Corporate Governance & Paying NFP Boards-UK Report
4 April 2002 at 1:04 pm
A two year study in the UK of Corporate Governance in the Public and Volunteer Sectors has recommended that board trustees in the Not for Profit sector be paid in amounts comparable with chairs and non-executives in the public sector.
The report says the amounts paid should take into account the size of the organisation so that small and medium charities are not required to make payments that might effect their visibility.
Generally the report found that tangible and lasting improvements to UK public services would only happen when the boards of management are reformed.
The report considered corporate governance in the National Health Service, Non departmental Government Organisations and the Voluntary Sector with contributions from over 200 participants.
The report was carried out by The Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA).
Author of the report, Paddy FitzGerald, says that to achieve meaningful change at the national level requires a huge effort. This project is about the delivery of change without a vast financial expenditure or unreasonably long time-scales. It is not just a question of service levels; real accountabilities rest on more reliable information, new ways of measuring performance and the right amalgam of people if effectiveness is to be linked with efficiency.
The survey’s recommendation received mixed reactions from participants including comments that concluded that 48% of new charities registering in the UK today have the right to pay trustees but that doesn’t mean they pay them, but they reserve the right to do so.
Another participant commented that it was a slippery slope when devising reasons why all the Board might reasonably have a right to be paid!
The Association of Chief Executives of Volunteer Organisations was a little more subtle in its comments.
It’s own Chief Executive, Stephen Bubb says getting the right relationship with a Chair and Trustees is the biggest challenge facing a CEO. It’s crucial for long term success and getting it wrong can be fatal.
Founded way back in 1754 the UK RSA charity works towards creating a civilised society based on a sustainable economy.
The RSA says it uses its independence and the resources of its international fellowship to stimulate discussion, develop ideas and encourage action in its main fields of interest; business and industry, design and technology, education, the arts and the environment.
The full report delivered in February has some fascinating results about stakeholders, priorities and board performance apart for the issue of payment!
If you would like a copy of the report in PDF format send us an e-mail to corpnews@probonoaustralia.com.au.
