Trustees’ Week: Decision making for charity trustees

The Charity Commission recently refreshed its guidance on decision making for charity trustees to make it more accessible and easier to use. It’s a really useful piece of guidance issued by the Commission, which helps trustees think about the range of factors that they should take into account when making decisions, and it also provides practical advice on how these decisions should be properly documented. This will be really helpful for future trustees, who will be able to refer back to the reasoning behind certain decisions, or, if/when things go wrong, the trustees can point to their decision making process to provide context and explanation. 

Trustee decision making is a common feature of Charity Commission inquiries, so it is helpful for trustees to be familiar with this updated guidance.

The guidance confirms that, when making decisions for your charity, you and the other trustees must:

• act within your powers;

• act in good faith and only in the interests of the charity;

• make sure you are sufficiently informed;

• take account of all relevant factors;

• ignore any irrelevant factors;

• manage conflicts of interest;

• make decisions that are within the range of decisions that a reasonable trustee body could make.

This guidance explains these principles in more detail and how to follow them, particularly when making significant or strategic decisions. It emphasises the importance of following the charity’s governing document, which will set out how the charity must make decisions, including whether you can delegate certain decision making, for example, to staff, sub-committees or individual trustees. It also reminds trustees that all trustees are jointly responsible for decisions, even if you don’t attend the meeting, take part in a decision or vote for the decision. It explains how to approach a decision where trustees cannot agree. 

In very limited circumstances, when the matter is complex and/or high risk, you can apply to the Commission for formal advice on whether what you want to do is consistent with your powers and duties, for example, if you’re not sure that you have the power to carry out an unusual or large transaction. If you follow the Commission’s advice in good faith, you will be considered, in law, to have acted properly. 

It’s definitely worth a read or a re-read to refresh your knowledge and help ensure the decisions that the trustees make are robust and well-documented.