Do it Well
Good Governance Matters
We will never find any basis for charges against this man Daniel unless it has something to do with the law of his God.
Things need to be done well so that there is honour to the name of Christ publicly.
Governance is an awkward–sounding word: it does not trip easily off the tongue, and it even sounds a little threatening. It can feel that way too, especially when there are regular news items about something going wrong. But done well, governance can honour God, enable a ministry or church’s mission to be fulfilled and focus energy and resources on what really matters.
The word means different things in different contexts but for registered charities, whether organisations or churches, it is about the role of a board of trustees and what is expected of them. It is not exactly the same as leadership, though it does include some aspects of it, such as finding vision and developing the strategy necessary to carry it out. Neither is it exactly the same as management, though it also includes aspects of that, for example, appointing staff and overseeing finances. Nor is it about doing the day-to-day work of the charity. Most so-called Third Sector organisations have a different governance system to industry and businesses but while many corporations call their governing board a board of trustees, their role is different to that of charity trustees. Governance happens at all levels of society, from the small local organisation to the national. It’s the approach that is taken to managing the organisation and the methods used for doing it. For a church or Christian charity, governance is about putting in place the policies and procedures necessary for its ministry to flourish. These are decided when the charity is registered and form the major part of the governing document which is what the Charity Commission actually registers.
A basic responsibility of trustees is to make sure the resources are being utilised for the purpose for which the church [or charity] came into being, to ensure a context in which the resources and the energies of the church are brought together and that people work together.
Establishing a separate charity can enable something to be achieved which no one church could do on its own.
For me the common theme through all of these [charities I’ve been involved in setting up] has been about enabling the church to work together to serve the community – and to work together in a way which wouldn’t be possible or even desirable for any one church to do on its own. For example with YoYo’s [York Schools & Youth Trust] work in schools I think there’s a tremendous strength in the churches in York coming together to offer that resource to schools and it could never be the same thing if any one church set out to do it – I don’t think any one church could do it, and it wouldn’t be a desirable thing for one church to do it. Setting up something that’s extra to church structures inevitably means setting up some form of governance, which usually involves trustees.
This book focuses on the particular governance required for charities and specifically Christian charities. That includes the bodies in churches which make governance decisions, whether an Anglican PCC, a Church of Scotland eldership, or a nonconformist or independent church’s deacons or elders. The first four chapters, the section on godly tracks, considers why it is important that they carry out their duties well. But first, what are the advantages and disadvantages of being a registered charity?
What is a charity?
The Charities Act 2011 says that a ‘charity’ is an institution which:
- is established for charitable purposes only and
- is subject to the control of the High Court’s charity law jurisdiction.(vi)
Charities exist to benefit the public or a certain section of it, not to make profits for shareholders as business and industry do. The Charities Act 2011 lists thirteen charitable Objects, one of which is ‘The advancement of religion’. For churches that is taken as given, but other organisations, especially new ones, have to think about what sort of governance will suit them, including whether registering as a charity is the right course of action for them, and if so, what kind of charity they will apply to become. There are different kinds of charities, the most common of which are a Trust only, a Trust which is also a limited liability company registered with Companies House, and a Charitable Incorporated Organisation (CIO).(vii) There are pluses and minuses to each of them and there is guidance about this on the Charity Commission’s website, along with much other information which will help in the application process. An organisation considering registering would be wise to seek advice on what would suit them best.
A group applying to register as a charity has to demonstrate that its work or ministry will benefit the public in specific ways. The overall purpose for which a charity exists is termed its Object and what it proposes to do its Aims (so the phrase ‘Aims and Objects’ is often used). ‘Promoting the Christian faith’ is not a sufficient Object in itself: how will that be done, in what geographical location or for which group in society? In other words, who will actually benefit from it, and how? These are important questions to answer, as they help shape the vision and ministry, which we will look at in more detail later. I was most recently chair of YoYo. Some years before, YoYo’s Trust Deed had set out the charity’s Object:
To advance the Christian religion in schools and youth clubs and to promote any other charitable purpose for the benefit of young people in York and the surrounding areas.
As trustees we found it necessary to define what we meant by ‘surrounding areas’ and decided that it should include the villages surrounding York, where at least some of the children from the primary school moved up to one of York’s secondary schools. However, to start working regularly in, say, Leeds or Hull, would be outside our Object and therefore could not be considered unless we wanted to ask the Charity Commission’s permission, or change our Trust Deed (which would have to be approved by the Charity Commission).
Registering as a charity has become more demanding since the 2011 Act, but that can be a good thing:
The Charity Commission application and the new documentation for CIOs involve a lot more questions and the trustees have to have a clearer idea of what they’re doing. The charity application is so much more complicated than it used to be, so trustees of a new Trust now have to think through a lot more what the charity is about and what they have to do. That means the new Trusts are much better at understanding what’s involved.
If it is a complicated process, why bother? There are several advantages to being a registered charity. Perhaps the most valuable is that various tax reliefs apply to charities, the best known one being the recovery of income tax from HMRC on gifts made under the Give As You Earn and Gift Aid schemes. Grant-making Trusts and local and national government are often more open to approaches from charities than from non-charitable groups, so being a registered charity can make a significant difference to income and is therefore financially worthwhile as well as being good stewardship.
What governance involves
The first place to go for guidance about starting or running a charity is the Charity Commission.(viii) Their website holds many resources, which clearly spell out what charities must do – things that are a legal requirement – compared with those things charities should do, which are strongly advised and good practice. There is also a Charity Governance Code,(ix) which was created by people involved in charities and is acknowledged by the Charity Commission. Much of it is helpful in encouraging good practice and helping trustees to think through issues, but some sections have ambiguous wording which needs careful reading. It is worth looking at and can be very helpful, but it is important to remember that it is not legally binding.
The word ‘trustee’ was first recorded in about 1640 so it has been around for a long time. It is a legal term for someone in a position of trust, and in its widest sense refers to a person who holds property, authority or a position of trust or responsibility for the benefit of someone else. Registered charities are required by law to have trustees. For the purposes of this book, ‘trustee’ is the term used for people who serve on the board of trustees of an institution that operates as a charity and which therefore exists for the benefit of the general public rather than for the benefit of the individuals themselves or to make a profit for shareholders. They are usually elected, though may be appointed in some other way or become trustees by nature of the job or role they hold, an example being the minister of a church who is almost always automatically a trustee even though in the wider charity world the person employed to lead the organisation is not normally a trustee. The founding document (which can have a variety of names – see the definitions in Appendix 1) will set out how trustees are appointed and may include how long they can serve for and other related matters.
Trustees have certain duties, some of which are fiduciary, that is, the legal requirement that they act on behalf of and for the benefit of other people rather than themselves. It was Archbishop William Temple who said, ‘The Church is the only society that exists for the benefit of those who are not its members’,(x) so acting for the benefit of others should be part of the DNA of a church or Christian organisation. Nehemiah’s primary aim in rebuilding the walls of Jerusalem was the honour of God, but he didn’t benefit from it personally. When the wall was completed he returned to the service of King Artaxerxes, which meant that he did not live for any length of time within the city he had been instrumental in making secure. Working for the benefit of others is not only a legal (fiduciary) requirement, but should be almost second nature to Christians.
Integrity and Trustworthiness
There are other benefits to being a charity, particularly in public confidence and image, though sadly some of this has been damaged by high–profile cases in recent years. Nevertheless, people are still more likely to offer time, energy or money to a registered charity than to a non-charitable organisation doing similar work because they expect it to be honest and have integrity. That applies to churches also – the general public has expectations about what a church should and shouldn’t do: it can be high–profile local news if a vicar or church treasurer misappropriates funds, but not nearly so likely if the manager of a local shop does the same! As Christians, integrity should be one of the things that characterises all aspects of what we do, including how we run and manage our churches and organisations.
‘Integrity is doing the right thing even if no one is watching’(xi) is a statement often incorrectly accredited to C S Lewis, but whoever did say it caught the essence of integrity. Showing integrity in what we do and how we do it is a biblical characteristic. When Nehemiah had completed the building of the wall around Jerusalem, he appointed Hananiah as:
the commander of the citadel, because he was a man of integrity and feared God more than most people do.
King David recognised his personal need for integrity and asked God for it at one of the times when he was facing many enemies:
May integrity and uprightness protect me, because my hope, Lord, is in you.
A later psalmist, Asaph, recognised that God had answered that prayer of David’s:
David shepherded them with integrity of heart.
The book of Proverbs also acknowledges the importance of integrity:
Whoever walks in integrity walks securely.
The integrity of the upright guides them.
Righteousness guards the person of integrity.
The very word trustee implies that the role should be carried out in a trustworthy way. It was certainly what marked Daniel out and summed up his characteristics. When King Belshazzar saw the writing on the wall and was desperate to find someone who could interpret it, his mother suggested Daniel, with the most amazing commendation:
There is a man in your kingdom who has the spirit of the holy gods in him. In the time of your father he was found to have insight and intelligence and wisdom like that of the gods. Your father, King Nebuchadnezzar, appointed him chief of the magicians, enchanters, astrologers and diviners. He did this because Daniel, whom the king called Belteshazzar, was found to have a keen mind and knowledge and understanding, and also the ability to interpret dreams, explain riddles and solve difficult problems. Call for Daniel, and he will tell you what the writing means.
Insight, intelligence, wisdom, a keen mind, knowledge, understanding, the ability to interpret dreams, explain riddles and solve difficult problems – wow! What an amazing list. What is more, King Belshazzar’s mother recognised that the source of these abilities and characteristics was the ‘spirit of the holy gods’ – even though she quite likely did not know which God Daniel worshipped.
I doubt whether Daniel would have claimed those characteristics for himself! The reason he was able to serve different dynasties over many years, perhaps until he was in his eighties, was the way other people saw him. Daniel did interpret the meaning of the writing, but that very night Darius the Mede conquered the Babylonians, killed Belshazzar and took over the kingdom. Darius must have heard about Daniel’s reputation because when he appointed 120 people to rule on his behalf across the kingdom, Daniel was one of three administrators put in charge of them. No wonder those 120 became jealous of him when ‘his exceptional qualities’ (Daniel 6:3) meant Darius wanted to set him over the whole kingdom. It was at that point when they
… tried to find grounds for charges against Daniel in his conduct of government affairs, but they were unable to do so.
They realised that they could not find fault with Daniel unless it was to do with the law of his God. That led to them pushing for a new law that no one should pray to anyone except the king for thirty days. Daniel broke that law and so ended up in the lions’ den. Peter said something similar when writing about the attitudes Christian slaves should have towards their masters:
How is it to your credit if you receive a beating for doing wrong and endure it? But if you suffer for doing good and you endure it, this is commendable before God.
(1 Peter 2:20)
Biblically we’ve got models of excellence in how we should be and how we work and operate. The kingdom of God is one of order and not disorder. One of the examples I use is to look at how slaves were told they should approach working for their masters: it wasn’t do the bare minimum, but glorify God through the way they operated. So very much from my perspective, especially as a church charity, we need to be working from a basis of excellence because it’s a kingdom principle in my opinion.
Nehemiah also recognised the importance of trustworthiness. Before he left Jerusalem for the last time, he appointed people to a variety of roles, one group of whom he considered trustworthy (Nehemiah 13:13).
A prophetic dimension
For Christians, being of benefit to others may have a prophetic dimension to it.
In governance and leadership terms, one or two people need to be a shaker, without wanting to create division: it’s not my view against somebody else’s, but it’s trying to create the dynamic to make the changes that are necessary – there’s a sort of prophetic voice in it.
I am old enough to remember when evangelism and social action were considered polar opposites by Christians: liberals did social action, evangelicals focused on evangelism, and whichever ‘side’ you were on, you were likely to look down on the other. In 1974 the Lausanne Covenant was agreed by a large international group of evangelicals brought together by Dr Billy Graham.(xii) The Covenant itself was mainly shaped by Rev Dr John Stott. It had a major impact in convincing evangelicals in particular that social action was biblical and something they should be involved in. More than forty years later, data gathered by the Church of England and published in 2018 from some 13,000 churches found that 80% of them were involved in one or more forms of social action. This totalled more than 33,000 social action projects which were acting as a social lifeline to their communities.(xiii)
That is prophetic. It says to the community, ‘We care about you.’ It says to local authorities and government, ‘We will do what we can to meet the needs.’ Above all it demonstrates the love of God in practical ways. The decisions necessary to start such projects are very often made by trustees, or those who will become trustees as and when a charity is formed.
It can also be prophetic for a church when trustees ask the right questions, even though they may be difficult or challenging questions to ask. Trustees ought to confront the kind of attitude which seeks to maintain the status quo because it is too demanding or threatening not to.
Sometimes PCCs get so weighed down by the money and the buildings that they feel strangled and not able to engage with the bigger issues. A prime example of that has been in one of the vacant benefices. There is one lady who, in the middle of a PCC who are getting obsessed about everything else, consistently reminds them about the importance of spreading the gospel, to the extent that sometimes she gets so frustrated that she has to leave the room. She’s left the room three times when I’ve been there because she’s got so irate about some of the behaviours around her. But her voice is really important in that meeting because she tells them that what’s really important is that they tell people about the love of God, not that they just keep everything to themselves. There is a feeling in that particular setting that the church is for people who currently go to it and there’s no responsibility towards or interest in anybody else knowing about the gospel. This one woman has made it her mission to make sure that that is a significant part of their discussions every time.
One interviewee, when asked why he became a trustee of a charity, put it this way:
I would need to feel I could make a difference. It’s taken me a lifetime to accept what my gifting is, but I think strategic thinking and forward thinking, and encouraging people to plan ahead and understand the challenges they face rather than skirt round things – that interests me a lot: organisational development, spiritual development, personal development going together.
It is all too easy to separate organisational, spiritual and personal development and focus so much on one that the others get lost. I have come across charities and churches which are very well organised but have poor personal relationships, as well as those where there are excellent relationships but they have lost sight of why they exist. Both are likely to have lost their cutting edge, to no longer be prophetic in their situation, and to be unable to fulfil their ministry as well as they could.
When things go wrong
Unfortunately, things do go wrong in churches and charities. Good governance can sometimes forestall such events and can often minimise the impact when something does happen. I had to handle an accusation related to safeguarding. We had a safeguarding officer and he and I worked hard on understanding the implications of the accusation. We were able to demonstrate that we had appropriate policies in place and explain how we were implementing them. In response, the trustees clarified our position about volunteers and put in place extra training for them. What turned the situation around was when the person who had put the accusation to us, on hearing what action we had taken, was able to say, ‘You know what you are doing, don’t you?’ He then worked to resolve things at his end. Clearly it is easier to take that kind of action in a local charity where face-to-face interaction is possible. For larger, especially international, charities, if something goes wrong it can easily be hidden from trustees, who may not know about it unless a whistle–blower speaks up or the media unearth a situation. The response by charities such as Tearfund to scandals which have hit other charities in similar situations has been to look carefully themselves at what is taking place in their organisation and to make sure they have strong policies in place and relevant procedures to ensure that appropriate action is taken when necessary.(xiv)
Good governance is about knowing what you are doing as far as you possibly can:
Know the rules for governing the charity or church, as per the founding governance document. It’s important to always function within those rules – not to simply become legalistic, but function within the spirit of the rules.
Alongside that, trustees need to know, or have good advice available to them, about laws and regulations which apply to them, especially new ones, or particular issues which are of concern to the Charity Commission or the wider charity world. That means
… a lot of reading. There are plenty of training courses and I think it’s a really good thing to aspire to good governance and for people to go on these courses. They’re run by secular people but there are plenty of very well-run courses. You should pick up the Charity Commission newsletters and read the test cases of things the Charity Commission is doing, to understand the principles. There are governance magazines that are really, really helpful, that pick up on latest cases where the Charity Commission has challenged something and help you understand the principles. They’re good magazines for disseminating the news and analysing it.
There is a list of resources in Appendix 2 which will help with following up on this. In addition to these widely available resources, denominations may provide resources and training at local or national level, while local groups, such as Community Service Volunteers, may put on training.
Summary of the trustee’s role
I believe it is really important that trustees understand what is expected of them. How else can they exercise good governance? When I have been looking for new trustees, I have summarised the key dimensions of our responsibilities as embracing three aspects – vision, compliance and resources:
- Vision is what enables trustees to fulfil the Object of a charity or the purpose of a church in the way God wants them to at this point in time, in this context and on into the future.
- Compliance is ensuring that all relevant laws are kept and best-practice guidelines are followed.
- Responsibility for resources involves establishing what resources are needed for what you believe you should be doing, finding those resources – whether money, people, buildings etc – then using them in the most effective way.
We will look at each of these in more detail later. It seems daunting, but with God’s help:
Do the best you can to comply with good practice, regulations, the rules that apply, with common sense.
The resulting tracks of trustworthiness will honour God and play a significant part in enabling your church or charity to fulfil what you exist for and what you believe He wants you to do to build His kingdom.
Have you ever seen your charity/church’s governing document? Do you know what your Objects are?
What is it about the idea of being a trustee that made or makes you or others scared of taking on the role?
In what ways do you, or would you like to, see integrity and trustworthiness modelled in your context?