Trust me, I'm a (paid) trustee

empty office with table and chairs

Trust me, I'm a (paid) trustee

Ever since Lord Hodgson’s review of the Charities Act recommended that charities with an income of over £1 million have an automatic right to pay their trustees, arguments have raged on both sides. Lord Hodgson and his supporters say that the change will help charities attract the best and brightest for the boardroom. Opponents are concerned that payment will further erode the voluntary ethos that the charity sector is based on.

At first glance, it certainly seems strange that at a time when charities are turning more and more of their entry-level jobs into unpaid internships they should simultaneously decide that the most senior members of their organisation (who have always been volunteers, with few exceptions) deserve to be financially rewarded for their time.
 
Compared to the often full-time job descriptions of interns, the role of a trustee seems to be ideally suited to a volunteer – a few hours a month as well as the occasional board meeting, with out-of-pocket expenses covered. Do charities really want to be run by people who aren’t willing to give this time freely to the cause? And if money can’t be spared from charitable activity to pay interns, how can charities afford to pay trustees?
 
Others have been concerned that this move could lead to an 'arms race', where charities are forced to pay trustees in order to attract the right calibre of candidate because their competitors are doing the same. Ultimately, charities could end up with trustees no better or worse than those they currently have, but at a much higher cost.
 
But perhaps the most compelling argument against paying trustees is that it could put at risk the carefully nurtured and well respected public image of charities as voluntary organisations. We know from our research that charities are currently enjoying a boom period in public trust, with 64% of people saying they trust charities a great deal or quite a lot. This has come at the same time as a decline for other institutions which the public have come to see as greedy and financially motivated – banks and the government. Could the payment of trustees become the bankers’ bonuses or MP’s expenses of the charity sector?
 
We know that staff pay is one of the biggest issues donors worry about when choosing a charity – 57% of the public say they would be off put by charities spending too much on staff salaries. Conversely, donors find voluntary service highly reassuring in charities, with 42% saying they would be confident a charity would spend their donation well if it was run mostly by volunteers.
 
So while some in the sector might sniff at old fashioned ideas of charities’ “unique ethos”, the public at large certainly don’t share their beliefs. Rightly or wrongly, the public are more likely to trust (and therefore more likely to support) charities they think are run by committed volunteers rather than financially-motivated staff.
 
With only 28% of people currently believing trustees are paid, charities should think carefully before potentially risking public trust and support by making the decision to pay them. I think there is much to lose and little to gain.
 

Cian Murphy

 

Do you Trust in Cian's judgement? Or do you think paying is above Board? Leave a comment below.

Submitted by A Roberts (not verified) on 4 Oct 2012

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I think charities should be able to pay trustees – as long as they do actually work for the charity. The whole idea behind the set-up at the moment is a bit bonkers.

I recently launched a charity – of course if I want to ‘run’ it I have to become an unpaid trustee. However I need a wage, so I’ve had to find 3 people to be trustees – yet I’m the one with all the expertise in this field.

I’ve been trustee to several charities and it’s usually the case that the trustees know far less about the charity than the paid staff – yet the trustees are supposed to make the big decisions. In reality I suspect most Trustees are nothing more than signatories who sign what they are told to sign.

Submitted by Rob Jackson (not verified) on 4 Oct 2012

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An excellent article, thank you. I especially like the observations about entry level interns being unpaid whilst senior governance roles - ideally suited to volunteers - are being considered as paid roles.

Submitted by Dennis A Atkin (not verified) on 4 Oct 2012

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I am a Community Governor for a local school for children with learning difficulties and Trustee for a Local Charity delivering services to those suffering domestic abuse. Prior to entering these positions I aquired an in depth knowledge of services they provide in that I am the grandparent of child with autism who attends the school and for 40 years prior to me retirement earlier this year I have been working in the context of delivering services, developing policy and training in the issues of domestic abuse. So I beg to differ with the comments raised by A. Roberts anything I sign and by consequence agree with is backed up by the knowledge I possess.My current role as a Trustee is vocational(unpaid) but armed with a level of expertise I possess that is acknowleged by many of those I work and associate with.Not a supporter of having paid Trustees I would however support the view that they are paid out of pocket expenses.

Submitted by Sophie (not verified) on 4 Oct 2012

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If people can afford to volunteer as a trustee then they should; but unfortunately this means that most charities' trustees are retired and/or wealthy (or at least financially secure) people who often do not represent the people the charity is trying to help. In order to diversify trustee boards and make them more representative, charities should offer a reasonable wage to those who would not otherwise be able to offer their time. Many people who should be on trustee boards are working multiple jobs to keep their heads above water, have childcare needs or cannot afford travel and others costs needed to take on this role; a small wage could enable them to take part. But that's the only scenario where wages should be paid.

Submitted by Jon Scourse (not verified) on 4 Oct 2012

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As a Chairman of one charity and a trustee of another, my greatest concern with regard to payment is the impact on the internal dynamics of the Board itself. If some are paid and others are not, surely this will de-motivate those that currently give a great of time and goodwill (and in many cases personal cost) but would not be rewarded financially. Inevitably there will be resentment that the paid "experts", probably already well paid, are gaining a benefit. Having recently re-structured an entirely new trustee board, I have not had any problems in attracting talented trustees, specially targeted for their expertise. They seem very pleased to be doing this work providing any exceptional out-of-pocket expenses are covered - and they work as a brilliant team. I would be quite uncomfortable if any some were paid, as they all bring great benefit to the charity.

Submitted by Ian C (not verified) on 4 Oct 2012

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This is in response to the first comment by A Roberts. Trustees are not there to be the experts in the particular field, or to run the day-to-day operations. They are meant to be critical friends who can independently check strategies, policies, accounts, budgets, risks, plans etc from a variety of points of view. If the (paid) Chief Executive needs to be a trustee, the Board can always apply to the Charity Commission to allow this, though it may require a change in the charity's constitution.

What worries many experienced trustees and commentators is the proposal (it is only a proposal at this stage) that any trustees of larger charities can be paid without any checks by the CC, when experience suggests that there is no shortage of suitably qualified volunteers already in post. With cheap online advertising for trustee posts now widely available, the "pay" solution seems even less relevant than it may have been in the past.

Submitted by Rob Jackson (not verified) on 8 Oct 2012

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Sophie. The same end can be achieved through reimbursing out of pocket expenses. This is already possible and provided by many organisations. As such the argument that pay/wage should be provided to allow people who may not otherwise be able to afford to volunteer for the board simply doesn't stack up.

Submitted by Anonymous (not verified) on 8 Oct 2012

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Thanks for the responses to the article, glad to see it's generating comment. I would of course agree that out of pocket expenses should be covered by the charity for its volunteers, wherever they sit in the organisation!

I think the issue of diversity on the board is something that maybe I should have addressed first time round, as I can see where people are coming from when they say that boards are already a bit too male, middle-aged, middle class and white and that paying trustees could improve the situation.

However, I'm not convinced the time requests on trustees in most situations are such that working a full time job would prevent you from taking up a trustee role - indeed nfpSynergy staff members have been unpaid trustees while working here in the past. I'm also concerned that the language around "attracting the best" often used by advocates of paying trustees in reality means attracting more male, middle aged "captains of industry" to the board, rather than finding a more diverse group of people.

Submitted by Kevin Baughen (not verified) on 9 Oct 2012

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Hang on! It's insulting to those who can't afford to give up working hours for volunteering to suggest that 'expenses will cover it...'

And generalised research does not, of course, provide the insights to develop effective solutions for every case. Take my current Trusteeship example:

I sit as an external Trustee on the Board of a University which wants to engage more students in the Board as Trustees for very obvious reasons. The kinds of engaged individual candidates who would add value are either independently wealthy or holding down part-time jobs to fund their studies and therefore don't have the time needed.

And as financial-worry-free students aren't in the majority, we won't have a genuinely representative list of candidates unless we can perhaps offer some financial reimbursement to the right, vetted and interviewed individuals.

Please explain why and how this undermines the principle of public trust...

Submitted by Rob Jackson (not verified) on 9 Oct 2012

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Hi Kevin, I was responding to a specific set of scenarios Sophie highlighted.

The situation you outline is different and I agree providing expenses wouldn't cover this or any other 'loss of earnings' issue.

As someone who is self-employed, I can understand the concern about donating time that isn't going to get paid for. Quite literally, my time is money.

That doesn't stop me volunteering though - I find the time and make it work. I'd never dream of being paid for that volunteering though (and I am far from independently wealthy) because my independence could be seen to be compromised if I was taking pay (however justified it may seem) from the organisation engaging me in a governance and oversight role.

In such a situation public trust may well be at risk as trustees would seen to have a vested financial interest in the outcome of their decisions.

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