The new Charity Governance Code published on 13 July 2017 replaces the Code of Good Governance and has gained support of the Charity Commission, which recently withdrew its own guidance Hallmarks of an Effective Charity.

The aim of the code is “to help charities and their trustees develop these high standards of governance”. Although not a legal or regulatory requirement, the code sets out principles and recommended practice for Charities and trustees who wish not only to achieve good governance but strategies to continuously improve and develop.

Good governance is ensuring that your charity has adequate policies, systems and procedures in place and that these are followed. It is also about encouraging appropriate attitudes, behaviours and values.

The code has been designed in two versions, one for larger charities (typically with income in excess of £1m) and the other for smaller ones. You can view a full copy here.

Seven Principles

The code is divided into seven core principles covering aspects such as organisation purpose, board effectiveness and openness and accountability.

From each of the seven principles, the code gives examples of recommended practice, which the charity should consider during their review.

The code is designed to be regularly reviewed as your organisation grows and evolves.

Adopting the code

It is expected that Charities who chose to adopt the code will publish a brief statement in their annual report, explaining their use of the code. This is anticipated to be “a short narrative rather than a lengthy ‘audit’ of policies and procedures”.

The code has a policy of “Apply or explain” for charities to demonstrate their approach to applying the code. It acknowledges that not all aspects and recommendations will be appropriate for all charities and therefore can ‘explain’ what they have done or why they have not applied a particular aspect.

The code is more demanding and aspirational than previous versions, aiming to meet the demands of the changing public expectations of charities, their trustees and senior management.

If you have any questions please feel free to contact your local Bishop Fleming advisor.

 
 
 
 
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