An independent governance review of Citizens Advice Scotland has revealed "dysfunctional" and "unprofessional" dynamics among trustees and called for radical changes to the board’s structure.
The report by accountancy firm Deloitte, published today, made 32 recommendations for improving the charity’s board, which it says was "not fit-for-purpose" and "failing its members, CAS staff and funders".
In statement, the charity, the umbrella organisation for the Citizens Advice bureaux in Scotland, said it had accepted all of the recommendations and produced a timetable for implementing them.
The Department for Business, Innovation and Skills reportedly ordered the charity to carry out the review in March, withholding half the annual funding it provides to CAS to ensure the charity complied.
The review was ordered just weeks after the charity dismissed its chief executive Margaret Lynch following an investigation. The charity’s chair Dominic Notarangelo stood down in June after six and a half years as chair, having been warned the Deloitte review would contain direct criticisms of his leadership of the board.
Today’s review says stakeholders had described Notarangelo as lacking the leadership qualities to chair an organisation of CAS’s scale and complexity, and did not perform a number of the expected duties.
It recommends a new, independent chair be appointed with the skills and capability for a charity the size of CAS.
The report says the organisation had grown and taken on new responsibilities and functions in recent years, but the board composition had not evolved alongside those changes and lacked the skills, experience and capabilities to provide effective oversight and stewardship.
"The CAS board has exhibited dysfunctional dynamics and inappropriate behaviours driven by cliques and personal interests," it says.
"Individuals used terms such as ‘tension’ and ‘unprofessional’ when referring to board behaviours and dynamics, with meetings described as ‘getting out of hand’."
It expresses concern that the majority of the board was made up of trustees who were either paid or unpaid staff from individual bureaux, limiting the range of skills and perspectives among board members and creating an impression trustees were more focussed on the interests of bureaux than beneficiaries.
The report calls for a new board of between 11 and 13 members to be elected in 2017, with a balance of external trustees and bureau trustees, with no trustee allowed to stand for re-election after six years in post.
It also recommends the creation of a competitive appointments process to ensure trustees are chosen on merit, skills and experience, a more detailed induction for new trustees and of a mechanism to allow trustees to remove underperforming board members.
In a statement, Agnes Robson, interim chair of the charity, said: "The CAS board has noted the report and unanimously agreed the recommendations. Over the next few months we will consult with our members to understand their views, ahead of seeking their formal approval.
"This review is about ensuring the structure of governance arrangements at CAS reflect current best practice in the sector."
She said: "The recommendations involve significant change. However, I am in no doubt that this is the right way forward, and the board has agreed the recommendations in full."
The charity also laid out a timetable for implementing the recommendations, and said it had convened a general meeting in November so members could vote on changes to the charity’s articles required to implement the recommendations.
It also set a deadline for the new chair and board to be in place by March 2017.