A Governance Code and Financial Reporting a Must for Charity Sector

Governance and accountability means that there must be clear lines between the day-to-day management of the organisation and its board. It also means there must be clear procedures in place for the recruitment and turnover of board members. The duties of a board are reasonably onerous in the case of any organisation that wants to be compliant — for example, they have to have policies that promote an ethical culture, and they have to be especially aware of conflicts of interest. The key to all good governance within the sector, though, is transparency. No organisation that fails or refuses to publish, in a readily accessible way, an annual report of its activities and properly audited accounts can ever be regarded as reliable. Although the governance code doesn’t specify that, for example, the salary levels of senior management staff should be clear, there are other standards that many charities adopt that do require that.