The report is based on analysis of the data that the Charity Commission holds on trustees and the results of a survey asking trustees about their perceptions.The findings highlights some significant shortfalls in charity governance but also point to solutions that are, for once, very obvious and actionable – at least at the level of individual boards.
Diversity is a big problem
Boards are typically ‘pale, male and stale': 92 percent white, two thirds are male and the average age is 55 – 64. Three quarters earn above the national median income.
There are some significant skills gaps
The lack of demographic diversity is reflected in terms of skills and professional experience. Boards have insufficient skills in key functional areas such as marketing and digital.
There are fewer trustees than we thought
Previous estimates by the charity commission suggested that there are 850,000 trustees. In fact there are only 700,000. Many of these trustees serve on more than one board, and the average is 1.35 board positions per trustee
Most trustees are recruited informally
Over 70% of trustees are recruited through informal channels. This is really problematic, given the narrow background from which trustees are drawn, the fact that so many trustees are recruiting fellow board members from their own networks just perpetuates the lack of diversity and expertise on boards.
Why this matters
Being a trustee is a voluntary position, so perhaps we should just be grateful that anyone is putting their hand up for the job? But good governance is too important to leave it at this.
Boards hold the executive team to account, and offer it much needed support; they ensure that the beneficiaries needs are prioritised, that the charity is run sustainably and that it remains true to its purpose. A good board is key to any thriving charity, and conversely, a poor board can bring a good charity down.
When trustees share similar backgrounds
Boards will only make good well rounded decisions if the trustees have a range of skills, experience and perspectives. What happens when trustees share very similar backgrounds?
- Lack of legitimacy. Charities work with marginalised communities who are often excluded from positions of power. If the boards of these very same charities do not include trustees from their communities, what legitimacy can they have?
- Groupthink. It is well documented that diverse groups make better decisions. If everyone shares the same perspective they will also share the same blind spot.
- Lack of leadership. The world is changing fast, and charities need leaders with the right skills and expertise to help them seize opportunities and navigate difficulties. Digital is a good example of this. It emerges from the research as one of the functional skills most lacking at board level. The Charity Digital skills report found that over 70% charities say that their boards have low digital skills, and that this constrains the charity’s ability to develop.
It's not all bad news
Trustees enjoy their role
Ninety per cent of trustees say that they find their role rewarding and 94% say that the role is important to them. Being a trustee brings personal and professional benefits so it should be possible to attract a wider group of people.
Open recruitment is effective
Our experience at Reach Volunteering is that if you recruit purposefully, and invest time and effort, even smaller charities can attract good trustees who will expand the range of skills, experience and diversity of their board.
And once recruited, these trustees will have a very positive impact. 87 per cent of charities who recruited through our service say that the new trustee strengthened their governance, and 95 per cent say that the new trustee increased the diversity of skills and expertise on the board.
So why do so few boards recruit openly?
The survey does not ask this question. We find that it is often down to culture (the board has always recruited informally), confidence, or lack of time. Whilst lack of time may be a real constraint, it is not a good reason. The board chooses how it prioritises its time, and ensuring that they have the right team to carry out their role effectively is surely one of the most important things that they can do. And doing it well is likely to save time in the end.
So what next?
There is not a one-size-fits-all solution. As the research shows, issues vary with size. Eighty per cent of charities have no staff at all, and the trustees do the (operational) work as well as the governance. Being a trustee for Oxfam is very different from being a ‘hands-on’ trustee of a local scout group or village hall and recruitment methods (and target audiences) will be different for both. This is one of the reasons I am unconvinced by some of the report’s recommendations – for example a national register of trustee vacancies.
However, a more joined up approach by those who support charities to recruit trustees could certainly pay dividends. Reach is part of a working group exploring how we can develop a more a collaborative approach to encourage and support more charities to take an open approach to recruiting trustees. This is not just possible, it is essential: charities need boards with a breadth of skills and experience, to earn legitimacy and to provide good leadership.
Reach Volunteering was a member of the research advisory group for this survey. Reach runs a trustee recruitment service that is free of charge to all charities with a turnover of under £1 million. Last year we placed 450 trustees.
Our programme Building boards for a digital age is a useful starting point to help boards recruit trustees with digital expertise.