Regulation with Rosie: local authority representatives

The Charity Commission's Rosie Chapman on local authority representatives.

The recent local election results will mean a change of trustees for many charities, and the historical precedent for this kind of representation goes back more than 100 years. The original thinking was that including a representative of a democratically elected body would ensure greater accountability for the charity.

The modern argument for this type of trusteeship still involves accountability, but now the emphasis might be more on accountability to the funding authority, rather than to beneficiaries.

Trustees do not operate effectively when they have conflicting interests. Many potential conflicts relate to personal business interests, but they can also be an issue for ex-officio trustees. This is particularly true when local authorities are involved, either because councils are working in partnership with charities or because elected councillors are on charity boards, in which case their priority might be accountability to their local communities rather than the charity's beneficiaries.

It's understandable that an authority providing significant funding might want a representative on the charity's board keeping an eye on results, but this solution is not always the best.

Trustees appointed by local councils will end up dealing with a whole raft of issues on many topics that might have little, if anything, to do with the work the authority funds. Don't forget, trustees should act in the interests of the charity, not their appointing body.

Performance reporting by the charity against criteria agreed with the funding authority might be a more practical means of monitoring delivery.

Or it might be more appropriate for local authority representatives to sit on working groups set up by trustees to tackle particular areas.

- Rosie Chapman is executive director of policy and effectiveness at the Charity Commission

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