policies and procedures, for example. As part of this process, it is important to ensure that all trustees are welcomed and that their point of view is listened to. The Chair of trustees can play an important part in this by ensuring all of the trustees have the opportunity to contribute to discussions during meetings.
Removing barriers to involvement
Research shows that many trustees are retired, which makes sense as they are likely to have more spare time to commit to a trustee role and will provide valuable knowledge and experience. There are a number of things the trustees can do, however, to widen the pool of potential trustees to those who might otherwise face barriers to becoming involved, for example:
- Holding meetings via video call to enable trustees to participate with minimal travel time and cost, and as well as assisting those with childcare or other caring responsibilities who might not be able to attend in person. The ability to make decisions in this way should be included in the charity’s constitution.
- Considering the scheduling of the meetings so they are set at times that are more convenient for those with caring/work responsibilities.
- Putting in place policies and procedures to ensure timely reimbursement of legitimate trustee expenses, including transport, meals and childcare costs.
In certain, limited situations, it might be possible for a trustee to be paid for acting as trustee. This would need specific consent from the Charity Commission or the Court, either for a specific arrangement or for provision to be included within the charity’s constitution.
The Charity Commission’s guidance explains that “if trustee boards are convinced that only payment of a more direct benefit will enable them to obtain the skills, experience, and diversity they need for the charity, the Commission will consider a reasoned case” for payment of a trustee.
This includes situations where not all trustees are able to give their time freely and the Commission accepts that “in some cases, particularly where loss of earnings will cause hardship, an element of financial compensation might be justified.” This is not a common approach, and a thorough application to the Commission explaining why it is in the best interests of the charity.
A further option is the appointment of user/beneficiary trustees to ensure there is diverse representation of skills, experience and backgrounds on the board.
