If paying trustees is the answer, what is the question?
Perhaps it is time for a commission on governance to look at what we want and whether we are getting it
By Penny Wilson
Every so often, the argument that we should pay trustees rears its head.
Trustee payment is proposed for lots of reasons: it's necessary because trusteeship is too burdensome, trustees aren’t taking their duties seriously enough, it’s too difficult to recruit, governance functions are too weak, there's a lack of diversity, and many other issues.
Arguably, none of these is the root cause either. If we go right back to basics, the question is whether trusteeship, and charity governance in general, is doing what it’s supposed to: help produce stronger charities and generate public benefit.
There is a feeling in some parts that governance in the sector could be stronger.
It’s this that leads to the debate about trustee payment. There's a feeling that Something Must Be Done and paying trustees is an easy change to make.
But it probably isn’t the whole answer, not least because so many people seem to hate the idea given that it runs contrary to our idea of how a voluntary sector ought to function.
Perhaps it is time to review what we want from governance, and if we’re getting it.
A lot of work has been done on what a trustee board is for. Julia Unwin’s five modes of governance outline the purposes of trustees, and the excellent Charity Governance Code gives a lot of detail about the behaviours that help deliver those functions.
In general, we want boards to do three things: help set a strategy and direction, provide support to executives where charities have them, and properly scrutinise to ensure we're delivering maximum benefit and taking proper care of the charity's resources.
Another very important consideration, though, is the ways in which a board can make a charity go wrong: by getting too involved, or not involved enough, or making the wrong decisions, or no decisions.
It's very hard to actually assess the quality of governance in a systematic way, so it’s hard to work out if charities are getting these things consistently. If people feel we aren’t, why is this?
One reason, perhaps, is that we just haven’t taken governance seriously enough as a sector. Perhaps we haven’t committed enough resource, or expended time and effort on trustee recruitment, or offered enough training or support. (We could say the same about HR, IT and finance.)
Another reason is that there’s some disconnect between what the law says about trustees and what charities actually want. Trustees are accepting more responsibility and risk – in fundraising and safeguarding, for example – but is their doing so of benefit to charities?
And those responsibilities and risks remain broadly the same at charities of all sizes, even though the actual needs are wholly different.
Boards of big charities, in particular, are struggling to do what is asked of them by law. It creates a risk-averse position. Perhaps one reason we aren’t getting what we want is that it’s not what the law says we have to have.
Although one response to this has been to suggest professionalising (in other words, paying) the board, that doesn’t seem popular, and paying trustees is not an option for the vast majority of charities because they simply don’t have the financial resources to do so.
In any case, it's very open to question if they could do it any better if they were full-time professionals. If anything, it would create a cosier relationship between the trustees and the executive, and trustees can already sometimes find it difficult to hold the executive to account.
This leads on to a broader issue of representation and scrutiny. Does the charity governance model currently give enough space and scope to the communities that charities serve?
Probably not. Too many boards are a sea of bald white heads. There is a lot of talk about improving diversity, but not enough action.
And it's not just about diversity. It’s also about inclusion, wider accountability, hearing from all the voices that need to be heard. And it’s about power.
One of the flaws in the charity governance model is that trustees are both under and over-powered.
On the one hand, they sometimes struggle to exert much direct control within a charity. On the other, they aren’t really answerable to anyone except the courts and the Charity Commission.
Neither beneficiaries nor the public have much scope to hold them – and, by extension, the charity – to account.
It’s not clear that many of these issues have easy or simple solutions. The truth is that good governance is extremely hard. No one has really cracked how to do it consistently, in the public, private or voluntary sectors.
Paying trustees certainly won’t address all of this, and possibly not any of it. A review of the legal requirements on trustees would be welcome, but is unlikely.
Much greater investment in support and training would help, as would a professional approach to recruitment, with much more emphasis on diversity. And an excellent place to start is by recruiting your trustees openly, rather than by persuading friends and acquaintances to take on the role.
The charity sector has a strong record of self-inquiry on existential issues: form a committee of experts, consult widely and bring back some solutions.
Perhaps the time has come for a commission on governance.
This article originally appeared in Third Sector: https://www.thirdsector.co.uk/