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Why paying Trustees might be a good idea

18/07/2012

Lots of media and social media coverage around the recommendations within Lord Hodgson’s review this week.  Particularly the proposals around whether large charities should be allowed to pay Trustees without seeking the permission of the Charity Commission.

This has resulted in an open letter from Volunteering England, NCVO, Navca, Directory of Social Change, Institute of Fundraising, Small Charities Coalition and Community Matters to the Civil Society minister Nick Hurd directly opposing the recommendations.  The collective experience of these organisations and the smart people concerned mean we should seriously consider what they have to say and why they are so against Trustees being paid per se (as the media is implying).

But firstly I’d like to know whether the objection is to Trustees being paid per se or whether it’s specifically around larger charities being able to do so without having to ask permission.  Credit to @karlwilding from NCVO and the folks at Volunteering England who have both been very quick in presenting their views transparently today when asked.  From what I’ve read so far, the objections appear to be to Trustees not being paid at all.

And I’m not sure why so I’d like to examine a few of the points and offer an alternative point of view for consideration…

There is no evidence that paying Trustees increases diversity

Perhaps not but neither is there a concrete and robust body of evidence which suggests it doesn’t either.  For years, a whole raft of organisations have used positive action to recruit, develop and retain people to support building representative teams.  And, for example, this has included larger financial allowances for women returning to work in certain roles after starting families and greater training bursaries for teachers preparing to offer science subjects  – are they all wrong?

In the absence of any study (that I’ve seen or could find anyway) I would wager that a great many Trustees are either self-employed, retired or independently wealthy ie; they have time and/or money.  Diversity includes encouraging the contributions of working folks and the less well-off too.  And by working I mean anyone who can’t get time off work to volunteer regularly without it impinging on their ability to earn a living.  Diversity also includes a  skills balance as a Board full of retired CEOs may be useful for their fundraising contacts but who is going to make the tea?

The report focuses on the  important ethos of volunteering as a core strength of charities which objectors say would be undermined

So why do we pay our staff then?  Many Trustees commit considerably more time to the causes they support than merely attending Board meetings, particularly for smaller charities with less experienced or under-resourced leadership teams.  If this impacts on their ability to earn income elsewhere, why should they bother?

The public might lose faith in charities if we pay Trustees

If we ask supporters whether they want to donate to feeding starving children or paying the electricity bill, we all know how they will answer.  Yet charities still need to pay the bills and donations or public funding are spent as such.  They also pay membership and audit fees to a range of governing bodies so I wonder how donors would react if we replaced electricity bill with these costs? (and I know first-hand that these organisations do great work to support charities but I’m not sure donors would see it that way).

There might be a sense of impropriety if Trustees are motivated by money

Otherwise called ‘moral hazard’.  As a Trustee myself, it’s actually insulting to see this suggestion written down.  If a charity needs skills and a level of commitment that paying the right Trustee might be able to secure, then why do we assume that the individual will automatically turn into the offspring of Nick Leeson and Bernard Madoff, just because they are receiving some form of financial remuneration?  Charity leaders sitting on recruitment panels won’t suddenly take an idiot pill and choose the wrong people because there is money involved.  I don’t get paid to be a Trustee and don’t need to be but if I was, I would like to think my contribution wouldn’t suddenly drop in value.

And who said that Trustees will be paid huge sums of money anyway?  What about if it’s only minimum wage for hours committed, just to make things a little easier financially for the Trustee to commit the time and skills needed or indeed to pay for things like childcare or an intern to cover the work they should be doing elsewhere…?

Paying Trustees doesn’t improve outcomes

How can we possibly know this for a fact given that the huge majority of Trustees are not paid and therefore no robust research has been done to prove this one way or the other?  Has any charity been paying its Trustees for long enough to be able to conclude they are wasting or valuing their investment?  Seriously, if so please do join the debate as I think your experiences will be hugely valuable.

It costs money when charities shouldn’t be spending on non-core activities

Aside from the point above about fees, levies and memberships etc. do any of us know how much it has cost charities in external consultancy, professional advice, legal fees etc to deal with issues that perhaps a skilled and qualified Trustee may have been able to deal with in-house?  I know of at least three that would have valued an expert in HR on the Board prior to ending up in arbitration and employment tribunals which ended up being very costly.

For what it’s worth, I think this is a sensitive issue and I’m not at all surprised there are passionate and conflicting views on whether Trustees should be paid.  So how about we consider some very simple principles just to frame the conversation:

  • If a charity needs the kind of representation or skills it can’t afford as part of it’s paid leadership team, then let them consider paying or financially incentivising a Trustee to deliver very specifically – if it works for the charity
  • Set time limits for delivery, like a fixed-term contract so that no charity is tied into a financial relationship for any longer than they need to be
  • Set sector-wide limits as to what Trustees can be paid and test them in practice for an agreed period.  Then review and amend accordingly based on real findings (I hear the screams already but we have to start somewhere, catering for the majority need, not the minority problems)
  • All the relevant laws of the land apply in terms of sensible contracts and liabilities so there is as much protection for the charity as with any employee or other Trustee

And lastly, let’s accept that good volunteers come from all walks of life, not only those who can afford the time and sacrificed income to volunteer.  In any other facet of people in charity, we proudly wave the flag for meritocracy so why should this be any different?  At least why shouldn’t we try and consider all options to help us get the right people to deliver our objectives in very challenging times?

What do you think?

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2 Comments leave one →
  1. 20/07/2012 3:11 pm

    I am surprised that it is even a consideration to ever pay a Trustee. One of the main functions of a Trustee is to fundraise for a charity. To pay them is counterproductive to the giving and fundraising culture we should be trying to create and cultivate!

    • 20/07/2012 5:44 pm

      Thanks for your thoughts Shannon. But fundraising staff get paid right and Trustees have an awful lot more to do as well as fundraise. For example, I know a charity that’s looking for a Trustee specifically to support their catering social enterprise. Could it be considered then?

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