No doubt most charity trustees and managers believe they run their organisations effectively. But effectiveness is like art - easy to recognise but difficult to define.
Perhaps with this in mind the Charity Commission has attempted to bring objectivity to the subject with its new publication CC60 - The Hallmarks of an Effective Charity.
The latest release is an update of the Commission's earlier publication Hallmarks of a Well-run Charity. The change to the title may seem minor. But this version not only provides guidelines for charities to follow, it concentrates upon the achievements, performance and impact of effective charities.
It should be stressed that these are not legal requirements. Instead, the document sets out a framework for effectiveness that charities can work towards'. It has been designed for charities with income over £250,000 but most charities, apart from the smallest, should aim to follow its principles. In several ways, this new publication is an improvement upon the last. It contains fewer hallmarks - in itself an improvement - and they concentrate upon the practicalities of charity management. In all, there are six hallmarks under the following headings:
- Focus on impact and outcomes
- Fit for purpose
- Sound governance
- Maximising potential
- Accountability and transparency
- Flexibility
For each topic there is an overriding principle, simply stated. This is followed by specific details indicating how a charity can meet these principles and demonstrate its effectiveness. To illustrate the point, consider hallmark number three - sound governance. In this case the principle is as follows:
An effective charity is run by a clearly identifiable trustee body that has the right balance of skills and experience to run the charity effectively, acts in the best interests of the charity and its beneficiaries, understands its responsibilities and has systems in place to exercise them effectively.
Although straightforward enough, the principle extends to a number of areas. To help a charity decide if its activities are in keeping, the Commission breaks it down into specific points. These include matters such as trustee induction and the importance of ensuring that there is a mix of trustees with relevant skills. In effect, CC60 provides a checklist that will help charities evaluate their work and structure.
An important point to bear in mind is that when the Commission decides to pay a review visit to a charity they will arrive with CC60 in hand and use it as a benchmark of good practice. It would therefore be wise for every charity to study the updated guidance carefully and incorporate each of the principles that is relevant to it.
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