September 2022 - Komsec Limited

Definition of a Charity Board Succession Plan

A board succession plan is a document that sets out the process to be followed when a Charity Trustee resigns. It’s very useful to prepare for when a Trustee’s term limit is coming up or when a Trustee departs unexpectedly. The Charity Regulatory advise that a Trustee’s term should be no more than 9 years. They have recently issued excellent guidelines on Trustee Term Limits and Succession Planning, click here.

Induction

Induction should aim to introduce a new Trustee to the organisation, aims, values and provide an overview of the challenges its facing.
Understand their legal duties, responsibilities and personal liability.
A visit to the Charity and meet staff, volunteers, beneficiaries (if possible) and Trustees.
Provide an induction pack, to include set of financial statements, recent minutes, copy of strategic plan and budgets etc. Further information on an Induction Pack from Charity Regulatory Authority here.

Check out the Charity Regulatory Authority Guidance on Induction and Recruitment here

2. Identify Skills Required

This will vary, most charities will need Financial expertise for example. You will need to consider the experience you need, for example do you employ staff? If so, you will probably need HR expertise and support etc. This exercise is very helpful when you’re considering new Trustees

3. Skills Matrix

Circulate the Skills Matrix and ask your Trustees to complete (tick under the skills-sets they already have). You will find that there is a broad variety of skills and experience amongst the Board. Once this exercise is completed, you can easily identify the “gaps” which will help pinpoint the exact set of skills you’re looking for.

4. Review

Periodically review the Induction Process (with feedback from Trustees) and also periodically review the Skills Matrix, which will need to be adapted with the needs of your charity and Trustee changes etc.

Resources

The Charity Regulatory Authority have excellent resources available on their website, links are below.

Succession Planning click here

Induction Pack Checklist click here. Induction and recruitment click here

Everywhere we turn there seem to be advertisements advising us to check our personal health for this that and the other. No doubt all excellent advice but do we ever take time to check our corporate health as directors? It seems to me getting either one wrong will impact on us all to some extent.

There are no blood pressure cuffs when it comes to corporate health but there are a few checks we as director can all do to at least get started.

Management accounts – should be circulated and read by Directors on a regular basis.
Board meetings – should be held at least quarterly where Directors consider the overall direction of the company and do not get bogged down with the nitty gritty which is the role of the Management Team.
Chairperson – how is that role managed by the Board and by the Chairperson. He/she should be capable of ensuring all participants have an opportunity to be heard, and that meetings do not run on for ages. Unfortunately, we have all been at meetings where certain individuals like to hear their own voice no matter the relevance of their words.
Risk Register – does your company have one, and if not why not? A Risk Register (properly managed and regularly reviewed) can save an awful lot of headaches. For example, if you have a supply contract that has to be renewed annually you need to be able to negotiate this ahead of time and not after the event.
Insurance – when were the company insurance policies last reviewed and at what level of detail. It is always surprising how little directors know about insurance cover even on a basic level such as whether or not they are covered under their own company’s director and officer liability insurance.
Statutory filings – does the Board have a timetable of statutory filings even covering basic things such as filings with the Revenue Commissioners – Companies Registration Office – Central Registry of Beneficial Ownership.

Having the basics in place can help to ensure issues are dealt with in a timely manner with minimum fuss. Now don’t tell me that doesn’t help keep your blood pressure down!