Presented on Monday 2 November at NCVO/BWB Trustee Conference 2015. Afternoon keynote - Margaret Casely-Hayford, Chair, Action Aid If you would like to find out more about our 2016 Trustee Conference email us at ncvoevents@ncvo.org.uk or call us on 020 750 3153.

1. NCVOConference – Speech
1. Introduction
 Thank youto the NCVOfor invitingme tospeakatthis conference. Itsaysmuch formodern
societythatgovernance canbe the central focusfor suchan event!
 My talkwill take the followingbroadshape:
An overview
An unpackingof thatoverviewbyreference tothe governance structure and governance
activitywithinActionAid
Andthree proposalsonwhichI wouldwelcomequestionsandcommentsindue course
Evenas a personwho’sbeeninvolvedingovernance inone wayoranotherall my life,whetherasa
lawyerinthe City,or as Directorof Legal andCo Sec at JohnLewisor as Chairof ActionAid,the last
fewmonthshave beenasurprise forme.I’ve heardthe word‘governance’usedsoofteninthe
mediaalmostona dailybasis,andparticularlycharitygovernance,thatinfashiontermsone might
say governance isthe newblack!
My backgroundisthat of a lawyerspecializinginplanninganddevelopment,workedinthe City
for 20 yearsbothopposite andwithcentral andlocal government inprocurementandinmany
regulatedareas;andthenas Co Secand GC forJLP for almost10 years. I am delightednow to
be Chair of the AAUK board. As youcan imagine –withthat background,almostthe firstthing
that I embarkedupononarrival at AAUKwas to initiate agovernance review.NotbecauseI
suspectedanythingof beingwrong! Butbecause Ineededtoassure myself of quite how right
thingswere!
We as a board of trusteesare,withmanagementof AA are notonly entrustedwithdonor’s
money;butalsothe outcome of the terrificinputfrom volunteers’andthe staff’s time and
energy – but there is alsoa huge value tothe reputationandethicof the enterprisethathas
beenbuiltupoverthe years.Andthis isas importanta part of the organizationasthe people
and as the financial assets. Thatbecomespartof the Brand. That we as a boardare requiredto
protect. That’s whatgood governance isabout. Protectionof the assets,includingthe
reputational asset. We onlyhave toconsiderVolkswagon orthe Co-optorecognise the
importance of protectingthat.
What I bringwithme is a keennessforeffective lighttouchgovernance; afervourfora system
that isopenand transparentanda passionfora systemthat is easyenoughforpeople tosee
and understandata glance. A systemthatmakesit clearwhohas whatresponsibilitiesand
accountabilitysothat the relationships are obvious.Itshouldbe easytosee whodelegatedthe
responsibility;whogave the dutyandto whomthere istherefore adutyowed. Itshouldbe
clearwho receivesandhasoversightoverreports aboutthe wayinwhich functionsare being
carriedout. What doesthat mean?Itmeansthat we needto have arrangedour enterprise so
that itsverydifferentfromFIFA!
 AccountabilityforAAUKhasmultipledimensions –because like anyothercharity,ActionAidis
responsible tothe beneficiaries, sohasto ensure continuityof fundingsothatcommitted
programmesdonot endsuddenly and can be properlyplanned;andhastobe accountable to
donorswhethertheyare governments,foundationsorindividuals and inadditionbecause of
our decentralizationAAUKlikethe otherassociatesandaffiliates withinthe Federation, is

2. accountable tothe International Secretariat. Asa memberof the federation hasadutyto
complywiththe rulesof the widerorganization,andtocarry out whateverfunctionsithasbeen
askedto carry out to itas part of the delegations andthismakesaccountabilityvery differentin
the AA context,because of the Federation. More aboutthat later.

 Role of the board in accountability
An Organizationhasoftenbeendescribedasa body. The managementandstaff are the heart
and the hands and the boardis the head. The boardoperatestoreflectthe viewsof
stakeholdersandtoquestionthe heartwhichwill have discretionastohow the resourcesare
applied. Youwill onlyhave toconsiderwithKidsCompanywhatcanhappenwhenthe head
doesn’tquestionthe heartsufficientlyrigorously. Whywere there noreserves? How longhad
such a systempertained?Asaboardof trusteeswe have tolookbothto protectingand
promotingthe interestsof the beneficiariesandensuringthe donorsbe they institutional or
individualreceive sufficientassurance aboutthe wayinwhichthe resourcesare beingapplied
and where the prioritieslie fromprogrammesandthose whobenefitthroughthe campaigning
and advocacy.
The role of the charitable sectorin the civil space gradually disappears and is increasinglyrestricted
by governmentaction. Toldtosticktoour knitting! LobbyingActhastriedto curtail our advocacy
and political work.Butthe Quakershistoricallyfamouslybuiltandlobbiedforaffordable housing;
and lobbiedforanendto the slave trade.Sothere isclearlyroomfor the rightsort of advocacyto
underpincharitable operations. Ischeckingthat we operate appropriately withinthe political
sphere also part ofour good governance mandate? Surelyit must be!
The CharitySector has beenluckyinnotbeingexternallyinvestigateduptonow. Shouldwe now be
on the frontfoot,rather thanbeingpurelyreactive. Andif so, how do we persuade the publicthat
governance is a priorityforand howdo we decide whatresource implications thisshouldcarry?
In myviewthe distinctionbetween the wayinwhichthe public,charitableand private sectors
considerandreact to governance requirements isarbitrary! There are appallingconsequencesfor
failure todeal appropriatelywiththisineachsector.
Let’s unpack that a bit!
Last Thursdaymorningon the Radio4 Todayprogramme there wasa segmentonKids’Company –
some of you mighthave heardit.Tim Loughton,whohadbeenMinisterforChildrenwithoversight
of the relationshipbetweenthe DepartmentforEducationandKids’Companyuntil 2012, said(andI
quote):
WheneveryouaskKids’ Company:
“Let’shave the data, let’shave the performance indicators”
You’re told:
“We’re not goingtowaste time on all that bureaucracyandif youforce us then
there’ll be some notveryfavourablemediastoriessuggesting thatyouwantto
waste moneyonbureaucracyrather thanspendingitonthe kids.
NowI don’twant to getintothe rightsand wrongsof whosaidwhat,because there’salready
enoughflyingaroundaboutthe demise of Kids’Company.Butonits’ownI foundthisvery
interesting,because itsuggeststhat‘bureaucracy’ –that is,monitoringandevaluation,governance

3. and the like – isconsideredinthe mindof the mediaandthe publictobe a waste of money.More
worryingly,itsuggeststhatsome charityleadersfeel thisway.
 Governance hasbecome a “dirtyword”and there needstobe realignmentinthe mindof the
publicand mediaaboutit.
2.1 Pressure on the Charity sector
 It’sbeenan awfulyearfor the charitysector.A recentCAFsurveyfoundthatthe public’strustin
the sector hasdeclinedto57%, downfrom71% inthe CharityCommission’ssurveyayear
earlier.Thisisa shockingchange.
 Perhapswe shouldnotbe so surprisedthattrustin charitieshasdeclined - somanymajor
institutionsare losingpublic'strustcomparedwith20 yearsgo.
o Police - followingPlebgate anddetailswhichhave emergedfromStephenLawrence
enquiry.
o Politicians –the expensesscandal andmore recentlycasessuchasLord Sewell.
o Banksand businesses - aftertheirappallinglackof goodgovernance andlackof
transparencyledto2008 crash, the Co-op'scrashingfailure due tolackof goodgovernance
and lackof effectiveNEDscrutinyof the Board.
o International organisationssuchas FIFA. [elaborationonFIFA ‘slackof transparency]
(Importanceof joining thedotsbetween understanding you Mission,assessing theRisks
attached to its implementation,creating thestructureto deliver and to overseethat
delivery; and importantly creating transparency around thejoining of thosedots - asone
speakerreferred to earlier)
 It seemsit’snowthe charitysector’sturnto come underthe scrutinyof the publicandmedia.
The Olive Cooktragedy, fundraisingmethods,CEOsalariesandgovernance have all beeninthe
firingline.
 While the popularmediacoverage hasbeenanythingbutbalanced,there isnoquestionthat
there have beensome shabbypracticesgoingon,andif we wantto retainthe public’strustthen
we shouldbe beyondreproach.
 The common denominatorinthese casesislackof appropriate scrutinybythe Board,and a lack
of transparency.
2.2 What is governance for?
 What isgovernance for?To give the publictrustand confidence thatthe charityisdoingthe
rightthing
 Trusteesspeakforthe beneficiariesof the charity
 Accountable notjustto beneficiariesbutalsotosupporters.Charitiesdon’talwaysdoenoughto
listentoour supportersandtell themhow we spendtheirmoney(eg.AAUKAccountabilitywork
here inthe UK).
2.3 What is the board for?
 Make decisionsaboutrisk
 Holdthe staff toaccount

4.  Blue-skythinking–ActionAidcurrentstrategyperiodwillcome toan endsoonand plansare
well underwaytomake sure the Boardhas sufficienttime andspace tothink aboutthis,and to
leadthe organisationforwardittermsof whatwe prioritise overthe nextfew years.
2.4 The questionis: howcan we asa sector move to prioritiseimproving governancepractice in
charities? Some suggestions!
3.1.1 Needfor regular changes incharities
 The Cass review Delivering EffectiveGovernance:Insightsfromtheboardsof largercharities
foundthat a fifthof themhave nomaximumtermsof office fortheirtrustees.How isthe Board
meantto bringinfreshideasandmove withthe timesif thisisthe case? AlanYentobhascome
infor a lot of criticismforbeingChairof Kids’Companyfor20 years.
 Thisis reallyworrying,giventhatrotationandrenewal isone of the mostbasicpreceptsof good
governance.Itratherputspaid to the ideathatbig charitieswiththe resource toinvestin
governance alwaysgetitright.
3.1.2 Investmentin Governance
 As I saidat the start, it usedtobe consideredthatgovernance isboring.
 Who can affordto take that viewnow?If the DailyMail thinkscharitygovernance is sexy enough
to reporton thenthe ideathat it’sboringislongpast,and now it’swhat mightgetyou inreal
trouble.
 The big issue is whetherwe can put more time and resource into governance while showing
proudly how little we spendon governance.
 We’re all guiltyof it– almostall charitiesproduce neatlittle tablesdesignedtoshow how little
we spendongovernance.
 I’mnot suggestingthatwe should all ditchthattype of performance reporting because Ithink
the publicdoesfindituseful, - infactit underlinesthe sortof transparencythatperhapsFIFA
coldhave done with – givingline of sighttoexpenditure onthe bureaucracy butwe all playour
part inencouragingthe myththat expenditure ongovernanceisabad thing.
 By all means keepcosts as low as possible,butbe clear that for the publicto have trust and
confidence incharities,you needstrong, professional governance,andthis does cost money.
 The short answeristhat we shouldall be spendingmore ongovernance, andinparticular in
making sure there’ssomeone whoknows about this at the charity.
o For largercharities,there shouldbe someone onthe staff.EarlierthisyearActionAid
decidedtocreate a newrole fora technical governance specialisttomake sure thatwe’re
doingthe rightthing.
o Smallercharitiesthismightensure theyhave Trustee withexperienceingovernance –
perhapsa lawyerbutnot necessarily –whohas particulardelegatedresponsibilityfor
governance withinthe organisation.Getthema copyof the NCVOGuide toGood
Governance – it’sonly£5.00!
 It’stime for donorsto growup and to recognise thatpartof the Trustees’dutyisto have a good
governance function,and thishasa cost.
 It's a matter of lawthat corporateshave to have a good governance functionasaresponse to
the Auditcommittee oversight. Manycharitieshave a turnovernotunlike majorcorporates,and
evenwhere theydon'ttheyshouldbe expectedtotake similarcare because theirstakeholders
are bydefinitionthe vulnerable. It'sbizarre thatlegislationexpectsmore whenone islooking

5. afterthe moneyof shareholdersthanof those donatinginthe interestsof the mostvulnerable
insociety!
 Kids’Companyistestamenttothis.The cost of not havingthisfunctionoperatingeffectively
withinacharity istoo muchfor the beneficiariestobear. Andof course inthe longrunit isthey
that have to bearthe costwhenprogrammeshave tocome to an abruptand dramaticend.
3.1.3 Governance Reviews
 In fairness, ActionAidhasalwaysbeenproactive aboutgovernance,andcarriesoutregular
reviews sothere wasn’tanyresistance tothe requestImade onarrival!So,our last review was
carriedout inFebruary2015 and the Board agreedhow we wouldtake itforwardat its March
meeting.Justafewmonthslaterthe KidsCompanystorybroke.
 There are plentyof people outthere whocancome inand lookat your governance and tell you
where the problemsare:we hadtwopeople fromCassCentre forCharityEffectivenesswho
produceda thoroughanduseful report,andthe cost wasreasonable.
 Thankfullytheydidn’tfindanygovernance gremlinsinourcloset,buttheyidentifieda number
of areaswhere improvementscouldbe made.
What didthe reviewconsist of?
 As part of the review Cassbenchmarkedus againsttheir2012 report Delivering Charity
Effectiveness:Insightsfromtheboardsof largercharities.It was effectivelyagap analysis–
where doour practicesdifferfromthose of othercharities?
 But as has beensaidcomparisonscanbe odious: governance needstobe bespoke to the
individualcharityanda largercharityis rightlyexpectedtodomore than a smallercharity.
 Howeveritwasa relativelystraight-forwardwaytodiscoverwhetheranythingwe’re doingis
patently wrong,andI thinksmallercharitieswhichcan’tjustifyhiringconsultantscoulddoalot
of thisthemselves.
 Whenyoucarry out a reviewyouneedtobe clearfromthe start about how you’ll take it
forward.If you have a governance committeealreadyinplace,aswe did,thismakesiteasier,
but otherwise considercreatingatemporarypanel of Trustees,andmake sure theyhave
designatedstaff support.
How has thisimprovedtrust and confidence at ActionAid?
 Part of the problemof a governance review isthatitcan feel like it’snotmakingmuch
difference tosupportersandbeneficiaries.There certainlyaren’tchildreninMozambique
thinkinghowgreatitis thatActionAid’scommittee structure isfitforpurpose!
 Good governance shouldmake the charitymore flexiblebetterpreparedforthe slingsand
arrows of the difficulttimeswe’re all experiencing. If peopleunderstandtheirresponsibilitythey
can exercise theirdiscretionmore readily
 Good governance isalsoanaid to transparency,makingiteasierforyoursupporterstoknow
whatyou are doingwiththeirmoney.
 More to the point,itwill meanthatyour charityisnot the Tabloids’nextvictim, withall the
diversionof energythatittakestotry to deal withanddefendyourselffromsuchaccusations;
and youcan carry on doingwhatyoudo best;servingyourbeneficiaries.
 [If youhave not yetdone so I wouldencourage everyone tocarryout a review,evenif youare
froma small charity.Atworstit will give Trusteesandstaff comfortthattheyare doingthe right
thingand won’tbe the nextheadline,andatbestit mightuncoversomethingreallynastythat
youweren’taware andcan fix before it’stoolate.]

6. Role of governance inthe Federation:
 The focus ongovernance at ActionAiddoesn’tjustrelate towhatwe’re doinghere inthe UK.
Our belief inthe strengthof local governancesystemshasledustocreate these aroundthe
world.
 ActionAidwasinitiallysetusasa UK charityin the 1970s, andsince thenwe have grownto
operate in45 countriesaroundthe world.In2003 we decidedtostoprunningprogrammesfrom
the UK andto create a federal structure,ineffectaunioncomprisedof self-governingaffiliates,
one ineach country.
 The Federationis overseenbyActionAidInternational,based in Johannesburg,andwe are the
onlyinternationaldevelopmentcharitytobe headquarteredinadevelopingcountry.
 DifferentActionAidcountriesare at differentstagesoftheir development,withsome still
directlymanagedbyActionAidInternational.Howeverthe aimisthateverycountryprogresses
up the ladderfromcountryprogramme directlymanagedbyActionAidInternationaltoAssociate
and finallyAffiliate.
 Affiliates have a legal structure and governance similar to that of the UK, witha Board of
independentnon-executivedirectorsoverseeingthe workof national staff and steeringthe
strategicdirectionof the charity. [There are 19 Affiliates,of whichtenare developingcountries
includingGuatemala,NigeriaandMalawi.]
 In thiswaythe UK isjustone outof 45, anddecisionsaboutwhere aidmoneyisspentare made
by the communitiesthatbenefit.
 Thismodel does meanthere needsto be additional scrutiny of what the other Federation
membersare doing, since they’re effectivelyourpartners,andthisneedstobe even-handed
and notpatronising.Howeverknowingthat there is a board in country doing justwhat we do
here in the UK offersa great deal of assurance.
 The ActionAid International staff provide an additional level assurance,actingas the machinery
for effective oversightof the compliance mechanismforthe organisationasa whole.
 Efficiencyinone stoppolicysettingandoversight of implementation
 The UK Board doesplay a role in the governance of other Federationmembers bytakingpart
inthe reviewprocess whichseescountriesdeveloptheirowngovernance structures.
 To progressup eachstepin the ladder,towardsindependence, eachcountrymustundergopeer
review.A panel of expertscoveringareasincludingfinance andgovernance isconvenedandwill
spendat leasta weekin-countrylookingathow thingsare beingdone.Atthe endof thisthey
will produce areportidentifying strengthsandweaknessesandsettingoutwhat(if anything)
shouldbe done toimprove. Thuswe protectthe brand.
 It wouldbe good for the sector if charitiesin the UK could do somethingsimilarfor each other:
a peer reviewtoprotect the industry.
4. Conclusion
Boards needto stand up and be countedabout governance.
 Questionmanagement
 Carry out reviews
 Don’tbe worriedaboutquestioning oldpractices
 Don’tworry aboutshiftingthe oldguard. It’sno personal reflectiononthem.Lawsand
expectationschange.
 Recognise brandandreputationasan asset

7.  Educate your donorsaboutthe benefitsof spendingtime andmoneyprotectingall the assets
I want to be a governance evangelistto you all, as important as the brand ActionAidisto the
Federation,soshould the term Charity be to the Industry: somethingvaluable;and asset to be
protected!
Let’s operate as a charitable Federationhere inthe UK – sharing best practice and reviewingeach
other.
Three proposals:
1. Our governance people shouldbe meetinginformallyeverysooftentodiscusssector
developments,share bestpractice,andhelpeachother – we couldhostthe firstmeetingat
ActionAid.
The ActionAidGovernance Coordinator wouldlove tohearfromyourgovernance person.In
manycharitiesthatwill be the PA to the CEO, , so whetherthey’re atechnical specialistornot
we want to hearfromthem.
2. Shouldwe be clubbingtogetherto review each other,asActionAidFederationmembersdo?
Surrenderingastaff member’stime foraweekisnot feasible,butwhatif itwas a day,possible a
day anda half allowingfortime toreadrelevantdocumentsinadvance?Thatwouldbe feasible
for mostof us.I alsothinkthat the act of carrying outthe review will givethe reviewerpause for
thoughtaboutwhat theyare doing,so I don’tthinkitwouldjustbe the charitythat is reviewed
whichbenefits.
3. Learn lessons:There’sa tendencytoscapegoatwhencharitiesgodown,withnoproperreview
aimedat learninglessonsfromit.The Commissionmaycarry out an investigationwherethere’s
evidence of malfeasance butthisiscloselytiedupwithitsstatutorypowerstoregulate charities.
What we,the sector,reallyneedisareview aimedatlearninglessons.Theysayyoushouldlearn
fromyour mistakes,butwhatI’dpreferisthat we all learnfromotherpeople’smistakes! When
thingsgo wrongthat learningshouldbe captured,perhapsasa case studyor similar.The NCVO
mightbe in a goodpositiontodo this,perhapswithasmall subscriptionfromcharitiestopayfor
it.
Thank youagainfor havingme;I’ll nowtake questionsandcommentsfromthe floor.Idon’tjust
wantto answeryour questions –I’dreallylike tohearfromyouwhat youthinkaboutthe three
proposalsI’ve made – isthere appetite forusto move forwardwithone ormore of them?