New charity trustees may be about to enjoy a stimulating new involvement or find themselves walking into a minefield!  To make sure yours feels more like the former:

1) Avoid walking unawares into personal financial liability

An important first step is to find out the legal structure of the charity.  Whilst there are currently over 165,000 registered charities in England and Wales there are only four main types of charity, see info here.

Of these, the Charitable Incorporated Organisation (“CIO”) and the Charitable Company Limited by Guarantee are corporate structures where generally  trustees are not personally liable for what happens. But even here, if things go wrong, trustees may soon face the risk of being named and shamed by the Charity Commission with an Official Warning.

As well as Official Warnings,  trustees of Unincorporated Charitable Associations and Charitable Trusts can also be personally financially liable for what they and their charity does.

Some of these liabilities can be covered by insurance but you cannot insure against liability to the charity’s creditors should the charity run out of money while you are a trustee.

It is sometimes possible to bring the risk of trustees’ personal liability to an end by incorporating the charity but this is far from straight forward.

2) Request an induction pack and weigh the response as a measure of the charity’s maturity, governance level and viability

Ideally new charity trustees should receive:

• a copy of the Governing Document or Constitution
• the latest Annual Report and Accounts
• the current budget and management accounts
• the Strategic Plan
• the names, home addresses and contact details of all your fellow trustees
• minutes of at least the last three trustee meetings

If any of these are missing or you get blank looks when you ask for them, take a view.  Not every charity’s organisation is completely up to scratch.  Happily many shortcomings can be made good.

So don’t turn your back on what might be a fulfilling relationship – but be cautious.

3) Do your research

Make a search of the Register of Charities, where you can find the charity’s financial and compliance histories and where there should be summaries of its finances for the past four years and further information that will interest you.

You can also see whether the charity is keeping up to date with the documents it is legally required to file.

If in doubt, keep away; otherwise go ahead but with your eyes wide open.

4) Be prepared for collective responsibility and the duty of confidentiality

Trustees often have to take decisions on very difficult issues and they have a duty to act collectively.

Genuine and strongly held differences of view can arise. Trustees can act by majority unless their constitution says otherwise.  So, once an issue has been thoroughly debated decisions should be taken and the majority view should prevail.

If you find yourself in a minority you have to decide whether or not you can bring yourself wholeheartedly to support the decision. If not and it is a major issue for you, you would have to accept that your position was untenable and resign with good grace. You and the charity then each move on but with a parting of the ways.

The best trustee boards are those which have robust debate but stand united in their decisions.  When trustees express division outside their meetings, beneficiaries funders and staff can all lose confidence.

Confidentiality matters because charities have to earn and keep the trust and respect of the organisation’s stakeholders. That can ebb away when the trustees are seen to be divided or when trustees criticise each other.

Remember the charity’s name and reputation are valuable and trustees must make sure that they avoid any activity that might damage their charity’s reputation.

5) Trusteeship is a privilege and a burden, so be ready for both

The upside is the opportunity to make a real difference, to make your mark, to support a cause you truly believe in; to meet like-minded people and to bring your own talents to bear in making our society better; and to enjoy.

The down-side depends on you – we all have different tolerances. Expect meetings that last longer than you would choose, more papers than you would care to read and some frustrations you could well be without.

But for me, and for most charity trustees, the plusses will easily outweigh the minuses.

Next steps

A great starting point for new charity trustees is to have a good read of the Charity Commission booklet The Essential Trustee.

And finally, assess your prospects by taking Good Trustee / Bad Trustee – The Quiz!

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Geoffrey Hand

Geoffrey Hand is a charity governance consultant, offering governance consultancy and training. He also provides legal services management, helping charities get better value for money from their lawyers. Geoffrey has extensive experience in the charity and legal worlds, and his mission is to help charities deliver good governance.

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