Charity risk barometer 2023
The charity sector faces many challenges, the financial crisis being a key factor, but it does so from a position of strength and resilience.
Charities admit they struggle to hire trustees, we want to promote the benefits of taking up such a challenging yet rewarding role.
The role of a charity trustee has many perks but it’s worth understanding how these can vary depending on the size and nature of the organisation. You might wonder:
But it’s hard to say because being a charity trustee, your responsibilities are likely to vary for a community group compared with a large charity or a social enterprise. It’s therefore important to do your research and really understand the scope of the role firstly, so you don’t overcommit and secondly, so you achieve what you would like in the process.
There are, however, some benefits as well as some of the risks that might help sway your decision.
You may not get paid for your service as a trustee but what other benefits can be garnered from volunteering as a trustee?
It’s also important to understand the challenges you might face. So what could happen?
Being a trustee means you’re responsible for making sure the charity is run properly and uses its charitable funds and assets wisely. Also for making sure that it doesn’t do anything to put its property, funds, assets or reputation at risk, and takes care when investing or borrowing money.
And of course, ultimately, for making sure it delivers on its charitable objectives.
In simple terms the risks associated with being a trustee really begin to arise when as a board member, you don’t meet some or all of those duties and responsibilities.
It could be anything from a breach of authority on the Board’s Trustee’s part; or an omission by the Board Trustee; even neglect; or maybe a misleading – perhaps libellous or slanderous – statement issued by the Board of Trustees. If someone feels they have suffered a loss– whether financial or otherwise, the liability can lie with the board.
In this case, it’s worth speaking to the charity before you join as trustee to see if they have trustees’ liability insurance. Having this cover in place helps to give you confidence when making decisions on the charity’s behalf. Please note- this won’t cover you for every scenario but if you have acted lawfully and made and honest mistake, then you should be protected.