The issue of trustees giving to their charities needs to be discussed, says our columnist
My 11-year-old nephew and I were discussing charities and how they work. He has been very active in raising funds for all sorts of causes and knows that I have had paid roles in charities, and give my time and 10 per cent of whatever money I have. I explained the role of trustees and we had the discussion about whether they are paid or not. His simple analysis was that it was not really charity if trustees got paid because that would be the same as businesses. He then asked me how much I gave to the charities where I am a trustee.
- That question really made me think. What does your organisation expect of its trustees?
American charities are much more explicit about what they expect from their trustees: patronage, munificence and connections. Trustees should also have the skills, time, passion and love of the cause that together make for a great organisation.
We are British and find it awkward to discuss personal finances and personal connections alongside the budget and the strategic plan. We readily discuss how much we need to fundraise to run our charities, and we might also discuss individual donors. We expect to give our time and to do the role to the best of our ability - but is it enough?
- My nephew's question was this: how can we ask others for money if we haven't given any ourselves?
Away from hypothetical questions and back in the real world of the charity boardroom, why can't we give to our own charities? It was different not that long ago. Looking at the records of one of my old organisations, the London Voluntary Service Council, it was common for many, although not all, board members to make donations each year. I even remember receiving the odd bequest from ex-trustees - not huge amounts, but it is significant that these people remembered an infrastructure organisation in their wills. Have we reached a level of professionalism that means we no longer consider it appropriate?
I do give money to charity, but I have only rarely given to those I give time to. I saw this approach as spreading what I have - not evenly, possibly not even fairly, but it was a way of giving support to all the causes that interest me. I have never claimed expenses for costs incurred in my trustee role, but I can't add Gift Aid to my 'donation' made in this way. Am I doing the most cost-effective thing for my organisation? I really don't know.
So what has any of this got to do with governance? I have not had the conversation with my fellow trustees about giving cash to our charities, nor have I ever raised this when running good governance courses. It is not the duty of a trustee to give money, but we do have a duty of prudence to ensure that we remain solvent and use funds reasonably to further the charity.
Furthermore, we must comply with the law and avoid conflicts of interest. On the surface, this seems like a good enough reason to avoid giving money because, as donors, we might have certain expectations about how our money is used. It could also become difficult if one board member is able to flash their cash and others are not.
Well-run organisations generally have a description of a trustee's role that includes being 'ambassadorial'. We can go out and promote our organisations, but if you are asked how much you give when asking others for money, how will you answer?
I think it is time to put a new item on the agenda for the next meeting.
Elizabeth Balgobin is chair of Voice4Change England and a charity governance consultant