Charities newsletter – July 2018

Our Charities team here at Blake Morgan publishes e-bulletins to keep you up-to-date with breaking news and topical issues affecting the sector. We also offer regular charity trustee induction and refresher training sessions.

Reminder: Charity automatic disqualification rules: prepare for changes to the law

From 1 August 2018 the Charity Commission’s rules on automatic disqualification of trustees will change to include a wider scope of positions for automatic disqualification and extend to people holding senior manager positions in charities (this would include chief executive officers, finance directors and people in similar roles).

It would be advisable for trustees and management within charities to take this time before the rule change takes effect to review the Charity Commission’s guidance to familiarise themselves with the changes. It would also be prudent to ask trustees and individuals holding senior management positions to confirm that they do not fall within any of the categories which would render them to be automatically disqualified from 1 August 2018. If any individuals do fall within the categories you should consider whether it is appropriate to apply to the Charity Commission for a waiver.

The Charity Commission’s guidance, which includes template declarations, can be viewed here.

Prepare for the Annual Return 2018

Following the Charity Commission’s consultation with the charity sector last year, the annual return for 2018 has been updated and will be available for completion from next month. The updated annual return will include new questions, some of which will be optional, and the Charity Commission has published details of some of the new questions now so that charities are able to view these in preparation. The changes include more questions regarding salaries being paid by the charity with a view to assisting greater transparency between charities and the general public.

The Commission’s summary of the changes can be viewed here.

Charity Commission: making it easier to update your charity details

In the wake of the GDPR and the Data Protection Act 2018 coming into force, the Charity Commission has changed some of their processes to make it easier for charities to update their details.

The Charity Commission have asked charities to take this opportunity to check that their information is up to date and accurate; this involves adding the details of new trustees as well removing the details of former trustees.

The Commission are asking for all active trustees to supply their email address or to confirm that they do not have one. This is so they can communicate any changes to a charity’s details to the relevant personnel as quickly as possible.

New draft code of ethics published by NCVO

The National Council for Voluntary Organisations (NCVO) has published a draft code of ethics that centres on beneficiaries needing to be put first by charities and the need for charities to be open and transparent.

The draft code has been developed by drawing on existing codes of conduct and ethical principles, and discussed with key representatives and has come in the wake of increased speculation on charities and safeguarding issues.

The draft code is split into four main sections: Putting Beneficiaries First; Acting With Integrity; Being Open; and Ensuring the Right to be Safe.

A copy of the draft can be viewed here and the consultation on the draft closes on Wednesday 26 September 2018.

New Statement of fundraising ethics agreed

A statement of fundraising ethics has been agreed at the International Fundraising Summit on 5 July 2018 which was hosted by the Institute of Fundraising. The summit was attended by professional associations and fundraising bodies from around the world.

The statement sets out a series of principles that ought to govern fundraising work. These principles include: honesty, respect, integrity, transparency and responsibility.

The statement also sets out standards of fundraising practice for international fundraisers. These standards include: responsibility to fully comply with relevant legislation and regulatory standards; responsibility to supporters; responsibility to their cause and beneficiaries and a number of rules around management, costs and finance reporting as well as proper pay and compensation.

Trust in Charities 2018

The Charity Commission has published its report ‘Trust in Charities 2018’ which has been prepared following the independent research undertaken into public trust and confidence in charities in 2018.

The key findings in the report include:

• “The factors of trustworthiness: the public want charities to demonstrate good stewardship of funds, to live their values, and to demonstrate impact”. The research undertaken suggests that trust and tendency to donate increases where charities can show that most of their donations directly reach the end cause and demonstrate positive results.
• “Trust matters to donation behaviour“. In addition, many whose trust in charities has declined say they are donating less as a result.
• Overall trust and confidence in charities remains at similar levels to 2016 (when the last research was carried out).
• The charity sector does hold up well compared to other sectors (e.g. private companies, banks, politicians), however it is less trusted that the average man or woman in the street.
• The Charity Commission is recognised for its important role by the majority of the public.
• The sector is still recognised by the public as playing an important role in society, and they want to see evidence of the positive effect and impact.

The full report can be viewed here.

Recent case: Do Members Owe Fiduciary Duties to Charitable Companies?

Following the most recent ruling in a case concerning the Children’s Investment Fund Foundation (CIFF), it now appears that members of some charitable companies owe fiduciary duties to those charities. We explore the significance of the CIFF ruling here.

Recent ICO fine: what can we learn?

Following a cyber-attack on the British and Foreign Bible Society which led to a data breach by the charity in 2016, the Information Commissioner’s Office (ICO) has recently fined the Society £100,000 for failing to take “appropriate technical and organisational steps” to protect its supporters’ personal data.

Charity Trustee Training Seminar

We are holding a seminar in our Southampton office on Tuesday 25 September.