Thursday, July 15, 2010

What is a trustee?

There are two types of trustee - holding trustees and (managing) trustees. Where a charity is not incorporated it is not a legal entity and therefore cannot own property. So where there is property, as with chapels and meeting houses, someone has to legally own that. There are two types of owners possible

- holding trustees: who are people whose sole role is to hold the legal title to the property in their name (there are usually three+ holding trustees); and
- custodian trustees: which are incorporated organisations which hold the title to the property. The B&FUA (British and Foreign Unitarian Association) is often used to do this for both the General Assembly and its member congregations.

You can have a mix of holding and custodian trustees. Holding trustees should have no role in governing or administering the charity although in practice this often happens as there are so few people willing to take on such roles. There is also an official custodian who can hold the title of a property - this is administered through the Charity Commission.

Other (governing) trustees - the type that we are normally talk about - are the people entrusted with ensuring that a charitable organisation meets its charitable object. The object details what the organisation was set up to do, its reason to exist.

The three things that trustees must be very aware of are

** their charity's governing document (often called a constitution - more on this later) which includes its object;
** the law of the land (charity law and more general law e.g. health & safety, equal opportunities and employment); and
** good practice for running charities. Being aware of good practice and aiming to work in such a way should ensure that the charity's resources - time, effort, skills, money etc - are used efficiently.

Trustees have clear legal duties when it comes to their trustee role. They are individually and severally (i.e. as a board) liable for the charity and depending on the legal form of the charity may or may not have financially limited liability. But limited financial liability only protects if the trustees have acted legally and with due care and attention.

Trustees are volunteers and can only in very rare circumstances be paid for any of the work that they do for the charity - and if this is possible it must be detailed in the governing document. It is usual for trustees to be able to claim reasonable out-of-pocket expenses like travel and car parking fees. It is also a good idea for a charity to have an estimated budget figure for the cost of trustee meetings (venue hire, refreshments and travel expenses) - to invest in its governance.

If you believe that working as a trustee for a charity can make a real difference to people's lives then it can be a wonderful experience in particular if your fellow trustees are like-minded and hardworking. But it is not a position to be taken on lightly or without finding out exactly what it may entail.

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