Five questions charity trustees should be asking

Becoming a charity trustee is an opportunity to support a cause that matters to you, but it also comes with significant responsibilities.

Trustees are responsible for the overall governance and strategic direction of their charity. That means looking beyond the immediate operational issues on the agenda and asking whether the organisation is fulfilling its purpose, managing its risks and making decisions that protect its future.

So, what should Trustees be asking around the Board table?

We put that question to five Blake Morgan colleagues who serve as charity trustees outside their day jobs. Their answers highlight five areas every charity Board should keep under review.

1. Are we still delivering our charitable purpose?

It is perhaps the simplest question a trustee can ask, but also one of the most important.

Natalie Lawley, who is a Trustee, Non-Executive Director and Vice Chair of the Board at Theatr Iolo, puts charitable purpose at the top of her list:

“Good Trustees ask: Are we delivering our purpose, managing our risks and protecting the charity’s future?”

It can be easy for a Board’s attention to be dominated by finances, staffing, funding applications, regulatory requirements and immediate operational challenges. All of those things matter, but in dealing with those issues, Trustees must always retain their focus on why the charity exists in the first place.

That means understanding the charity’s purposes and ensuring its activities further them. When considering a new project, partnership, investment or significant expenditure, trustees must consider whether this furthers the charity’s objectives.

If you’re not sure what your charity’s objects are, these can be found in the charity’s constitution, and also in the “Governing Document” section of the charity’s page on the Charity Register.

Dan Taylor, a Trustee and leader of his local church, makes a related point. For him, Boards sometimes need to step back from day-to-day decision-making:

“I think at times it can be easy to get bogged down in the nitty gritty decisions and day-to-day running of a charity. I would always look to prompt the board and the trustees to take a step back and make sure that we are listening and responding to the people and communities that we serve.”

A useful question for trustees is therefore not simply “Can we do this?”, but “Why are we doing this, who will benefit and how does it advance our charitable purposes?”

2. What is stopping us from achieving what we want to achieve?

Good governance is not simply about identifying everything that could go wrong; it is also about enabling the charity to succeed.

Katie Edwards, a trustee of North Wales music organisation NEW Sinfonia, suggests asking:

“What is stopping you from achieving what you want to achieve and how can we help?”

It is an important distinction. A Board that focuses solely on risk can unintentionally become an obstacle to progress. Effective trustees should instead consider both the opportunities available to the charity and the obstacles preventing it from achieving greater impact.

Those obstacles might include financial pressures, difficulty recruiting staff or volunteers, property requirements, a lack of particular skills on the Board, technology or simply organisational capacity.

Trustees should understand those constraints and decide what they can appropriately do about them.

3. What went wrong, and what can we learn from it?

Successful Boards should be interested in problems as well as successes.

Lee Fisher, a Trustee of contemporary circus company NoFit State, believes boards should be willing to ask a particularly direct question:

“What went wrong? Never be afraid to challenge existing practices and build on them. Even the most successful projects encounter problems and mistakes along the way.”

That does not mean allocating blame whenever something falls short of expectations. Instead, Boards should foster a culture in which problems can be discussed openly and used to improve future decision-making.

Trustees need enough information to identify significant risks and satisfy themselves that appropriate systems are in place to manage them.

When something does go wrong, useful questions might include:

Did the Board have the information it needed at the right time?
Were policies and controls followed in practice?
Does the issue need to be reported or escalated?
Is this an isolated problem or evidence of a wider issue?

Minutes are important here too. Significant decisions should be properly recorded, including appropriate details of the factors the Trustees considered and how they reached their decision.

The objective should not be a Board that never encounters problems. No organisation can guarantee that. It should be a Board that can identify, respond to and learn from them.

4. Are we making decisions today that will protect the charity tomorrow?

Trustees inevitably have to deal with immediate pressures. But one of the Board’s most important roles is to take the longer view.

As Natalie puts it, trustees should ask:

“Are we making decisions today that will ensure the organisation remains sustainable and impactful in the future?”

Financial sustainability will be a central part of that conversation, but resilience goes beyond the balance sheet.

Boards should consider whether the charity is overly dependent on a particular source of income, individual, contract or funder. They should think about succession planning, organisational skills and knowledge, property requirements, technology and the external risks that could affect future delivery.

Trustees must be willing to test the assumptions behind strategic plans and financial forecasts, asking not only what is expected to happen, but what the organisation would do if circumstances changed.

The objective here is not to eliminate risk, but to make properly informed decisions about the level of risk the charity is prepared to take in pursuit of its purposes.

5. Does our Board have the people and skills it will need next?

A Board should also be prepared to turn the scrutiny on itself.

Rachel Sales, a Trustee of Cowley Child Contact Centre in Oxford, believes Trustees should ask:

“What are the Board’s plans to support diversity and inclusion in the coming years, and how will they help Trustees to develop new skills, for example responding to the opportunities and threats posed by AI?”

A Board may have served a charity extremely well for many years, while still needing different experience for the challenges ahead. Trustees should regularly consider whether their Board collectively has an appropriate mix of skills, perspectives and experience.

That may mean examining recruitment and succession planning, identifying gaps through a skills audit, providing appropriate Trustee training, and/or looking at whether the Board reflects and understands the communities the charity serves.

New technology is a good example of why Trustee development should be ongoing. Boards do not necessarily need every Trustee to become a technical expert, but they must have sufficient understanding to ask appropriate questions about emerging risks and opportunities.

Good governance starts with good questions

There is no single question that can tell Trustees whether their charity is well governed.

Instead, effective trustees continually look at the organisation from different perspectives: Are we fulfilling our purpose? What is holding us back? What can we learn when things go wrong? Are we sustainable? And does this Board have the skills and perspectives it needs for what comes next?

Asking those questions is only the beginning. Trustees must also be prepared to challenge constructively, listen to the answers and act when an issue needs addressing.

That is particularly important for anyone considering becoming a trustee for the first time. Before accepting an appointment, prospective Trustees should carry out appropriate due diligence to understand the organisation they will be helping to govern.

This should include reviewing the charity’s governing document, recent accounts and financial position, strategy, significant risks and liabilities, Board structure and the expectations placed on individual Trustees. Prospective Trustees should also understand how decisions are made, what induction and training will be available and, crucially, whether they have the time and commitment the role requires.

Trusteeship can be hugely rewarding, especially when it is done well. Charity trustees take on responsibility for governing an organisation established to deliver public benefit; understanding that responsibility, and being willing to ask challenging questions, is fundamental to performing the role well.

Blake Morgan’s Charities team advises charities and their Trustees on governance, constitutional and regulatory matters, including Trustee duties, governance reviews and managing legal and regulatory risk. If your Board requires advice on its responsibilities or governance arrangements, please get in touch with a member of the team.