How many charities pay trustees? And other key statistics

13 Nov 2017 Voices

The Charity Commission’s new report into trusteeship contains some significant and serious themes, as well as a wealth of information. We look at some of the most important figures.

80 per cent of charities have no other staff or volunteers

The report says that “in some 80 per cent of the total number of charities nationally, trustees play both a governance role and an executive role – they have no staff or other volunteers from whom they can seek support. They are very small charities both in size and in the resources they acquire and distribute on an annual basis.”

There are roughly 134,000 charities with incomes under £100,000, the report finds, with only 35,000 employees and 116,000 volunteers between them.

A brief glance at the register reveals that these charities are overwhelmingly community-based: village halls, PTAs, church centres, choirs, scout and guide groups, sports clubs, women’s institutes and the like. Most of the rest appear to be either charities set up to distribute a small legacy, or those run by individuals raising money in memoriam.

Trusteeship is worth £3.5bn a year

The average trustee contributes 4.88 hours per week, although the median is much lower - between one and four hours.

This means that if you take a median hourly wage, trusteeship is worth at least £3.5bn a year. Although this does not measure the amount of time trustees contribute to delivering services. Additionally, given that the average trustee is considerably wealthier than the median, the likelihood is that the services they provide are worth far more, on a per diem basis.

Only 5 per cent of trustees are recruited openly

The report shows that 71 per cent of trustees were recruited through informal networks, and only 5 per cent answered a public advert. How the rest were recruited is not made clear.

Formal recruitment is clearly not a panacea, however. Diversity was shown to generally be worse on boards with a higher level of formal recruitment.

Board diversity is shown to be poor. We look at this in more depth in several places - our analysis of the typical board, and the warning from the Charity Commission that trustees are not representatives of their communities.

More than 2,000 charities pay trustees

More than 2,000 charities pay their trustees, according to an analysis of Charity Commission annual returns. This represents 1.6 per cent of all charities.

Paying trustees becomes much more commonplace as charities get bigger. The survey found that 7.4 per cent of charities with annual incomes over £5m paid their trustees.

Our own analysis of the largest 100 charities found that 16 paid at least one trustee, although some were paid for duties other than trusteeship, and some were executive trustees sitting on unitary boards.

There are 150,000 fewer trustees than we thought

The report finds that there are roughly 700,000 trustees in England and Wales, not 850,000, as the Commission had thought.

The Commission had identified 100,000 duplicates on its database of 950,000 trustee roles, but the regulator only recognises a match if name, address and date of birth were identical.

This means that the average trustee sits on 1.35 boards.

It also means that around 1.27 per cent of the population is currently a trustee. Among retired men, this rises to 5.5 per cent.

Around 120,000 new trustees are recruited every year

The research found that around a sixth of the population of trustees steps down from their role each year. Those stepping up and stepping down appear to be roughly in balance, indicating that there is no obvious shortage of candidates for trusteeship.

The median length of service for a trustee is around five years, with trustee tenure longest in the smaller organisations. In the largest charities, median tenure is between three and four years.

Only 9 per cent of trustees think training is very important

The report finds in general that trustees value the Charity Commission far more highly than any other source of outside information. In most cases, their primary reference point is their peers. As discussed in more detail elsewhere, this had led to concern that many boardrooms are echo chambers in which trustees reinforce each other’s views.

Relatively few boards assess their effectiveness. Only 12 per cent of trustees have a formal induction, only a third have a job description, and very few indeed have appraisals.

82 per cent of trustees are confident of their responsibilities

The research is encouraged by the level of knowledge which charity trustees possess about their legal responsibilities. It finds that only 18 per cent of trustees are not confident of their legal responsibilities. (Although in practice many more get it wrong when asked simple questions, and providers of services to trustees are significantly less sanguine.)

This is a significant development on the last major research into trustee roles, which found – possibly erroneously – that a third of trustees did not understand their role at all.

However a companion survey of providers of services to trustee boards paints a much less rosy picture. Providers believe many trustees lack knowledge and skills.

Only 24 per cent of boards have the skills to avoid fraud

The report highlights some serious skills gaps. Only 24 per cent of trustees believe their boards have sufficient skills to avoid fraud, for example, and there are also issues with legal, fundraising and digital.

Only 40 per cent say they have sufficient skills in governance, which is a worry, since this is arguably the board’s primary function.

Once again, providers of services to trustees are less impressed with the skills of boards than boards are themselves.

90 per cent of trustees say it is rewarding

The report finds that trustees mostly love doing the job. It says that 90 per cent of trustees say it’s rewarding, and 94 per cent say it is important or very important to them. There is no particular shortage of trustees, and no evidence that trusteeship too onerous – a welcome finding in the wake of warnings to this effect.

Of course, all this must be treated with a pinch of salt. After all, trusteeship is an unpaid role you can leave whenever you like. Those who do not enjoy and value trusteeship probably do not last too long.

Civil Society News publishes a bi-monthly magazine for trustees, Governance & Leadership, as well as offering a range of trustee training and an annual conference.

 

 

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