Any organisation needs good governance and structure to prevent dissolution.
Charities and not-for-profits, with their tight budgets and limited resources, are especially in need of judicious governance that prioritises the needs of the organisation.
While larger charities may employ staff to manage processes effectively, these matters can often be overlooked in smaller organisations.
Failure to deliver and document processes and structure effectively can also lead to legal challenges against Trustees and potential Trustees Liability claims under your Charity Insurance policy.
Seven Principles for Good Governance
Sensing this need for help and guidance, the Developing Governance Group in Northern Ireland developed a code consisting of seven fundamental principles of good governance for the voluntary and community sector.
Adhering to these seven principles can help your organisation manage risk and flourish under effective and stable governance:
Every organisation needs good leadership. Make sure yours is led by a committee which guarantees the delivery of its objectives, charts its strategic course, and reflect its values.
#2 Responsibilities and obligations
The members of your management committee are legally responsible for their decisions and should be collectively accountable for the welfare of your organisation.
By assuming responsibilities, your management committee should organise itself to effectively fulfil its obligations.
#4 Performing, reviewing and renewing
Periodically reviewing the organisation’s effectiveness is critical to ensure legal compliance and long-term survival.
An organisation will quickly crumble without clearly delineated responsibilities.
Your management board needs to assign responsibilities to anyone performing duties for your organisation and monitor their performance.
When running a charity, integrity is key to achieving its mission.
All management decisions should be made with integrity and in the best interests of the organisation.
Transparency is necessary to show nothing is being mismanaged.
Where Can I Find More Information?
The DIY Committee Guide website provides some useful resources which can assist implementation of these key principles, including Draft Agendas and Planning templates.
It may also be helpful to develop a suite of standard documents which can be utilised across the organisation to encourage continuity and best practice.
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