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12 steps to improve trust in your charity

Sep 01, 2019

While trust in charities has gone up, only a minuscule percentage of people completely trust Irish charities. David W. Duffy explains how charities can turn that around.

According to the Charities Institute Ireland, trust in charities has risen from 24% in 2017 to 30% in 2019. However, only 1% of respondents completely trust Irish charities.

It’s understandable. The sector has been blighted by many well-publicised governance meltdowns in the sector over the last 10 years which has had a huge impact on trust and giving.

Good governance is key

Good governance is about transparency and accountability. Organisations with good governance should not hide their light under a bushel. They should be open about what they do well. How they should demonstrate this is slightly harder. So, what can charities do to visibly demonstrate that they take governance seriously?

12 important documents

The solution is not a mystery. Every charity should be publishing the following documents on their website to demonstrate willingness to be accountable and transparent:

  1. The Code of Conduct for the Board;
  2. The Annual Report;
  3. Terms of Reference for all board committees;
  4. Board policies;
  5. Reports by the Chairs of board committees on their stewardship for the year of their committee;
  6. Biographies of all directors and length of terms they have served;
  7. Attendance record of directors at board and committee meetings;
  8. A donor charter;
  9. Financial accounts with the salaries of all senior management displayed in appropriate salary bands;
  10. The date of the last board review, the scope and results of the review, who carried it out, and their qualifications;
  11. Indicate that they are compliant with the Charities Code and, if not, an explanation; and
  12. CPD programmes attended by the directors in the last 12 months.

If your charity operates in the USA, get your governance rated by such organisations as Charity Navigator, CharityWatch, Universal Giving, Philanthropedia, GiveWell, Great Nonprofits and The Life You Can Save.

Although Charity Navigator does not operate in Ireland, by following its criteria for highly rated organisations, you can bolster your reputation among donors.

A part of Charity Navigator rating equation is the assessment of the ratio of overhead expenses (particularly fundraising costs) to a non-profit’s overall budget. Donors want most of a non-profit’s revenue to go toward its programs. The Ireland Funds in the USA have a four-star rating – the highest one can get. The more sophisticated donors will be guided by a charity’s rating when considering their donation.

David W. Duffy is founder of The Governance Company and author of A Practical Guide for Company Directors and A Practical Guide to Corporate Governance.