rs1 - trustee recruitment,selection and induction · induction 5 charity commission guidance 5 our...

RS1 - Trustee Recruitment, Selection and Induction

(Version March 2002 r05/05)

Contents

PageIntroduction 1

Executive Summary 3

Recruitment and selection 3

Induction 5

Charity Commission guidance 5

Our Findings 7

Trustees and governance 7

Preparing to recruit 8

Skills and experience 9

The Recruitment Process 1 1

Finding the right people 11

Describing the role 14

People who are disqualified from acting as trustees 15

Conflicts of interest 16

User trustees 18

Induction 1 9

Information every new trustees needs 20

Trustees need to be able to assert their authority 21

Securing charity property 22

Training for new trustees 23

Evaluating recruitment and induction 23

Annex A - Survey Techniques 2 5

Annex B - Resources for Trustees 3 4

Annex C - Bibliography 4 0

Annex D - Glossary of Terms 4 4

Acknowledgements 4 5

Introduction

1

This report examines how charitiesselect, recruit and induct new trustees.

It is the first of a new series of studiesby the Commission of issues that areimportant for regulating the proprietyand effectiveness with which charitiesare governed. We, the Commissioners,see these new reports as an importantnew way of meeting our legalresponsibility under the Charities Act1993 to give advice and guidance totrustees, and to promote thedevelopment of better methods ofcharity administration.

There are about a million trusteesrunning charities in England and Wales.If they were not prepared to put in timeand effort for the good of others, usuallyunpaid, charity work would not getdone and the community at large wouldbe the loser. Whether the charity is amulti-million pound organisationrunning a large, professional operation,or a small local group with no staff andonly modest resources, being a trustee isa job which involves importantresponsibilities, and which needs to belearnt like any other.

Between them, trustees look after185,000 registered charities, with anincome of £25 billion and assets of morethan £60 billion. They do so on thewhole with great dedication andfulfilment, and considering how manycharities there are, cases where trusteesrun into serious difficulties are rare.

When charities do get into difficulty,however, the governance provided bytrustees can unfortunately be part of theproblem. Difficulties are likely to followwhere trustees do not fully understandwhere their responsibilities begin and

end, or where they do not have enoughinformation about their charity’sactivities, or enough control over them.

When people first become trustees,therefore, they need to understand whatis involved, and are entitled to expecthelp with preparing themselves to dothe job effectively.

Best practice on recruitment andinduction is already very good. Somecharities are thinking harder about howto find trustees with the right skills andexperience, and looking for them moreenergetically, and from a wider range ofages and social and economicbackgrounds. Many charities are alsoshowing flair and thoroughness inintroducing new trustees to the charityand its work, and, where necessary, tothe essentials of what being a trusteeinvolves. Charities are able to call on awide range of advice and guidance fromthe Commission and others to help withthis.

But the clear message from this report isthat improvement is needed.

Too many charities are relying too muchon recruitment methods that arenarrower and more passive than theycould and should be. If more charitiesused the full range of options moreimaginatively, our work suggests thatthe common impression that potentialtrustees are scarce would be lesswidespread.

Too many charities are also expectingnew recruits to come to terms with thedemands of the job without access at theoutset to basic information about thecharity’s activities, finances andconstitutional aims.

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And not enough trustee bodies areaware of the need to check that newcandidates for trusteeship are legallyeligible, and how to go about this.

Addressing these issues at the start oftrusteeship is not a complete answer togovernance problems, but it is animportant first step.

Introduction

Executive Summary

The recruitment, selection andsubsequent induction of a new trusteeinto a charity are an opportunity toimprove the effectiveness of that charity.Where all three elements work properlyit can lead to a balanced, well informed,and effective trustee body that can resultin a well governed and effective charity.Where the process is weak, or absent,then at best the effectiveness of thetrustee board may be hampered; atworst it can lead to major problems forthe charity and its beneficiaries.

Difficulties that the Commissionencounters in charities include caseswhere trustees:

• treat their position as purelyhonorary, and do not appreciatetheir responsibilities for the charityand its resources; or

• do not make themselves familiarwith the charity’s constitution, sothat they are not clear what it doesand does not have the power to do;or

• do not spot circumstances in whichthey need to get specialist advice,for example on legal or financialissues; or

• leave an individual trustee or staffmember, or a small group, to runmatters without sufficientaccountability or control; or

• allow personal affairs and resourcesto become entangled with those ofthe charity, or otherwise fail to spotand manage potential conflicts ofinterest; or

• manage the charity in their owninterests or those of a narrowinterest group, not those of thecharity as a whole.

All of these problems can be avoided bytaking care over recruitment and byproviding a robust induction programmethat gives new trustees the information,both about their role as trustee andabout their charity, that they need.

The findings of our examination ofCharity Commission cases and an NOPsurvey are summarised below. Furtherinformation on each point can be foundin the main body of the report. Charitiesseeking assistance to improve theirrecruitment, selection, and inductionprocess may find the resources listed inAnnex B useful.

Recruitment and selection

• When recruiting new members totheir board, existing trustees must beclear in their own minds about thecharity’s purpose and aims. Theyalso need to understand theirbroader duties and responsibilities astrustees, to ensure both that they areacting in the best interests of thecharity, and that they are in aposition to explain to new trusteeswhat is required of them.

• Trustees need to ensure that they,rather than staff, retain overallresponsibility and control of thetrustee recruitment, selection andinduction process.

• Existing trustees have a clear role toplay in overseeing the effectivemanagement of an open andefficient process. This applies

3

whether trustees themselves selectnew colleagues, or whether otherarrangements apply (for example,election or nomination by amembership).

• An assessment of the skills present,or “skills audit”, of the existingtrustees is a best practice way toidentify gaps. This assessmentshould include consideration of whatskills are required by the board toperform effectively, and whetherthere are any gaps.

• For smaller and simpler charities, theassessment can be simple, and neednot involve more than theapplication of common sense.

• For larger and more complexcharities, a more formal andstructured skills audit will usually beof benefit. It is a matter of concernthat few charities except for thelargest carry out such reviews, andthat, even of the largest charities,over half of those surveyed did notdo so.

• The NOP survey did not bear outthe widespread perception thatsuitable trustees are intrinsically hardto find.

• It is a reasonable assumption thatrecruitment difficulties could bereduced by a combination of betterassessment and audit of skills needs,coupled with more open andinclusive methods of search,including advertising andnetworking between charities.

• Current levels of reliance onpersonal recommendation and word-of-mouth are surprisingly high, andthere is a need for charities of all

Recruitment and selection

sizes to broaden their recruitmentpractices and adopt moretransparent methods.

• The Commission believes thatdiversity is an important factor foraccountability and public confidenceand we urge charities to seek greaterdiversity across their trustee boards.

• The Commission welcomes thegrowing emphasis by some charitieson diversity in recruitment oftrustees, and urges this as a furtherreason for charities to seek to relyless on traditional methods ofrecruitment and more on methodswhich are inclusive and transparent.

• Charities should use trustee “jobdescriptions” or similar guidance toprovide prospective trustees with abalanced account of what the role oftrustee entails, including their dutiesand responsibilities as a trustee.

• Charities should ensure that all itsnew and potential trustees haveaccess to the Charity Commission’spublication Responsibilities ofCharity Trustees (CC3) and thatthey have read and understood thecontents.

• Trustees must ensure that they areaware of the legal rules on eligibilityto serve as a trustee, bearing in mindthat it is a criminal offence to serveas a trustee if disqualified fromdoing so.

• The current position on performanceof checks on new trustees isunsatisfactory.

• The Charity Commission will publishguidance clarifying and publicisingthe obligation on trustees to check

4

the eligibility of new trustees, andgiving practical advice on how to doso.

• All charities should have in placearrangements for identifying andmanaging conflicts of interest andensure that their trustees are awareof these arrangements.

• It is good practice to ensure thatpotential new trustees consider thequestion of possible conflicts ofinterest before there is commitmenton either side. This is particularlyimportant where personal interestsmay be significant enough to makeit difficult for the individualconcerned to make a full androunded contribution to the board’sdiscussions and decisions.

• Charities should consider whetheruser trustees could improve theireffectiveness and responsiveness.Potential conflicts of interest need tobe carefully considered but willusually be manageable.

Induction

• Charities should provide all trusteeswith sufficient induction material toallow them to understand theircharitable purposes, financialposition and current issues. TheNOP survey suggests that moreconsistent application of this bestpractice is required, mainly bysmaller charities, but also by some ofthe largest.

• Induction material should alwaysinclude the charity’s governingdocument, in addition to accounts,with explanatory material wherenecessary, and recent minutes oftrustee meetings.

• There is scope for the developmentof better and more comprehensivetraining material for new trusteesand others in the basic requirementsand skills of trusteeship. Sectorbodies and funding agencies shouldconsider how the development ofsuch training could be financed andhow it could be made most widelyavailable.

• Ideally, such training should becapable of leading, or contributing,to an accredited qualification, andshould be available in a variety offorms, including as distancelearning.

• The Commission stands ready toparticipate as a partner in thedevelopment of such trainingmaterial, and particularly to helpassure the soundness andcompleteness of its technical contentdealing with matters of charityfinance, governance and propriety.

• As an interim measure, there isscope for current providers oftraining material for trustees topublicise, and the CharityCommission to co-ordinate and“signpost” it more effectively.

• Charities should seek to establishsystems of evaluation and review sothat they can measure theeffectiveness of the recruitment andinduction arrangements they haveadopted.

Induction

5

Charity Commission guidance

Existing Charity Commission guidancefocuses on what an effective andefficient trustee board should look likerather than on how such a board can becreated. Preparing this report has shownthat, in addition providing new guidanceon charity checks, the CharityCommission’s existing guidance couldbe improved by setting out in moredetail good governance arrangementsfor recruiting, selecting and inductingtrustees.

• Transparent recruitment, selectionand induction procedures, which useelements of good practice should beregarded as one of the hallmarks ofa good charity. The CharityCommission will amend itsHallmarks publication, CC60, toreflect this point and we will use itin our Review Visits to assess theextent to which this good practice isfollowed.

• The Charity Commission willconsolidate its existing guidance ontrustee recruitment, selection andinduction into one booklet dealingwith trustee responsibilities.

Charity Commission guidance

6

Our Findings

Trustees and governance

Trustees are responsible for controlling acharity’s management andadministration. They are responsible forensuring that a charity’s income andproperty are used only for the purposesset out in the charity’s governingdocument and for no other purpose.Trustees have a responsibility to actreasonably and prudently in all mattersrelating to the charity, and have aresponsibility to act in the best interestsof the charity.

To achieve continuous improvement inthe service they provide to beneficiaries,charities need to be open to change.This report and the survey undertakenin connection with it by NOP show that,although many charities are adoptingcurrent good practice in relation totrustee recruitment and induction, thereare many who are not.

Trusteeship is a skill that grows overtime with experience - and with trainingwhere necessary. But the better a charityhandles the selection, recruitment andinduction of new trustees at the outset,the greater the immediate contributionthey will be able to make to the qualityof its governance and its work. This islikely to produce, not only better resultsfor those the charity is there to help, butalso greater confidence and fulfilmentfor the new trustees themselves.

As well as contributing to thesepositives, good selection, recruitmentand induction can contribute to theavoidance of some negatives. In morethan 40% of the investigation cases theCommission closed in 2000/01,mismanagement or maladministrationwas a factor. Poor governance, including

poor understanding or performance oftrustee responsibilities, was a frequentfeature in these cases.

Difficulties that the Commissionencounters in charities include caseswhere trustees:

• treat their position as purelyhonorary, and do not appreciatetheir responsibilities for the charityand its resources; or

• do not make themselves familiarwith the charity’s constitution, sothat they are not clear what it doesand does not have the power to do;or

• do not spot circumstances in whichthey need to get specialist advice,for example on legal or financialissues; or

• leave an individual trustee or staffmember, or a small group, to runmatters without sufficientaccountability or control; or

• allow personal affairs and resourcesto become entangled with those ofthe charity, or otherwise fail to spotand manage potential conflicts ofinterest; or

• manage the charity in their owninterests or those of a narrowinterest group, not those of thecharity as a whole.

By law, the Commission’s objective is toattempt to use its powers to makecharities effective in the work that theyexist to do. If a charity has got intodifficulties through honest mistakes, theCommission will usually be prepared towork with the trustees if it can to sort

7

matters out. But the Commission haschosen trustee recruitment and inductionas the subject for this pilot study in thehope that helping trustees at the startwill prevent some cases of difficultyfrom arising in the first place.

Preparing to recruit

The survey carried out by NOP for thisstudy showed that 31% of charitiesrecruit at least one trustee each year. In78% of large charities and 44% of smallcharities, the existing trustees have thesole responsibility for appointing someor all of the trustees (see Annex A forfull survey results and definitions ofcharity size).

Preparing to recruit

8

It follows that,

• when recruiting new members totheir board, existing trustees must beclear in their own minds about thecharity’s purpose and aims. Theyalso need to understand theirbroader duties and responsibilities as

trustees, to ensure both that they areacting in the best interests of thecharity, and that they are in aposition to explain to new trusteeswhat is required of them.

Trustees of charities that employ staffcan delegate aspects of the recruitmentprocess to their staff, but

• trustees need to ensure that they,rather than staff, retain overallresponsibility and control of thetrustee recruitment, selection andinduction process.

Whatever the method for selecting newtrustees,

• existing trustees have a clear role toplay in overseeing the effectivemanagement of an open andefficient process. This applieswhether trustees themselves selectnew colleagues, or whether otherarrangements apply (for example,election or nomination by amembership).

Taking responsibility forrecruiting, selecting and inducting

new trustees - Case study

This case highlights what happenedwhen the existing trustees of a charitydid not pay sufficient attention to therecruitment and induction process fornew trustees.

• A very large charity became thesubject of a formal CharityCommission inquiry following thediscovery of financial irregularitiesin connection with the chiefexecutive.

• Despite its size the charity had noformal recruitment and selectionprocedure and no induction

Frequency of Recruitment

35%

30%

25%

20%

1 5 %

1 0 %

5%

Twice a year

Annually

Every 2-5 years

When the need arises/keep numbers up

Rarely need to/hardly ever

Always/constantly

Never/Don’t need to

As vacancies occur

Due to retirement/resignation/death

Skills and experience

A charity’s trustee board, whenrecruiting new trustees, should firstconsider what skills, knowledge andexperience their board needs to ensurethat the charity is well governed, andrun effectively, economically, andappropriately to its size and complexity.This does not mean that trustee boardsshould contain “experts” or specialists tocover every eventuality. However, acharity should consider how manytrustees it needs for its board to runeffectively and the attributes orcompetencies these trustees should haveto add value to the board. This is avaluable process in its own right andtrustees should periodically review theposition rather than wait until a vacancyoccurs.


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process. The trustees did not playa significant role in the selectionof new trustees. Instead the chiefexecutive would choose people.The existing trustees would votethe proposed new trustees ontothe committee with littleconsideration of other options andoften without even meeting them.

• Over time this lead to a trusteebody that had largely beenselected by the chief executiveand which, in the absence ofproper induction procedures,relied almost exclusively on thechief executive for information.The marginalisation of the trusteeswas a factor in allowing quiteserious problems to develop. Theeventual outcome was a loss offunds, the dismissal of the chiefexecutive, and a major overhaul ofthe charity’s procedures.

When preparing to recruit, or at suitableintervals, trustees should make anassessment of the skills and experiencecalled for by the charity and the extentto which they are provided by existingtrustees, so as to identify whether thereare particular characteristics which theyshould seek in new recruits. Additionalskills may be needed when seeking tofill specific posts eg chair or treasurer.Where trustees are elected or appointedby others, there is still value in trusteesmaking this assessment and providing itto those with the power of appointment.

• An assessment of the skills present,or “skills audit”, of the existingtrustees is a best practice way toidentify gaps. This assessmentshould include consideration of whatskills are required by the board toperform effectively, and whetherthere are any gaps.

• For smaller and simpler charities, theassessment can be simple, and neednot involve more than theapplication of common sense.

• For larger and more complexcharities, a more formal andstructured skills audit will usually beof benefit. It is a matter of concernthat few charities except for thelargest carry out such reviews, andthat, even of the largest charities,over half of those surveyed did notdo so.


1 0

In exceptional cases, a charity maydecide that it needs a wider range ofskills, and hence more trustees than itsconstitution currently allows, for itsboard to be effective. While care isneeded to avoid trustee bodies that aretoo large for effective decision-taking,some charities may need to request thatthe Commission uses its legal powers toincrease the number of its trustees.

trustees to be active in the charityfor a period of time and toundergo a rigorous internalnomination procedure.

• The trustees lacked any reviewprocedure to enable them toassess the skills and thecomposition of the trustee body.

• The trustees were encouraged tothink about the areas from whichthey were recruiting; were theymissing out on opportunities toattract good quality trustees?

• Limitations on where trustees canrecruit should be avoided. If thegoverning document forcestrustees to recruit from a narrowpool it is highly likely that acharity will restrict not only theskills available but also the typesof people on the trustee body.

• In these circumstances it isparticularly important that a skillsaudit is used. The situation needscareful monitoring and may leadto a revision of the governingdocument provisions. Trusteesshould ask themselves if thereasons the restrictions wereoriginally included are still valid.

Thinking about the skills andcomposition of the trustee board -

Case study

This case highlights what can happenwhen there is a lack of a reviewprocedure to assess the skills andcomposition of a charity’s trusteebody.

• The trustees of the charity were indispute over a number of issues.One of the issues of disputecentred on the charity’s governingdocument which restricted whowas eligible to be appointed as atrustee, by requiring potential

Activities undertaken by the boardto help recruitment

80%

70%

60%

50%

40%

30%

20%

1 0 %

Total

A skills audit of trustees

Provide trustee jobdescriptions

Use a dedicated recruitingcommittee

Not stated

The Recruitment Process

Word of mouth and personalrecommendation appear more likelythan other methods to narrow thecatchment of trustee bodies, and lesscapable of providing a thorough meansof seeking people to fill gaps identifiedin skills assessments and audits. Atworst, there is a risk that these methods,which are intrinsically difficult tooperate in a transparent fashion, couldperpetuate exclusivity or the appearanceof exclusivity.

By contrast, the use of wider and moreinclusive methods of search, such asadvertising, using trustee brokerageservices and networking with othercharities, were little used. It is surprising,given rapidly growing expectations of

1 1

Are problems encountered infilling vacancies on the trustee body

Always

Sometimes

Never

Not stated

53%

4% 1 2 %

3 1 %

Finding the right people

Having decided what skills andexperience they need in new trustees,charities need to consider how best tofind and attract them. To achieve this,charities may find that they have toopen up their traditional recruitmentmethods to attract new trustees whofulfil these requirements. This isparticularly so where charities wish toattract a greater diversity of age andexperience (including social andeconomic background) to the charity.Unless specifically authorised by acharity’s governing document, a trusteecannot be paid. However, expensesincurred in the course of acting as atrustee can be reimbursed.

There is a widespread view that, ingeneral, good trustees are hard to find.This was not, on the whole, borne outby the results of the NOP survey. Ofcharities surveyed, 53% indicated thatthey never had a problem recruitingnew trustees, and 31% indicated thatthey had difficulties only sometimes. Thatthe survey did not clearly bear out thepopular perception of difficulty was, insome ways, all the more surprising inthe light of what it showed about currentpractice in seeking suitable trustees.

Traditionally, word of mouth andpersonal recommendation have been themain methods used to recruit newtrustees. This remains true to a strikingdegree. Reliance was placed on thesemethods by almost 70% of charitiessurveyed throughout the size range, andwas highest for large (84%) and verylarge (85%) charities.

Methods used to attract new trustees

Word of mouth andpersonal recommendation

Networking with othercharities

Trustees are elected fromthe membership

Advertising in the press

Use of trustee brokerageservice

80%

70%

60%

50%

40%

30%

20%

1 0 %

transparency and accountability insociety as a whole, that no more than11% of large and very large charitiesadvertised for trustee vacancies, and thatthe use of advertising was negligible formedium and smaller charities. Just 6% ofcharities networked with other charitiesto attract new trustees and only 1% hadused trustee brokerage services.

The 3% of charities surveyed which hadadvertised trustee vacancies in the presshad done so with varying degrees ofsuccess. Some charities felt they had notadvertised for trustees in the mostappropriate publications, while otherscommented that the people whoresponded lacked the skills andknowledge the charity required. Bycontrast, the Commission is aware fromits wider contacts with charities of caseswhere advertising has been verysuccessful in extending stakeholderparticipation and tapping new sourcesof high-quality candidates. Charitieswhich use advertising should considercarefully where the advert will be placedand ensure that the wording andinformation given accurately reflects thecharity and the skills and experiencerequired.

• The NOP survey did not bear outthe widespread perception thatsuitable trustees are intrinsically hardto find.

• It is a reasonable assumption thatrecruitment difficulties could bereduced by a combination of betterassessment and audit of skills needs,coupled with more open andinclusive methods of search,including advertising andnetworking between charities.

• Current levels of reliance onpersonal recommendation and word-of-mouth are surprisingly high, andthere is a need for charities of all

Diversity

sizes to broaden their recruitmentpractices and adopt moretransparent methods.

Diversity

A charity will often benefit from seekingto recruit and retain trustees who reflectand have knowledge of the communitiesand areas in which in which the charityoperates. For some charities, diversity inthe trustee body will be a major, specificissue. The Commission also shares thewidely held view that charitygovernance in the aggregate will beimproved and strengthened if charitiesof all kinds are able to attract trusteesfrom a wider range of ages and of socialand economic backgrounds than hastraditionally been the case.

We did not specifically prompt charitiessurveyed by NOP to comment on whetherthey encountered any difficulties relatingto a desire to attract a more diverse ormore representative board. However,seven charities volunteered that theywished to recruit more black and ethnicminority trustees, four that they wishedto recruit more women trustees and afurther five that they wished to recruitboth women and black and minorityethnic trustees. Seven per cent (7%) ofrespondents had a concern about theage of their trustees and a desire to recruityounger trustees. We welcome theaspirations to greater diversity intrusteeship shown in these unpromptedcomments, but note that they are unlikelyto be readily achievable by charities thatcontinue to place heavy or exclusivereliance on personal recommendation astheir prime means of recruitment.

In fact the predominant methods ofrecruiting trustees are likely to activelywork against diversity. This position isnot sustainable when there is pressure

1 2

Finding the right people

1 3

on charities to be more inclusive andmake greater efforts to reflect thecomposition and diversity of a changingsociety. The Commission believes thatdiversity is an important factor foraccountability and public confidenceand we urge charities to seek greaterdiversity across their trustees boards.This is a theme we will pursue in bothnew and existing work, and in discussionwith the sector and umbrella bodies.

In particular charities should note theadvent of the Race Relations(Amendment) Act 2000. This Act gives“public bodies”, which includes somecharities, a general duty to promote raceequality. It also stands as a statement ofgood practice for all charities to aspireto. The Commission, as a public body, isalso subject to this legislation and itimpacts on our regulation of individualcharities. We will be issuing detailedadvice to charities on this new Act laterthis year.

Trustees should be aware that otherelements of diversity are also affected bylegislation, for example the DisabilityDiscrimination Acts. Even if theappointment of a trustee is notspecifically affected by legislation,charities should look to such legislationas a example of good practice.

• The Commission believes thatdiversity is an important factor foraccountability and public confidenceand we urge charities to seek greaterdiversity across their trustee boards.

• The Commission welcomes thegrowing emphasis by some charitieson diversity in recruitment oftrustees, and urges this as a furtherreason for charities to seek to relyless on traditional methods ofrecruitment and more on methodswhich are inclusive and transparent.

Diversifying a trustee board -Case study

This case highlights the steps taken bya large charity, established to supportand promote the needs of youngpeople, to diversify its board byincluding more young people astrustees.

• The charity had two trustees underthe age of 26 on its board. Thecharity’s governing documentrequired its trustees to be drawnfrom its membership.

• The charity’s existing trustees werekeen to explore different avenuesto enhance user involvement, butthey wanted to avoid anycriticisms of tokenism. As thetrustees were aware they wereunlikely to hear about potentialyounger trustees by word ofmouth, they wanted to explorenew and innovative methods ofdirectly contacting theirmembership to become newtrustees. These methods includeda mobile phone text messagecampaign and visits to the charity’syouth clubs. Both methods werealso seen as a way of gettingdirect feedback from youngpeople.

• The trustees developed very clearpolicy guidelines designed to helpyoung trustees become part of aneffective board. The existingtrustees were aware that youngertrustees might feel intimidatedjoining an established board andtook steps to counteract this.These steps included establishingmentoring schemes as well asputting together development andtraining opportunities for the new

1 4

Describing the rôle

Prospective trustees with a clear idea oftheir duties and responsibilities are morelikely to be effective from the outset oftheir appointment. The recruitmentprocess should therefore give prospectivetrustees a balanced and realistic pictureof what being a trustee entails.

Existing trustees should be encouragingand open in their dealings with newtrustees and avoid either glossing overor exaggerating the role. Opennessabout the duties and responsibilities of atrustee will demystify them and help toreassure prospective candidates aboutany concerns they might have. Aninformal meeting at an early stage of theselection process can provide anopportunity for existing trustees toprovide prospective trustees with anunderstanding of what a trustee isrequired and expected to do.

Thirty-five per cent (35%) of charitiessurveyed that had difficulty in recruitingtrustees mentioned concerns byprospective trustees over the amount oftime the role would take. Being frankabout this may be useful, either inreassuring potential recruits about theirability to act, or in deterring those whowould genuinely be unable or unwillingto make the necessary commitment.

Describing the rôle

A trustee “job description” is recognisedgood practice, and can be a useful wayof explaining the role of trustee to newor prospective trustees. Trustee jobdescriptions can also be used tocomplement a skills audit. The NOPsurvey shows that, currently, only 18%of charities use trustee job descriptionsand 11% use a skills audit.

Written guidance about trusteeship iswidely available to charities, includingthe Commission’s bookletResponsibilities of Charity Trustees(CC3), ( see Annex B for moreinformation). As part of the registrationprocess for new charities, theCommission asks the trustees to declarethat they are aware of and have readour guidance on trustee responsibilities.

trustees. At the time of writing thetrustees were also consideringintroducing an observation periodfor potential trustees to see whatbeing on the board entails and atrial period for the new trusteeonce they have been appointed.

The main reason why charities experienceproblems recruiting trustees

Insufficient applicants/shortage of candidates

Finding people who arewilling to make thecommitment or have time

Finding people who havethe necessary skills/experience

People do not want theresponsibility

Finding people who areinterested

Finding younger people/current trustees are elderly

40%

35%

30%

25%

20%

1 5 %

1 0 %

5%

1 5

People who are disqualified from acting as trustees

• Charities should use trustee jobdescriptions or similar guidance toprovide prospective trustees with abalanced account of what the role oftrustee entails, including their dutiesand responsibilities as a trustee.

• Charities should ensure that all itsnew and potential trustees haveaccess to the Charity Commission’spublication Responsibilities ofCharity Trustees (CC3) and thatthey have read and understood thecontents.

People who are disqualifiedfrom acting as trustees

Some people are legally disqualifiedfrom acting as trustees. When a newcharity registers, the Charity Commissionasks the trustees to sign a declaration1

that they are not disqualified fromacting. Once registered we expect thecharity’s trustees to collectively ensurethat the board does not appoint orcontain any individuals disqualified fromacting as a charity trustee. Charities mustensure that they or their staff make thenecessary checks on prospectivetrustees, as it is a criminal offence for adisqualified person to act as a trustee. Ifexisting trustees proceed to appoint aperson who is disqualified then this islikely to be a breach of trust.

Only 33% of the charities surveyed hadcarried out formal checks on prospectivetrustees. The current position isunacceptable, as it puts both charitiesand individuals at risk. The Commissionwill shortly publish advice to all charitiesto clarify their obligations and providepractical advice on how to fulfil them.

A person is disqualified from acting as atrustee if they fall under any of thefollowing provisions, detailed in section72 (1) of the Charities Act 1993:

• People under the age of 18, unlessthe charity is a registered company;

• Anyone convicted of an offenceinvolving deception or dishonestyunless the conviction is spent;

• Anyone who is an undischargedbankrupt;

• Anyone who has previously beenremoved from trusteeship of acharity by the Court or theCommissioners; and

• Anyone who is under adisqualification order under theCompany Directors DisqualificationAct 1996.

In certain cases the Charity Commissionhas the power to grant a waiver andallow a person disqualified fromtrusteeship, under section 72 (1) of theCharities Act 1993 to accept a trusteepost. We only agree in those caseswhere the charity can clearlydemonstrate that the waiver is in thebest interests of the charity.

Are checks made on new trustees?

Yes

No

Not stated

33%

8%59%

1 The form is called a DEC 1.

Conflicts of interest

Some charities, for example those withvulnerable beneficiaries, may need tomake additional checks on prospectivetrustees to ensure they are notdisqualified from accepting the office.These checks may involve liaison withthe police or, when it is established, theCriminal Records Bureau. Trusteesshould be vigilant to ensure they remaininformed of any specific requirements.New powers to check trustee details areexpected in April 2002 and will becovered in the guidance that theCommission proposes to publish.

• Trustees must ensure that they areaware of the legal rules on eligibilityto serve as a trustee, bearing in mindthat it is a criminal offence to serveas a trustee if disqualified fromdoing so.

• The current position on performanceof checks on new trustees isunsatisfactory.

• The Charity Commission will publishguidance clarifying and publicisingthe obligation on trustees to checkthe eligibility of new trustees, andgiving practical advice on how to doso.


All trustees must act - and be seen to act- in the best interests of the charity andnot for their own private interest or gain.There may be situations where atrustee’s own interests and the interestsof the charity arise simultaneously orappear to clash. For example, aneducational or housing charity might beproviding direct or indirect benefit to apotential trustee or a family member.

Considering alternative roles forpeople who are disqualified from

acting as trustees - Case study

This case highlights that individualsvalued by a charity and considered asprospective trustees can stilleffectively contribute to theorganisation’s work, despite the factthey are disqualified from acting as atrustee under the Charities Act 1993.

• The trustees of a medium sizedcharity approached the CharityCommission applying for a waiverin relation to a prospective trustee,who was disqualified from takingup the post under section 72 (1)of the Charities Act 1993. Thecharity valued the work,commitment and enthusiasm theindividual had shown and wantedher to become a trustee.

• Ultimately, the case that thetrustees presented to theCommission was not sufficientlystrong for us to grant the waiverwhen considered against thenature and circumstances underwhich the prospective trustee wasdisqualified from acting. However,although our decision meant thatthe prospective trustee could notaccept the office at this time, it didnot stop her from contributing tothe charity through othervoluntary channels.

• Charities should think about therange of roles, in addition totrusteeship, within theirorganisation and how they can bedeveloped to attract and retainpeople. Roles will vary dependingon the size and nature of thecharity, possibilities includepatrons, ambassadors, advisersand volunteers.

1 6

1 7


• All charities should have in placearrangements for identifying andmanaging conflicts of interest andensure that their trustees are awareof these arrangements.

• It is good practice to ensure thatpotential new trustees consider thequestion of possible conflicts ofinterest before there is commitmenton either side. This is particularlyimportant where personal interestsmay be significant enough to makeit difficult for the individualconcerned to make a full androunded contribution to the board’sdiscussions and decisions.

The issue is not the integrity of thetrustee concerned, but the charity’smanagement of any potential overlap orconflict of interests. Not all conflicts ofinterest (including those mentionedabove) stand as a bar to service as atrustee - that will depend on thecircumstances, including the size andnature of the benefit at issue. It willoften be enough for a trustee towithdraw from discussions and decisionswhich closely involve their interests, orsimply to declare interests which aremore general or indirect so thateveryone is clearly aware of them.Dealing with a conflict of interest iscovered in a number of Commissionpublications; however, the Commissionintends to issue further specific guidanceon this subject towards the end of 2002.

It is vital that all charities havearrangements in place for spotting anddealing with potential conflicts ofinterest and ensure that their prospectiveand new trustees are aware of thesearrangements. An open approach topotential conflicts of interest, whichincludes recognising, acknowledgingand managing the issue in a transparentand efficient manner, can help to meetgood practice guidelines and protect thereputation of the charity.

Identifying and dealing withconflicts of interest - Case study

This case highlights the steps taken bya large charity to spot, manage andaddress conflicts of interest.

• A large charity, providingeducational services for women,tackles conflicts of interest in itsinduction booklet. New trusteesare asked to declare any financialor personal interests they hold inrelation to organisations or

contracts, which may relate towork undertaken by the charity.The Secretary or her nomineeskeep a note of all disclosures ofinterests in a register.

• If an actual conflict of interestarises the trustee is asked todeclare the interest and withdrawfrom the meeting until discussionof the item and voting has beencompleted. Any votesinadvertently cast in contraventionof the disclosure provisions arenot counted.

• The charity has found thateffective tackling of disclosure andconflicts of interest requirementscontributes to the development ofmore open and transparent waysof working, which helps meetgood practice guidelines andserves to protect the reputation ofthe charity.

User trustees

Users on board - Case study

A charity developed user trusteeshipas a way of furthering its objectswhilst enhancing its own services.

• A large mental health charityoperates an innovative user trusteeprogramme. The charity’sgoverning document makesprovision for a number of peoplewho use the charity’s services toact as trustees and has found thathaving users as trustees hasbought it many benefits; it hasacted as a catalyst for enhancingthe charity’s effectiveness andefficiency by providing moreresponsive, better services tousers.

• The programme is clearly definedand treats the period oftrusteeship as an experience thatcan provide a method of therapyfor some of the user trustees.

• Running the programme doescarry time and financial resourceimplications for the charity, whichit considered and addressedbefore beginning the programme.Overall, this charity has found thatthe programme has benefitedusers of the charity’s services in aunique way whilst contributing tothe development of the charity.

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User trustees

In principle, the Commission welcomesuser trusteeship, as user trustees canenhance the effective management ofthe charity and have a positive impacton the delivery of its services. Theinclusion of users (ie anyone who uses orbenefits from a charity’s services) can alsohelp to ensure a more diverse andrepresentative board.

However, whether to include users astrustees is a decision that each charityshould consider based on its owncircumstances and needs. Both for usertrustees and for trustees more generally,charities may need to take particularcare about the possibility of conflicts ofinterest between a trustee’s personalinterest and those of the charity and tohave in place clear policies andprocesses for demonstrating that anypotential conflict has been avoided.Depending on the nature of the charity,users can have a range of potentialinterest, and the existing trustees needto consider carefully who is a user, and(for trustees more generally) where aconflict of interest might arise. Therealso needs to be a suitable provisionwithin the charity’s governing documentto allow a user trustee to receivebenefits from the charity. TheCommission’s published guidance Userson Board (CC24), and The PublicCharacter of Charity (RR8), which canbe viewed atwww.charitycommission.gov.uk ,provide further information.

• Charities should consider whetheruser trustees could improve theireffectiveness and responsiveness.Potential conflicts of interest need tobe carefully considered, but willusually be manageable.

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Induction

The results of the NOP survey suggestedthat charities may need to do more toinduct new trustees. Only 22% ofcharities provided an inductionprogramme or tour. The chances of anew trustee receiving some form ofstructured induction rose with the sizeof the charities surveyed, reflecting theirincreased scale and structuralcomplexity. Seventy-five per cent (75%)of very large charities confirmed theycarried out a formal tour/inductioncompared to just 14% of small charities.

Regardless of their size and nature, allcharities need to consider the needs ofnew trustees by providing an inductionprogramme that is proportionate to thecircumstances of the trustee and thecharity, and that equips them with theinformation and tools they need tobecome effective and valuable boardmembers as quickly as possible.

All trustees, as part of their induction,should receive a copy of the charity’skey documents and an explanation oftheir purpose and effect.

The requirements for an inductionprogramme will vary depending onindividual charities needs andcircumstances. Smaller and morestraightforward charities may find that adiscussion with existing trustees is asuitable way for a new trustee to learneverything they initially need to know tobegin their trusteeship effectively. Thechair of the trustee board can play a keyrole in introducing a new trustee to thecharity. Larger and more complexcharities may find it useful to have amore systematic induction programme,including meetings, visits andcomprehensive reading material.

Induction in larger charities -Case study

This case highlights the main stepsand tools used by a very large charityto ensure that its new trustees arewelcomed and inducted effectivelyinto the organisation.

• The charity employs a part-timetrustee officer, who is responsiblefor supporting the inductionprocess. A checklist, covering allthe areas of the charity’s work, isused as a basis for creating aninduction programme tailored tosuit the needs of the new trustee.

• The trustee officer meets with thenew trustee as soon as possibleafter his/her appointment, in orderto discuss induction needs and todistribute key information, such asthe charity’s governing document,accounts and minutes frommeetings. A copy of our booklet,Responsibilities of CharityTrustees (CC3), organisationalcharts and information about thecharity’s policies are also provided.

• The induction programme ensuresthat the new trustee meets withkey charity personnel and ensuresthat any conflicts of interest aredeclared. The charity’s trusteenominating committee appoints anexisting trustee to act as a mentorfor the new trustee.

• Additionally, the charity has puttogether its own “Trustee Guide” tosupport the induction programme.It contains a comprehensiveoverview of the history and workof the organisation and informationabout the roles and responsibilitiesof being a charity trustee.

Information every new trustee needs

• Most smaller charities, andsignificant numbers of larger ones,need to do more to provide astructured induction for new trustees.

Information every new trusteeneeds

Becoming a trustee of a charity bringswith it specific responsibilities, of whichnew trustees need to be aware. Inparticular, trustees must have access tothe information they need to be able tosatisfy themselves that the funds andassets of the charity have been properlyadministered. All trustees, as part oftheir induction, should receive an“induction pack” containing a copy ofthe charity’s key documents (usually thecharity’s governing document, latest setof annual accounts and copies ofminutes from previous meetings)accompanied by an explanation of theirpurpose and effect. In more complexcharities details of other trustees, seniorstaff, management structure etc will helpthe new trustees find their feet. If thecharity has a strategic plan, a visions andvalues statement or similar, then thisshould also be made available to thenew trustee.

Worryingly, the NOP survey revealedthat overall only 55% of the charitiessurveyed automatically supply theirtrustees with a copy of the charity’sgoverning document. Forty-eight percent (48%) of small charities providednew trustees with a copy of theirgoverning document, compared to 86%of very large charities. In some cases,where charities have particularly largeand complex governing documents, thedocuments themselves, without furtherexplanation, might not be effective ininforming new trustees about thecharity’s purposes and key arrangementsfor its governance and administration.

But the survey figures, particularly forsmaller charities, give cause for concernthat charities may not consistently beproviding new trustees with these keyitems of information.

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What charities providefor new trustees

Charity accounts

Minutes of previousmeetings

The charity’s governingdocument

A formal tour/inductionprocess

Not stated

70%

60%

50%

40%

30%

20%

1 0 %

Charities should give latest accountsand, if necessary, help withunderstanding their layout and content,to new trustees, together with minutesfrom previous trustee meetings. Theseare necessary to help the new trusteegain an understanding of the charity’sfinancial position and an awareness ofthe resource issues it is facing.According to the NOP, 69% of charitiesprovided accounts to new trustees, and63% provided minutes of previousmeetings. Whilst these figures are anadvance on those for the provision ofthe governing document, they suggestthat good practice could be moreconsistently applied. Again largercharities fare better, with 91% of newtrustees provided with accounts.

• Charities should provide all trusteeswith sufficient induction material toallow them to understand theircharitable purposes, financialposition and current issues. The

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Trustees ability to assert their authority

Trustees need to “hold their own” -Case study

This case highlights an instance wherea dedicated group of trustees wereunable to assert their authoritybecause a lack of proper inductionmeant they were unable to fullyunderstand their role.

• A large charity operating in thefield on mental health got intosevere difficulties and became thesubject of a Commission inquiry.The charity was quite complex, itowned property, employed arange of staff, had contracts todeliver some services, and wasdealing with vulnerablebeneficiaries.

• The trustee body, whilst dedicatedto the charity and its beneficiaries,had a very narrow range of skillsand was largely static. There waslittle or no induction or ongoingtraining for trustees. This left thetrustee body ill equipped to runsuch a complex organisation andthey relied almost exclusively onthe guidance and direction of thecharity’s senior staff.

• When trustees lack the skills andconfidence to in any waychallenge what they are told thenthey are ineffectual and becomemarginalised; even if on the faceof it they appear to be active inthe affairs of a charity.

• Financial irregularities andcontractual problems developedthat led to a crisis that the trusteescould not deal with. They wereunable to take control of thesituation and continued to rely

NOP survey suggests that moreconsistent application of this bestpractice is required, mainly bysmaller charities, but also by some ofthe largest.

• Induction material should alwaysinclude the charity’s governingdocument, in addition to accounts,with explanatory material wherenecessary, and recent minutes oftrustee meetings.

Trustees’ ability to assert theirauthority

Trustees need to work together as ateam to ensure their charity is runeffectively and efficiently. As a body, thetrustee board should contain peoplewho collectively have the skills andconfidence that will enable the charity toconfront and challenge any issuesaffecting it. This means that boardsshould work to avoid situations whereknowledge, or an excessive degree ofinfluence, is held in the hands of aselect few (who may not be trusteesthemselves). An effective inductionprogramme can equip a board to fulfilits role. In our experience, boards thatdo not have an appropriate inductionprogramme are less able to “hold theirown” when faced with a challenge totheir authority. These boards often runinto difficulties that may lead to ourintervention.

• Good induction will help trustees toassert their authority and face up toany challenges their charity mayface.

Securing charity property

Situations can arise where the propertyof an individual trustee becomesentangled with that of the charity. Forexample, a trustee might let a charityuse his/her home as the charity’spremises. A clear understanding of thisissue, which in its broadest sense is aconflict of interest, at the very outset ofa trustee’s appointment is important.When first taking office a new trusteeshould familiarise his/herself with thecharity and should take steps to “securethe property”. This may mean having toregularise any outstanding propertyissues; a failure to do this will simplyperpetuate a problem.

• By properly examining the affairs oftheir charity a new trustee will bemade aware of, and take steps tocorrect, any outstanding problemsrelating to the assets of the charity.

• It is vital that a clear distinction isdrawn between the charity’sproperty and the individual’sproperty and that the two areproperly separated at the beginningof a trustee’s term.

Securing charity property

exclusively on direction fromoutside the trustee body. TheCommission appointed additionaltrustees and, having secured thefuture of the beneficiaries, thecharity is no longer operating.

Ensuring the property of thecharity is secured - Case study

This case highlights some problemsthat can arise when there is no cleardistinction between charitableproperty and private property.

• The founders of a small charitybought a piece of land from whichthey planned to operate thecharity. The land remained in thenames of the founders instead ofbeing properly conveyed to thecharity.

• Some time later a dispute brokeout between the trustees of thecharity. Part of the disputeinvolved the use and developmentof the charity’s property. Thefounders of the charity, who werenow acting as trustees, viewed theland as their private property andtreated it as such, which inflamedthe dispute. Our intervention wasrequired in order to clarify andregularise the issue.

• The land, which had been boughtfor charitable use, was properlyconveyed to the charity and vestedin the Official Custodian forCharities (OC) to safeguard it forthe future. This removed the mainelement of the dispute and officersfrom the Commission worked withthe trustees and charitymembership to resolve the otheroutstanding issues.

• The failure, not just of thefounding trustees, but also theirsuccessors to address andregularise the status of the landmeans the trustees failed touphold the duty of care principle.All new trustees must take steps tosecure the property of the charityupon their appointment; a processwhich should be explained andthe appropriate informationsupplied, to enable trustees to dothis during their induction period.

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Training for new trustees

For charities, trustee induction providesan opportunity to provide new trusteeswith the basic information and trainingthey need to begin their appointment aseffectively as possible. Induction shouldbe seen as forming part of the broaderremit of trustee training anddevelopment. Although not dealt with inthis report, the issue of on-going trusteetraining and development is one whichis intrinsically linked to ensuring theeffective running of the charity,including the recruitment, selection andinduction of trustees.

It is likely that prospective trustees willfind the availability of further trainingopportunities after the initial inductionhas ended an attractive and reassuringprospect, and training may help to retaingood trustees in charities which havesuffered from trustee retention problemsin the past. Using ongoing training toequip trustees with additionalknowledge and skills designed to meetthe needs of the charity, and reflect thedifferent positions of trustees, is oneway of helping to ensure the charityruns effectively and efficiently.

There is a wealth of guidance availableto charities, but the survey results clearlyshow that a substantial number do notappear to be using recommended goodpractice tools or meeting good practicerecommendations. A possible responseto this situation is to develop trainingpackages which will enable trusteesnavigate their way to and through theavailable guidance, meeting their needsand those of their charity moreeffectively and efficiently. Accreditingthe training, making it user friendly andaccessible through a broad range ofmediums including the Internet, wouldgive charities confidence in the productand carry weight.

Training for new trustees

• There is scope for the developmentof better and more comprehensivetraining material for new trusteesand others in the basic requirementsand skills of trusteeship. Sectorbodies and funding agencies shouldconsider how the development ofsuch training could be financed andhow it could be made most widelyavailable.

• Ideally, such training should becapable of leading, or contributing,to an accredited qualification, andshould be available in a variety offorms, including as distancelearning.

• The Commission stands ready toparticipate as a partner in thedevelopment of such trainingmaterial, and particularly to helpassure the soundness andcompleteness of its technical contentdealing with matters of charityfinance, governance and propriety.

• As an interim measure, there isscope for current providers oftraining material for trustees topublicise, and the CharityCommission to co-ordinate and“signpost” it more effectively.

Evaluating recruitment andinduction

If trustees adopt a more formalapproach to recruitment selection andinduction, adopting the best practiceguidelines that are appropriate to theircharity, then that is not the end of theprocess. As with all aspects of thecharity’s work the trustees need tomonitor the effectiveness of the systemand make changes to keep it fresh andrelevant.

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Evaluating recruitment and induction

Trustees should bear in mind therequirements of their charity whenconsidering this process. Smaller andsimpler charities are likely to find thatthey can use more informal methods ofmonitoring and revising policies relatingto the overall development of the trusteeboard than larger and more complexcharities. Larger charities shouldconsider adopting a system that meetsthe needs of the organisation, takinginto account the charity’s widerarrangements for business planning,output targeting and assessment.

• Charities should seek to establishsystems of evaluation and review sothat they can measure theeffectiveness of the recruitment andinduction arrangements they haveadopted.

Annex A

Survey techniques

As at August 2001, the Commission held details of just over 739,000 individuals currentlyacting as a trustee of a registered charity. Some of these will be trustees of more than onecharity. This figure excludes trustees of unregistered and exempt charities. Overall, weestimate that there are currently over a million trustee positions in England and Wales.

During summer 2001, a random sample of 3000 charities was taken from the Commission’sregister. The sample was taken across four income bands:

Small £10,000 or lessMedium £10,001-£250,000Large £250,001-£999,999Very large £1,000,000 plus

NOP were commissioned to carry out a postal survey of the trustee recruitment, selectionand induction practices in the selected charities. The initial phase of the survey consisted ofa postal questionnaire, which was developed jointly between the Charity Commission andNOP.

The postal survey achieved a 47% return rate, which is high for surveys of this nature. Intotal 1401 completed forms were returned to NOP for analysis.

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Charity size and proportions sampled and returned

Size of charity Income band % in % selected % intotal register for mailing return

Small £10,000 or less 65 50 45

Medium £10,001 - £250,000 30 30 30

Large £250,001 - £999,999 4 10 11

Very large £1,000,000 plus 2 10 13

The second phase of the survey was to carry out in-depth telephone interviews using ascript developed jointly between the Charity Commission and NOP. Fifty charities, coveringthe chosen income bands, were interviewed in an attempt to explore in more detail issuesrelating to trustee recruitment, selection and induction.

During this period seminars were arranged with staff in the Charity Commission to discussissues and experiences arising from trustee recruitment, selection and induction practices.Illustrative studies relating to practices in charities were obtained from the CharityCommission’s rich casework archive. Meetings with charities were also held to help gatherinformation about trustee recruitment, selection and induction.

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Survey findings - Trustee recruitment and selection

Open questions, or those where a charity could choose more than one option predominate.Tables 5, 11, 12 and 14 show the results of questions where the charity could give only oneanswer and therefore these are the only tables where the aggregate score equals 100%.

How many trustees do you have?

Charities were asked to confirm the size of their present trustee board and to state what theythink the ideal number of trustees for their charity is.


How are trustees appointed?

Charities were asked to confirm how new trustees are appointed.

Table 1: Current number of trustees and ideal number of trustees

Number of trustees Current Ideal% %

1-5 46 42

6-10 33 32

11-15 13 15

16+ 7 7

Don’t Know 1 4

What do people get from being a trustee?

During in-depth interviews charities were asked to explain what they felt people gainedfrom trusteeship. Many charities agreed that acting as a trustee is personally fulfillingbecause it enables people to contribute to a cause which they have a particular interest in,for example:

Table 2: How trustees are appointed. Percentage of charities that have one or moretrustees appointed by each method

Method of appointment Total Small Medium Large Very large% % % % %

Elected 49 46 53 53 53

Nominated or co-opted by current trustees 51 44 60 78 71

Appointed by another body 20 20 19 19 28

Appointed by virtue of a position held elsewhere 31 35 24 22 25

Not stated 2 2 1 1 -

“Personal satisfaction that they have done something worthwhile”.

“The pleasure of being associated with a business-like and valuable charity”.

“There is some satisfaction in helping a charity and getting involved in the third worldand donating time and perhaps money or resources to the charity”.

Is it more difficult to recruit trustees today?

A range of charities were asked to comment during in-depth interviews whether they felt itwas more difficult to recruit new trustees today than it was five years ago.


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The interviews uncovered a range of views, for example:

“I don’t think five years has made much of a difference”.

“There are intense time pressures everywhere, both in business and academia. Peoplesimply can’t spare the time”.

How often do charities recruit new trustees?

We asked charities to confirm the frequency with which they appointed new trustees.

Table 4: Frequency of recruitment

Frequency Total Small Medium Large Very large% % % % %

Twice a year 1 1 1 2 3

Annually 31 28 31 26 23

Every 2-5 years 9 11 8 13 17

When the need arises or to keep numbers up 12 9 15 14 12

Always/constantly 5 3 7 12 8

Rarely need to/hardly ever 4 4 4 4 6

Never/don’t need to 8 10 5 2 1

As vacancies occur 13 11 15 17 14

Due to retirement/resignation/death 22 22 22 18 22

Table 3: Difficulty of recruiting compared to 5 years ago

Difficulty Total

Base: All in-depth interviews 5 0

Same 48%

Worse 36%

Easier 6%

Don’t Know 10%

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Reasons for recruiting within five years


In-depth interviews probed why some charities recruit new trustees within a five-yearperiod. The main reason given was that it is a requirement in the charity’s governingdocument. Other reasons included:

“Simply because people indicate that they want to stand down”.

“New people have new ideas”.

“Brings new blood into the charity”.

Lack of knowledge and continuity were seen as the biggest disadvantages of recruitingtrustees at intervals of less than five years.

Reasons for recruiting after more than five years

In-depth interviews also explored the experiences of charities that do not recruit newtrustees frequently. The main reason was that the regular recruitment of new trustees wasnot a requirement of the charity’s governing document. Other reasons included:

“We are happy with our trustees that we have at the moment and can see no reason tochange them”.

“People build up experience”.

“Greater continuity in carrying forward a strategic plan”.

A lack of new input and new initiative were seen as the biggest disadvantages to recruitingnew trustees on an infrequent basis.

How difficult is it to recruit new trustees?

Charities were asked to indicate if they ever faced difficulties in recruiting and selecting newtrustees.

Table 5: Survey findings - Trustee recruitment and selection

Difficulties faced Total Small Medium Large Very large% % % % %

Always 12 11 14 9 5

Sometimes 31 27 36 45 50

Never 53 57 48 45 44

Not stated 4 5 2 1 2


What difficulties are experienced in recruiting new trustees?

Charities were asked to indicate if they experienced any difficulties when recruiting newtrustees.

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In-depth interviews explored with charities the main difficulties they faced in recruiting newtrustees.

“People nowadays do not want the commitment and responsibility”.

“The people who are willing to serve may not have the skills you are looking for”.

Ways of overcoming difficulties

Charities were asked what methods they had used, or would consider using, to help themrecruit new trustees.


Difficulties Total Small Medium Large Very large% % % % %

Insufficient applicants/shortage of candidates 14 18 9 9 5

Finding people who are willing to make thecommitment or have time 35 29 43 42 58

Finding people who have the necessary skills/experience 12 5 16 41 52

People do not want the responsibility 11 10 14 10 4

Finding people who are interested 9 8 10 8 4

Finding younger people/current trusteesare elderly 7 7 9 2 4


Methods used Total Small Medium Large Very large% % % % %

Persuasion 16 21 10 5 5

Asking/approaching suitable people 10 10 10 6 4

Word of mouth 7 6 6 17 18

By asking members/people already involved inthe organisation 6 4 8 7 6

Personal contact 5 4 8 5 8

3 0


Why some charities do not face problems recruiting trustees

We asked charities to indicate why they perceived they did not face difficulties whenrecruiting new trustees.


Total Small Medium Large Very large% % % % %

People are interested in the aims ofthe organisation 12 11 15 21 9

We are a small group/organisation/church 12 13 10 - 8

Members are always willing to become trusteesor are automatically trustees 19 20 19 23 15

Service users willing to join/parents/parishioners/congregation 8 8 10 6 7

Large number/pool of people to choose from 8 7 9 15 20

All ex-officio trustees 9 11 5 1 5

Small duties involved 6 8 2 4 -

Existing trustees recommend somebody 5 5 5 4 8

Appointments are made through bureau/local authorities 4 5 2 1 7

We are a small village/town 4 5 3 - -

We have long serving trustees 4 4 5 1 3

Appointments are made through parish/branches 4 5 3 - 1

Suitable/high calibre experienced peopleavailable 3 2 5 8 12

It is a matter of prestige/honour to be a trustee 2 2 1 6 11

Good reputation of charity/organisation 1 * 1 6 17


How do charities attract new trustees?

Charities were asked to confirm what methods they used to attract new trustees.

In-depth interviews were used to explore with charities in more detail the various methodsused to attract new trustees.

“Initially, individuals are asked to come to a meeting with existing trustees present andsee if it is to their liking”.

“Generally, because somebody knows somebody, who they think could be a goodperson”.

“Prospective trustees are usually approached at meetings or social events”.

“The organisation and what it stands for is really what spurs members on to stand forelection”.

Tools to assist recruitment

Charities were asked to confirm if they prepared in advance tools to assist the recruitmentand selection process.

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Methods used Total Small Medium Large Very large% % % % %

Word of mouth and personal recommendation 68 63 74 84 85

Networking with other charities 6 3 11 20 14

Trustees are elected from the membership 6 6 7 5 8

Advertising in the press 3 2 5 11 11

Use of trustee brokerage service 1 * 1 2 3


Activities Total Small Medium Large Very large% % % % %

A skills audit of trustees 11 6 15 40 41

Provide trustee job descriptions 18 13 26 37 36

Use a dedicated recruiting committee 6 6 5 7 12

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Formal checks

Charities were asked to confirm whether they made any checks on prospective trusteesprior to appointment.

Charities with elected trustees

Charities with elected trustees were asked to confirm how often the same people were re-elected.

In-depth interviews probed the issue of re-election in more detail.

“The only reason we don’t recruit is because we can’t find anybody to recruit, that’s theproblem”.

“We don’t have any requirement in our trust deeds for regular re-appointment of trusteesso people serve indefinitely until they cease to be trustees”.


Are checks made? Total Small Medium Large Very large% % % % %

Yes 33 28 41 40 55

No 59 63 53 54 39



Frequency of re-election Total Small Medium Large Very large% % % % %

Always 32 32 33 29 35

Sometimes 62 62 61 68 59

Never 4 4 4 - 4


Survey findings - Trustee induction

Survey findings - Trustee induction

What information are new trustees provided with?

Charities were asked to confirm if, as a matter of course, they provided new trustees withkey pieces of information about the charity.

3 3

“A copy of anything and everything”.

“They will have talks about what they might bring and what they hope the outcome oftheir term will be, but there is no structured induction”.

“The type of people we are taking on as trustees have probably got all the skills theyneed to run the charity”.

Is the appointment of a new trustee formally recorded?

Charities were asked to confirm if they recorded the appointment of a new trustee in thecharity’s record or minutes book.

Table 13: What do charities provide for new trustees?

Information Total Small Medium Large Very large% % % % %

Charity accounts 69 63 78 86 91

Minutes of previous meetings 63 58 71 78 81

The charity’s governing document 55 48 66 81 86

A formal tour/induction process 22 14 31 57 75


Table 14: Is the appointment of the new trustee formally recorded?

Total Small Medium Large Very large% % % % %

Yes 80 76 86 91 95

No 15 17 11 8 3

Not Stated 5 6 3 1 2

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Annex B

Resources for trustees

There are many resources which charity trustees can tap into to help them with recruitment,selection and induction issues. While this is not a definitive list of all the sources ofinformation available, it does offer a good overview and a useful starting point.

Organisations

These organisations can provide you with a wide range of help, support and information.

n The Charity Commission for England and Wales

Responsibility for charities is split between our four offices. Further information can be obtained fromthe Commission at:

London Liverpool Taunton NewportHarmsworth House 2nd Floor Woodfield House 8th Floor13-15 Bouverie Street 20 Kings Parade Tangier Clarence HouseLondon Queens Dock Taunton Clarence PlaceEC4Y 8DP Liverpool L3 4DQ Somerset TA1 4BL Newport NP19 7AA

Tel: 0870 3330123Minicom: 0870 3330125E-mail: [email protected]: www.charitycommission.gov.uk

n National Council for Voluntary Organisations (NCVO)

Extensive information available on all the issues covered in this report and a wide range ofsupport services.

National Council for Voluntary OrganisationsRegent’s Wharf8 All Saints StreetLondon N1 9RL

Tel: 0800 2798798E-mail: [email protected]: www.ncvo-vol.org.uk

n National Association for Councils for Voluntary Service (NACVS)

The NACVS network provides a wide range of information and support for charities.

National Association for Councils for Voluntary Service3rd Floor Arundel Court177 Arundel StreetSheffield S1 2NU

Tel: 0114 278 6636E-mail: [email protected]: www.nacvs.org.uk

n Directory of Social Change (DSC)

The Directory promotes positive social change and provides a wide range of resources fortrustees.

London Liverpool24 Stephenson Way Federation HouseLondon NW1 2DP Hope Street

Liverpool L1 9BW

Tel (Books): 020 7209 5151Tel (Training and Events): London 020 7209 4949 & Liverpool 0151 708 0117E-mail (Training and Events): London [email protected] &Liverpool: [email protected]: www.dsc.org.uk

n Institute of Chartered Secretaries & Administrators (ICSA)

ICSA provides information and good practice guidance on governance issues affecting thesector. They also have a trustee register (see below) available to charities needing newtrustees.

16 Park CrescentLondon W1B 1AH

Tel: 020 7580 4741E-mail: [email protected]: www.icsa.org.uk

Organisations

3 5

n BoardSource

This American organisation, formerly the National Center for Non-Profit Boards (NCNB)provides a wealth of good practice advice on issues concerning trustee governance. Thewebsite is comprehensive and there is an e-mail facility for specific queries on increasingthe effectiveness of your organisation.

Website: www.boardsource.org

n Charity Trustee Networks

This charity offers trustees mutual support by encouraging and developing self-help trusteenetwork groups providing cost effective, peer-to-peer consultancy and mentoring.

PO Box 633Godalming GU8 5ZX

Tel/fax: 01428 682 252E-mail: [email protected]: www.trusteenetworks.org.uk

n VolResource

This Internet-only resource for charities offers quick links to useful organisations concernedwith the effective running of charities.

E-mail: [email protected]: www.volresource.org.uk

n Association of Chief Executives of Voluntary Organisations (ACEVO)

ACEVO provides good practice resources and information on sector issues.

ACEVO83 Victoria StreetLondonSW1H 0HW

Tel: 0845 345 8481E-mail: [email protected]: www.acevo.org.uk

Organisations

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n Ethnic Minority Foundation (EMF) & the Council of Ethnic Minority VoluntaryOrganisations (CEMVO)

EMF and CEMVO develop resources for black and minority ethnic organisations, theseinclude networking and training opportunities and a trustee register.

Boardman House64, BroadwayStratfordLondon E15 1NG

Tel: 020 8435 0000 or Freephone: 0800 6520390E-mail: [email protected]: www.ethnicminorityfund.org.uk

Journals, magazines and newspapers

The following publications often cover issues relevant to trustee recruitment, selection andinduction.

n Charity Times

Website: www.charitytimes.comSubscriptions: 020 7426 0496/0123

n Voluntary Sector

Contact NCVO for details.

n Third Sector

Subscriptions: 020 8709 9050

n Charity Finance

Subscriptions: 020 7819 1204

Journals, magazines and newspapers

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n Charity Management

Write to the address below for subscription information:

Mitre House PublishingThe Clifton Centre110 Clifton StreetLondon EC 2A 4HD

n The Guardian - Society section on Wednesdays

Website: www.SocietyGuardian.co.uk

Trustee registers and brokerage services

NCVO free booklet Trustee bank: A directory of trustee brokerage services details a range oftrustee finding services. Trustees can also refer to magazines and journals to checkadvertisements for trustee brokerage services and consider contacting their local Council forVoluntary Service (CVS) office for further information. ICSA and EMF also offer trusteeregisters - see above for contact information.

Books and other publications

The following resources are a good starting point on the general issue of trusteerecruitment, selection and induction, which are covered in this report. A more detailed listof books and other publications can be found in the bibliography section.

Akpeki, T. (2001) Recruiting and supporting black and minority ethnic trustees , NCVO,London.

Ashby, J. (1997) Towards voluntary sector codes of practice , Joseph Rowntree Foundation,York.

Cairns, E. (1997) Charities: law and practice , Sweet & Maxwell, London.

Charity Commission, Responsibilities of charity trustees (CC3) , Charity Commission, London.

Charity Commission, The hallmarks of a well-run charity (CC60) , Charity Commission,London.

Charity Commission, Users on board: beneficiaries who become trustees (CC24) , CharityCommission, London.

Trustee registers and brokerage services

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Books and other publications

Charity Commission: Trustee responsibilities (available on the Commission’s Website), CharityCommission, London.

Cornforth, Chris. (2001) Recent trends in charity governance and trusteeship , NCVO,London.

Directory of Social Change, (1994) How to be a better trustee (Part 1: roles andr e spons ib i l i t i e s ) .

Eastwood, M. (2001) The charity trustee’s handbook , Directory of Social Change, London.

Ford, K. (1993) The effective trustee: roles and responsibilities , Directory of Social Change,London.

Ford, K. (1992) Trustee training and support needs , NCVO, London.

Hind, A. (1995) The governance and management of charities , The Voluntary Sector Press,High Barnet.

Hudson, K. (1999) Managing without profit , Penguin, London.

The College of Law: Legal Network TV (2001) Charities: tools for trustees, LNTV, London.

Luxton, P. (2001) The Law of Charities, Oxford University Press.

NCVO (1999) The good trustee guide, NCVO, London.

NCVO (1992) On trust: increasing the effectiveness of charity trustees and managementcommittees, NCVO, London.

NCVO (1997) Getting on board: strategies for finding and supporting trustees; Trusteebriefing No. 4 .

Palmer, P., and Harrow, J. (1994) Rethinking charity trusteeship, ICSA, London.

Picarda, H. (1995) The law and practice relating to charities , Butterworths, London.

Quint, F. (1999) Running a charity , Jordans, London.

Warburton, J. (1995) Tudor on Charities , 8th Ed., Sweet & Maxwell, London.

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Annex C

Bibliography

ACEVO, (1998) Partners in leadership: towards a new style of governance and managementfor professionally managed charities, ACEVO, London.

Akpeki, T. (2001) Recruiting and supporting black and minority ethnic trustees, NCVO,London.

Akpeki, T. Getting the best board. In Vision (supplement to Voluntary Sector) August-September 2001.

Akpeki, T. What dreams may come. In ThirdSector Trustee February 2001.

Arnott, J. Thirst for knowledge. In ThirdSector Trustee February 2001.

Ashby, J. (1997) Towards voluntary sector codes of practice, Joseph Rowntree Foundation,York.

Burnett, K. Trusteeship. In ThirdSector May 17 2001.

Butler, T. Fully fledged? In ThirdSector June 29 2000.

Butler, T. Sounding boards . In ThirdSector Trustee February 2001.

Cairns, E. (1997) Charities: law and practice, 3rd Ed., Sweet & Maxwell, London.

Canavon, M and Smith, P. (2001) Representing the people ; democracy and diversity, LocalGovernment Association, London.

Charity Commission (2004), Registering as a charity (CC21), Charity Commission, London.

Charity Commission (2003), Choosing and preparing a governing document (CC22), Charity Commission,London.

Charity Commission (2000), Users on board – Beneficiaries who become trustees (CC24), CharityCommission, London.

Charity Commission (2004), The hallmarks of an effective charity (CC60), Charity Commission, London.

Charity Commission (2002) Responsibilities of charity trustees (CC3), Charity Commission, London.

Charity Commission (1999) Making a scheme (CC36), Charity Commission, London.

Cornforth, Chris. (2001) Recent trends in charity governance and trusteeship, NCVO, London.

Directory of Social Change, (1994) How to be a better trustee (Part 1: roles and range).

Eastwood, M. (2001) The charity trustee’s handbook, Directory of Social Change, London.

Ford, K. (1992) Trustee training and support needs, NCVO, London.

Harris, M and Rochester, C (2001), Governance in the Jewish voluntary sector, Institute forJewish Policy Research, London.

Hill, N. When service users enter the board room. In The Guardian/Society February 1 2001.

Hill, N. In the line of fire. In The Guardian/Society May 17 2000.

Hind, A. (1995) The governance and management of charities , The Voluntary Sector Press,High Barnet.

HLB Kidson in association with NGO Finance (2000) Voluntary sector governance survey2000, Plaza Publishing Limited.

Hudson, K. (1999) Managing without profit, 2nd Ed., Penguin, London.

ICSA (1999) The appointment and induction of charity trustees, ICSA, London.

James, J. Fresh targets. In The Guardian/Society April 18 2001.

Laurance Linda Trustees and Conflict Management , Croner CCH Voluntary OrganisationsBriefing, Issue 106 February 2001.

Legal Network TV. (2001) Charities: tools for trustees , The College of Law, London.

Luxton, P. (2001) The Law of Charities, Oxford University Press.

Maggs, L. Making the difference. In ThirdSector May 17 2001.

McCurry, P. Charities give volunteer trustees the cold shoulder. In The Guardian/Society, May10 2001.

McCurry, P. Charities cast the net wider in search for trustees. In The Guardian/SocietyFebruary 1 2001.

McCurry, P. Charities must market volunteering to the young. In The Guardian/Society November 9 2001.McCurry, P. Mixing it up. In Vision (supplement to Voluntary Sector) August-September 2001.

National Center for Non-Profit Boards. What should I know before joining the board? NCNB. Ask NCNB.

National Center for Non-Profit Boards. What goes in the board manual? Ask NCNB.

National Center for Non-Profit Boards. Board member SOS. Board Member Vol. 9 No 10

Bibliography

4 1

November/December 2000.

National Center for Non-Profit Boards. A star studded board. Board Member Vol. 10 No 2February 2001.

National Center for Non-Profit Boards. Clinging to the past - how can a new member make adifference on an old board. Board Member Vol. 8 No 6 June 1999.

National Center for Non-Profit Boards. Board checklist. Board Member Vol. 8 No 6 June1999.

National Center for Non-Profit Boards. Nonprofits offer lesson in gender diversity. BoardMember Vol. 8 No 6 June 1999.

National Center for Non-Profit Boards. Making room for improvement. Board Member Vol.10 No 3 March 2001.

National Center for Non-Profit Boards. Removing a difficult board member. Board MemberVol. 9 No 6 June 2000.

NCVO (1997) Trustee bank: A directory of trustee brokerage services: Trustee briefing No. 7,2nd Ed., NCVO, London.

NCVO (1999) The good trustee guide, NCVO, London.

NCVO (1992) On trust : increasing the ef fectiveness of charity trustees and managementcommittees, NCVO, London.

NCVO (1997) Getting on board: strategies for finding and supporting trustees; Trusteebriefing No. 4, 2nd Ed., NCVO, London.

NCVO Research Quarterly May 1999.

NCVO Research Quarterly January 1998.

National Audit Office Report Giving Confidently: The Role of the Charity Commission inRegulating Charities October 2001.

National Centre for Volunteering. Diversity challenge. www.diversitychallenge.org

National Training Organisation (1999) Management matters: management developmentneeds in the voluntary sector in Wales .

Nolan, P. Recruiting older volunteers. In Charities Management, Autumn 2000.

Parsons, R and Dyer, P. Take quality on board. In Vision (supplement to Voluntary Sector) August-September 2001.

Palmer, P., and Harrow, J. (1994) Rethinking charity trusteeship, ICSA, London.

4 2

Bibliography

Bibliography

4 3

Picarda, H. (1995) The law and practice relating to charities, 2nd Ed., Butterworths, London.

Quint, F. (1999) Running a charity , 2nd Ed., Jordans, London.

Ramrayka, L. Jewish organisations hit by volunteer shortage. In The Guardian/ Society April19 2001.

Ramrayka, L. The good guide. In Vision (supplement to Voluntary Sector) August-September2001.

Sandison, A. Recruiting trustees the easy way. In Voice March 2000.

Sandison, A. The need for a considered approach to appointing charity trustees. In CharitiesManagement, Spring 1997.

Sargent, N, and Kirkland, K. (1995) Building on trust: a study of charity trustees , NCVO,London.

Sayer, K. How to manage the relationship with trustees. In The Guardian/Society July 132001.

Sayer Vincent Building an effective trustee board. In Bulletin, Sayer Vincent.

Sweet & Maxwell’s Property Statutes (1998), 5 th Ed., Sweet & Maxwell, London.

Trowers and Hamlin. (1997) Charities: structure and governance , Trowers and Hamlin,London.

Trowers and Hamlin. (1998) Governance in question: trends for voluntary sector boards;feedback from the Trowers and Hamlins survey, NCVO, London.

Warburton, J (1995) Tudor on Charities , 8th Ed., Sweet & Maxwell, London.

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Annex D

Glossary of Terms

Trustees

Means charity trustees. Charity trustees are the people who are responsible for the generalcontrol and management of the administration of the charity, regardless of what they arecalled. You are a charity trustee if you are:

• The trustee of a charitable trust (charitable trusts can be created by a declaration of trustor by someone’s Will);

• The director of a charitable company (a charity that is a company with a memorandumand articles of association as the document which sets out how the charity is to be run);or

• A member of the committee which is responsible for running a charitable group such asa community association or a parent teacher association.

Trustee board

We use the word board to refer to a charity’s governing body.

Breach of trust

Means acting in a way which is inconsistent with the powers and duties of the trustee,whether those powers and duties are set out in the charity’s governing document, or arepart of general law.1

Governing document

In most cases the rules for running the charity will be set out in a trust deed, a will, aconstitution or the memorandum and articles of association of a company. They maysometimes (though not often) be found in a Royal Charter or an Act of Parliament. In any ofthese cases, except that of a company, there may also be one or more Schemes made by theCharity Commission or by the High Court. Whatever form the documents take in anyparticular case, they are referred to as “the governing document” in this report. 2

2 From CC21.3 From CC3.

Must

Is used to refer to actions that trustees are obliged to take, most of these are legalrequirements.

Should

Is used to suggest actions which we consider to be good practice and which we expecttrustees to follow.

Small, Medium, Large, Very large charity - NOP survey groups

• Small - Income band £10,000 or less• Medium - Income band £10,001-£250,000• Large - Income band £250,001-£999,999• Very large - Income band £1,000,000 +

Acknowledgements

We would like to thank everyone who has co-operated in the production of this report,especially the charities that gave their time to take part in the NOP survey or to speak to ourstaff. Thanks also go to Tesse Akpeki of NCVO and Linda Laurance of Charity TrusteeNetworks for their advice and support.

Glossary of Terms

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