Green lights ahead
It has been another testing year for the charity sector. Over the past 12 months funding uncertainty, regulatory investigations and historic acts of fraud have magnified existing challenges and brought new threats.
The scale of the challenge has been clearly identified by regulators. Research carried out for the Charity Commission showed the level of public trust and confidence in charities had fallen significantly since 2014. Media stories about charities and how they spend their money were cited as key reasons for the decline. Although many have shown resilience, dashboard warning lights are beginning to flash in several areas.
To regain public trust, charities must improve decision making and become more accountable for the way funds are raised and spent. Governance procedures must be reviewed and organisational risks reassessed. Audit, finance and risk committees have an important role to play. But with little central guidance, how can charities make sure their committees are fit for purpose and contribute to good governance?
Here we offer advice on how to run effective committees and reveal our survey findings on current practice across the sector. Some charities will set up separate committees to deal with audit, finance and risk. Others will create a combined committee for two or three of these areas. Our advice is applicable to all.
Throughout the report we have used our survey findings to benchmark current practice in a traffic light system; we hope it will help your charity tackle the pressing need to embed good governance, and help you to turn all lights green.