Consultation on guidance for charities that are connected with non–charitable organisations
April 5, 2018
The Charity Commission has opened a consultation about new guidance to help charities manage their relationships with connected non – charitable organisations. The new guidance is closely linked to the core principles of trustee duties which trustees are expected to follow and the aim is to have one single piece of guidance available to address a full range of structures including trading subsidiaries, commercial businesses that have set up charities, charities that receive funding from non – charitable organisations and those involved in shared projects.
The Charity Commission stresses that it is common practice for charities to work closely with non – charitable organisations. However, trustees must manage these relationships properly in order to fulfil their legal duties and maintain public trust and confidence. It is vital that the public is able to distinguish between the charity and the non – charitable organisation, particularly where they share a similar name.
The draft guidance stresses that trustees must, among other things:
- Actively manage the relationship in compliance with their legal duties and the law
- Preserve the charity’s separation and independence from the non – charitable organisation
- Manage the risks arising from the charity’s association and/or work with the non – charitable organisation
- Make decisions in accordance with their legal duties
- Identify and avoid conflicts of interest and loyalty when making decisions
- Be accountable about the relationship e.g. by complying with all relevant accounting and reporting requirements.
The consultation ends at 5pm on 15 May 2018 and the Charity Commission is keen to hear from as wide a range of charities and advisers as possible, to ensure that the final guidance is as clear and helpful as possible.
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If you would like to discuss the above blog in more detail, or you would like to speak with a member of our team, please contact Tracey Johnson or call 01772 821021 to be put in touch with a member of our Charity and Not for Profit team.