It is not hard to understand why Alan Yentob, former chair of Kids Company, spent much of his appearance before the Public Administration and Constitutional Affairs Committee hearing on the charity’s closure with his head in his hands.
He had voluntarily dedicated his time and £250,000 of his own money to the charity over the past 12 years, only to be hauled in front of MPs and given the same accusatory treatment previously meted out to the likes of Rupert Murdoch during the phone-hacking scandal.
In the following months, he was forced to resign as the BBC’s creative director and, along with his fellow trustees, was branded negligent in the committee’s final report.
The message was clear: you might be a volunteer, you might be trying your hardest and you might not have the skills but, ultimately, as a trustee the buck stops with you.
The vast majority of charities are well run and don’t face the problems of Kids Company. But with the renewed focus on governance in the wake of its closure and the fundraising crisis, the atmosphere in which the UK’s nearly one million trustees operate is changing.
Between September and October, the research company nfpSynergy, in partnership with Third Sector, Acevo and Charity Futures, conducted the National Trustee Survey to establish more detail about trustees and how their role was changing. Almost 550 trustees took part in the survey.
The results paint a mixed picture of trusteeship. They show that 81 per cent of trustees feel valued by the board and 76 per cent feel good use is made of their time. Some trustees were found to be highly committed to the sector, with 42 per cent sitting on the boards of two or more charities.
Worryingly, however, 27 per cent said they had thought about stepping down because of the requirements of the role and 23 per cent said the pressure had
become too much. Tellingly, 71 per cent said they felt that what was required of trustees was increasing.
Sir Stephen Bubb, director of the leadership and governance programme Charity Futures, believes the sector is in a dangerous position.
"People have looked at the Kids Company example and realised there are all sorts of legal requirements on trustees and if they muck up they are liable," he
says. "That’s a heavy responsibility to place on someone, particularly when they’re doing it for the love of the cause.
"At the same time, the Charity Commission has made a move to emphasise
regulation and downgrade support, so they’re ramming home the message
on responsibilities, but that support service hasn’t been replaced."
John Williams, vice-chair of the Association of Chairs, says the scrutiny faced by trustees in the past year has been "a wake-up call", but that might not be a bad thing. "Most people want to do a proper job," he says. "They don’t want to drift in and out casually; they want a level of commitment – and if they’re not up for that commitment, perhaps they’re not up to being a trustee."
According to the survey, trustees most commonly spend one or two days on charity business each month (43 per cent); 27 per cent spend between three and five days; 14 per cent spend more than five days on it; and 16 per cent use up less than one day.
Williams says charities have to think not only about "wooing trustees to get them through the door", but also about finding creative ways to ensure they are committed to the job. "There’s a duty to make it really engaging, through group activities and opportunities to meet beneficiaries," he says.
For Linda Laurance, a governance and conflict-management consultant, a proper induction for new trustees can spare them any nasty shocks or reduce the feelings of pressure later on.
"I think that, with the medium-to-large charities, the level of commitment is being spelled out to people," she says. "But with the small community organisations, I don’t think it necessarily is – so people go into it in blissful
ignorance and not realising the scale of the responsibility."
Just over half (53 per cent) of respondents to the survey said they underwent an induction on joining the board, and 8 per cent said they were given an annual refresher.
There is definitely an appetite for more training: 82 per cent of respondents said better trustee training would be useful and 75 per cent said the same of training for chairs and honorary officers.
The study found that it had become difficult for many charities to recruit and retain trustees, with 43 per cent of respondents who were involved in trustee recruitment saying this had become harder or much harder in the past two years.
However, Ian Joseph, chief executive of the trustee recruitment body Trustees Unlimited, says he has not noticed a change. "We’re overwhelmed with demand from good people in the private sector who want to join charity boards, and few of them are really put off by the Kids Company debacle," he says.
Paul Streets, chief executive of the Lloyds Bank Foundation, which provides grants to small and medium-sized charities, believes that concerns about larger organisations such as Kids Company and the complaints about fundraising have affected small charities disproportionately and had an effect on trustee recruitment.
"It has created a noise around charities that is focused on risk," he says. "It discourages the people we should be encouraging to come forward as trustees. There’s no glamour in being a small charity trustee anyway, so we shouldn’t make it even harder."
Of the trustees who responded to our survey, more than half (56 per cent) were aged over 55 and 78 per cent were over 45; only 8 per cent were younger than 35.
Bubb says the recent negative coverage of trustees will not help to address the perennial problem of recruiting people under the age of 55 to the board. "If you’re going to say to a young profes-sional ‘join us, but you won’t get paid, you need to spend time and, by the way, there are all these duties and responsibilities and if you muck it up you’re going to get into trouble’, it’s not surprising they’re a bit wary," he says.
The issue of paying board members tends to hover over any conversation
about recruiting and retaining trustees, but the idea was largely rejected by our survey respondents, with 53 per cent saying it would not be useful to pay trustees and 17 per cent saying it would be neither useful nor not useful.
Rosamund McCarthy, a partner at the law firm Bates Wells Braithwaite, says payment would create potential conflicts of interest and lead to further complications on issues such as who decides how much trustees will be paid.
Streets points out that payment would simply create even more problems for smaller charities because they would not be able to compete financially.
Bubb, on the other hand, calls for a "more liberal" approach to payment. "We tend to see things in binary terms in the sector – either you pay all trustees or you pay none of them, but I’ve never seen it like that," he says.
"Some charities, particularly of a certain size, will want to pay trustees. They should be able to do that and justify it to their supporters. Some won’t want
to. It all has to be down to that particular charity."
McCarthy says another solution might be to emulate the private sector by
creating unitary boards that include members of the senior management team and trustees.
"If trusteeship is going to be much more accountable, it seems really odd that the chief executive, the chief operating officer and the finance director aren’t
on the board, because they are the ones with the day-to-day knowledge," says McCarthy.
Almost two-thirds (61 per cent) of respondents said they thought a national body for trustees would be useful.
McCarthy believes an organisation similar to the Institute of Directors, which would train and help to inform trustees, would be a useful addition. "When a charity is under attack, it sounds like an excuse to say ‘we’re only volunteers’, but it is true," she says. "There’s a bit of a gap for an organisation that could also defend trustees."
So has the situation for trustees reached a tipping point beyond which fewer people will be prepared to take up the role? Streets is concerned: "If you look at the broader economy, companies are looking to downsize, with fewer people doing the same amount of work, so people will become time-poor."
But McCarthy is more positive: "Being a trustee is incredibly rewarding. You receive just as much, if not more, than you give and the feeling of community and reciprocity is hard to beat.
"Yes, life is getting tougher for trustees but let’s not forget what it’s all about. If we work together we can keep what is precious about trusteeship."
THE TRUSTEE VIEW
Tristia Clarke (right) is the managing director of the telecommunications company Talk Talk and has been a trustee of Comic Relief for six years. During that time, she has seen the trustee’s role in protecting the charity’s reputation become increasingly important.
"I think if you’re a trustee of a large charity you know from the outset your
responsibilities and duties are going to be significant," she says. "But I see our role now being as much to protect and advise on the reputational side as to offer monitoring of financials. Trust, and making sure it is protected, is the most important thing."
Clarke says she spends at least half a day a month on the charity, which had an income of nearly £106.2m in the year to 31 May 2016, but typically it will be much more because she chairs the charity’s commercial technology board on top of her trustee duties.
"It’s an obvious point, but the one thing I have really learned is that if you’re going to be a trustee of something like this, you have to commit the time," she says. "Real time and thinking time. It’s not that easy."
Trustees have to be prepared for scrutiny after the media coverage of the past few years, she adds.
"You have to be very, very aware in this new world, where everything is and should be transparent, that consumers and supporters of charities increasingly have a degree of cynicism," says Clarke.
"In some ways I think you are always aware that if it does go bust you could be liable – it’s a significant role and it’s one that you have to take seriously."
THE TRUSTEE VIEW
Women's Resource Centre
Rupa Sarkar (right) became chair of the centre, a women’s charities umbrella group, in April 2105. She had been involved with the charity for about 10 years before becoming chair, but had never served on its board.
She says she was reasonably well prepared, but she can see how new trustees might not be. "There’s this slightly floaty, sugar-and-sweetness aspect to the way trusteeship is viewed," she says.
"But there is an occasional miserable aspect to it that you have to get through – if there isn’t, you’re probably doing it wrong."
Sarkar works as a freelance equality and diversity trainer, but spends anything from half a day to two days a week on WRC matters.
Her biggest concern is finding sources of funding that won’t leave the charity restricted by any anti-lobbying clause. "Sometimes I think it would be more useful to move to a US style of board, where your primary function is to bring resources in, although that would be quite a significant shift," she says.
The recruitment of trustees has been challenging in recent years, she says, especially because the board is often called on to perform key tasks such as supporting the staff team with fundraising: the charity’s income has fallen from £1.25m in 2011 to £725,000 in 2015, largely as a result of cuts in statutory funding.
The collapse of Kids Company and recent charity scandals have placed increased emphasis on trustees to ensure they’re on top of matters, but Sarkar does not believe it has fundamentally changed the environment for trustees.
"You get all these organisations offering seminars about how to cope in the new world, but I’m not sure there necessarily is a new world – there’s just more anxiety about it," she says.
THE TRUSTEE VIEW
Hanwell Bunnies Pre-school Playgroup
Nic Hough (right) has been chair of Hanwell Bunnies, a pre-school playgroup in west London, since 2013.
Her three children all attended the group and she originally got involved in its running by becoming a member of the parent committee. She had never been a trustee before becoming chair.
"It was quite daunting," she says. "I went into it thinking it would be just a few cake sales, but then you get a big legal document about your role as a trustee and how you are legally responsible."
Fortunately, she says, she was well supported by the charity, but still found it hard to get her head round parts of the Charity Commission’s document The Essential Trustee.
The biggest challenge for the charity, which has an income of about £72,600 a year, has been funding: the charity is facing a £14,000 shortfall in the coming year, so Hough thinks she’ll need to triple the half day a week she usually spends on the charity.
Hough says: "I was meant to be focusing on updating my qualifications this year so that I can go back to work now my youngest child has started school, but the time commitment to the charity is going to make that difficult.
"If I’d known what being chair was going to be like, I wouldn’t have put my hand up to volunteer at the meeting – I’d have thought about it for a few days. I think I’d have done it anyway, though.
"It is a lot more work than I thought it was going to be, but I’ve made the commitment now and I can’t leave when the ship’s in danger of sinking."
The full results of the National Trustee Survey will be published by nfpSynergy during Trustee Week (7-13 November).