Avoiding over-governance and protecting the concept of trustees
It would have been hard to miss the recent and numerous allegations directed at several UK based charities regarding sexual harassment and misconduct. The accusations and high profile coverage which followed has undoubtedly been damaging to the reputations and morale of the charities involved, and indeed the wider sector, but what has it meant for trust in charity sector governance?
In this country, we have a long-standing and strong culture of “giving something back” through public sector governance. Thousands of charities, cultural sector institutions and universities rely upon the voluntary commitment of trustees and their equivalents.
Like absolutely everything, it is not an infallible system, and it relies upon the engagement, judgment, qualifications, integrity - and sometimes luck - of its participants to maximise the chances of it working well. The same is true of most things from operating theatres to football matches, parliaments and dinner parties.
Failings of moral conduct
I don’t pretend to have a granular knowledge of exactly what has happened in the recent governance scandals in the charity sector. It certainly looks as though - at some points - there have been some clear failings of moral conduct.
I’m not sure that the evidence is available to me however to be sure that there has been a programmatic cover up, or that whole senior executive teams and their governing bodies are guilty of deliberate misconduct. And I’m not convinced that, just because a tabloid or a secretary of state says something, it makes it true.
But I can see that the implications of these recent scandals, and how we respond to them may have some unintended consequences. It is already to be seen that there is a clear decline underway in willingness to engage in pro bono activities. More and more potential trustee candidates take the view that unless there is remuneration, they will not take something on.
There is also proving to be a nervousness amongst charities about looking at potential engagement with people who have worked for, or sat on the boards of the charities which have attracted these recent scandals. It seems to have sullied an entire community. The inevitable consequence of this will be that potential trustees are more cautious about taking on roles of this nature.
As a nation, we shouldn’t sleepwalk into the death of pro bono governance. For one thing the implications will be more or less unaffordable for a huge number of charities and public organisations which are already struggling to cope with resourcing increasing costs and regulations.
Benefits of being a trustee
It might be that we need to work as a sector to do more thinking about what the benefits of being a trustee are, and becoming more articulate about, and committed to, the potential developmental aspects of governance. Being a trustee provides an opportunity to learn about a broad range of organisational issues. Clearly it is necessary to be sensible here – it is important the people who become trustees are able to contribute across the board and show the right sort of potential.
The social capital benefits are also not always acknowledged - there are allied networking benefits for trustees who make connections through involvement with boards. There are many who would find it vulgar to accept that trustees may expect something in return for their involvement but I think that the principle of exchange is going to become more and more significant. If we want to avoid remuneration being the focus, we need to become more articulate about the other benefits.
Ensuring diversity of our boards is also very important here, and there is undoubtedly an appetite from younger people and people from backgrounds which are typically underrepresented to make a positive contribution.
The other corollary that worries me is a potential increase in the regulatory burden and diligence that boards are expected to undertake. A knee-jerk set of protective measures following recent events is already emerging. Yes, it will be well meaning and it will mean to protect against such crises occurring again.
But we should be wary of the fact that more instruments of regulation will merely move governance one step further again from the end user or beneficiary. There is a danger that we spend all our time governing governance.
Normally proper board routines
Boards are routinely being asked to address difficult and sensitive issues. In good circumstances, the judgment by executives about what their board needs to know, and the questioning and probing of the trustees in return, is right. Most board meetings involved reflection on some event or matter which involves significant risk. It might range from a proposed office move, to an unpredicted financial issue, or an accusation of staff misconduct.
Decisions about how to handle these issues need to be made in the context of balancing out responsibilities to protect the integrity and propriety, financial stability, organisational health and the public reputation of the charity. Generally speaking, charity boards spend a lot of time reflecting on risk before deciding what actions to take.
I don’t mean to condone any of the clearly improper activities that have taken place in the past, nor do I mean to suggest that all governance everywhere is perfect. Like everything, good governance is a work-in-progress. It’s about relationships, engagement and considered decision making.
We should be very careful how we react as a nation to recent developments however, particularly if we think that pro bono governance is a principle worth protecting, and particularly if we want to have boards which are spending more of their time governing their charities as opposed to governing governance.