The Charity Commission has said trustees do not always reflect the communities that they serve, following calls for it to improve the monitoring of board diversity.
This came in response to an open letter from 65 organisations, which urged the regulator to monitor the diversity of charity trustees and senior executives across a range of protected characteristics.
Written by Black, Asian, multi-ethnic and refugee-led charity Money4YOU, the open letter argued public access to this data would enable better interventions to improve diversity and build trust and accountability in the sector.
The Charity Commission’s response, written from Paul Latham, director for communications and policy, said “taken as a whole, trustees do not reflect the make-up of the communities that they serve”.
“We also know that a lack of diversity can be a risk to good governance. Having a diverse group of people on boards, in terms of background and experience, but also in outlook and personality, helps charities make better decisions,” it adds.
“Diverse boards are better able to anticipate and manage risks, seize new opportunities, future proof their organisations and tackle difficult but necessary decisions.
“Conversely, boards that lack the right mix of skills, experience and perspectives, that do not test and challenge decisions or ideas, are more at risk of ‘groupthink’ and of losing their way.”
Changes considered as part of consultation
The regulator said its would consider Money4YOU’s proposals as part of its ongoing consultation on changes to the annual return.
“We will be making decisions on future questions for the annual return after reviewing issues raised through the responses, including considering the legal basis for us collecting certain types of data and the time requirement for charities to complete their annual return,” reads the letter.
Amicky Carol Akiwumi, founder and chief executive of Money4YOU, said.“This is a promising first step, and I’m delighted that the Commission acknowledges that trustees on the whole do not reflect the communities they serve.”
Nonetheless, she added the Commission “needs to explain why they believe diversity data isn’t necessary” and changes have not already been adopted.