My client Cass Centre for Charity Effectiveness was delighted to be featured in the Sunday Times last week in an article entitled, ‘Charities Don’t Want Sympathy’ looking at the contribution needed by trustees and Non Executive Directors to Charity boards and the responsibilities involved.
Denise Fellows, director of consultancy and talent development at the Cass Centre for Charity Effectiveness pointed out that most UK charities are tiny: there are about 82,000 “micro” charities (income of less than £10,000), accounting for just over half the sector, compared with some 500 “major” charities whose turnovers exceed £10m.
“Often, on smaller boards, where you’ve got a local parent-teacher association or village hall, people often don’t realise they are a trustee,” said Fellows, “whereas everyone understands [their liabilities] when they’re sitting as a board director of a company.”
In fact, trustees of smaller non-profit organisations often have far less protection than their counterparts at household-name charities, which enjoy the benefits of being limited companies
“Only 25%-30% of charities are incorporated, which means they have less liability and trustees are less exposed,” said Fellows. “There are trustees who don’t realise that if they have a role at a charity that is not incorporated, they have more liability than if they were sitting on a private sector organisation board, where there’s limited liability.”