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NCVO Trustee Conference 2012: All presentations


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All presentations from the NCVO Trustee Conference 2012.

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NCVO Trustee Conference 2012: All presentations

  1. 1. NCVO TrusteeConference 2012in association with BWB#Tconf12 Good Governance and Leadership
  2. 2. WelcomeMartyn Lewis CBEChair, NCVO Welcome Twitter: #Tconf12 #Tconf12
  3. 3. Sponsor‟s AddressPeter Knapton WelcomeDirector of CharitiesM&G Investments #Tconf12
  4. 4. Stephen LloydSenior Partner, BWB #Tconf12
  5. 5. Tony Hales CBEChairCanal and River Trust Welcome #Tconf12
  6. 6. Tom Rolt Robert Aickman
  7. 7. Adversity Advantage• Cuts in funding• Property Asset grab• Rotating Ministers• No consistency
  8. 8. Aims• Consistent Objectives• Consistent funding• Governance by Stakeholders• Devolution of power
  9. 9. May 2009
  10. 10. Engage and Seek Advice1. Cross Party Support2. Charity and 3rd Sector Advice/support3. Stakeholder bodies – BWAF/IWA* involved – boaters ramblers, fishers etc4. Professional Advice – finance, legal, charity5. Charity Commission6. Employees and reps ( jobs , terms) *(Chair attended Board meetings as observer)
  11. 11. SMASH AND GRAB – Autumn 2009Independently verified recordAn exciting vision for government andpeople200 Riparian MP’s (stakeholder lobby)Senior Government backbenchersDEFRA AND Treasury MinistersLabour Manifesto
  12. 12. 2010 ElectionBig Society
  13. 13. Working Group Defra, Treasury, Cabinet Office, BW, (BIS, Justice, Transport, DCLG)Build the case/ communicate all the time
  14. 14. Issues• Governance • Pensions• Funding • Legislation (1500AD)• Tax • Future Legislation• State Aid • Consultation Process• Scotland • Safeguards• Environment Agency • Ombudsman
  15. 15. Mid 2011Initial Trustees (5 new and 3 former)CharityCommission, Oxfam, Ramblers, EnglishHeritage, Inland Waterways Association
  16. 16. TrusteesObservers at all Board MeetingsShadow Board CommitteesTask Groups –Income, Expenditure, Governance, Voluntary ResourceObjectives, Governance, Contract (FinancialModel)
  17. 17. ContractHow long?How much?Inflation?What conditions?Last resort position?Pensions?
  18. 18. Council TRUSTEES Waterway PartnershipsAdvisory Groups Management
  19. 19. CouncilInitially 7 elected – Boating Community Employees13 selected – Regional Chairs12 appointed – Stakeholder Associations e.g. AnglersPlus 3 selected to add diversityPlus up to 15 for new navigations e.g. EnvironmentAgency
  20. 20. Contract1. Initial offer - £390m – 10 years2. Agreed objectives for system3. Recognition of this CSR period4. Final agreement - £800m – 15 years with reasonable inflation cover and £125m last resort pension underpin
  21. 21. Contract Safeguards1. Waterway infrastructure – cannot dispose without Secretary of State approval2. Property dowry – maintain capital and invest in line with agreed strategy • Joint appointed PROTECTOR3. Must maintain Major Assets “ “ Towpath Access “ “ Flood Assets
  22. 22. Other1. Research and agree name and branding2. Negotiate a separation of assets with Scotland – 3 Wise Men!3. Negotiate with Pension Fund Trustees including Property Partnership (Scottish Law) and ultimate Government Guarantee.4. Recruit a Patron – HRH the Prince of Wales5. Merge the Waterways Trust - museums
  23. 23. Legislation1. Public Bodies Bill – December 2011 (Henry VIII)2. All Parliamentary Waterways Group and Minister published Order on 29th February 20123. Westminster Scrutiny • EFRA Select Committee • Lords • All Parliamentary Waterways Group4. Scottish Parliament and Welsh Assembly approval5. Westminster approves without division 26th June 20126. Order signed July 1st 20127. Canal and River Trust and Scottish Canals assume British Waterways responsibility July 2nd.
  24. 24. Canal & River Trust• 2,000 miles of canal and rivers• 72 reservoirs• 4 ports• 3,112 bridges• 650 embankments• 2,727 heritage structures• 65 Special Scientific Interest sites and• 35,000 boats• 11 million visitors• 38,862 volunteer days
  25. 25. The Future1. Waterways are at the heart of what we do.2. Navigation and towpath access is essential.3. Successful social enterprise – entrepreneurial and efficient.4. Attract new resources – volunteers and income.5. Utilise waterways to engage and involve communities and stakeholders to REAL OWNERSHIP.
  26. 26. The Future1. Environment sites and corridors2. Heritage – sense of place3. Education – schools to skills4. Restorative Justice5. Health – walking to white water6. Economic stimulus7. Arts – galleries to lock gates
  27. 27. The Past• Historical Heroes• Low numbers• Low skill (litter)• Employee resistance (job threats)• Health and safety barriers• Management effort!
  28. 28. Action• Leadership• Structure – policy and procedures• Low hanging fruit – confidence• Licenced groups (Health and Safety)• Invested in volunteer leaders – 27• Measure – ThankQ – Board KPI• Celebrate Success• Recognition and Reward• Brian Blessed!
  29. 29. Volunteer Days - £3m Volunteer Days40,00035,00030,00025,00020,000 Volunteer Days15,00010,000 5,000 0 2007/8 2008/9 2009/10 2010/11 2011/12
  30. 30. Virtuous Circle Better WaterwaysVoluntary Wider Usesupport New Community Engagement
  31. 31. Tony Hales CBEChairCanal and River Trust Welcome #Tconf12
  32. 32. AM1: Innovation – whatshould you be doingabout it? Katherine William-Powlett
  33. 33. A new idea that works• ‘To us innovation means coming up with new ways of doing things which are infinitely more interesting, engaging, encompassing, flexible: right now everybody has got to be as flexible as they can’• ‘To be an innovative organisation, everyone within it has to be part of the process’
  34. 34. External drivers of innovation
  35. 35. Internal drivers of innovation
  36. 36. I am happy to take part and I am1. Trustee 33% 33% 33%2. CEO3. Other O e er te CE h us Ot Tr
  37. 37. Innovation is important to my organisation 50% 50%Innovation is1. Important2. Not important t nt n ta rta r po po Im im t No Innovation
  38. 38. What drives innovation in yourorganisation?Do you think your organisationis innovative? your neighbour Discuss with
  39. 39. My organisation is innovative 50% 50%1. Innovative2. Not innovative ive ive t t va va no no In in t No
  40. 40. Set the SceneStimulate Stretch & Strengthen Ideas Step Back
  41. 41. Set the scene Board Partnership Diversity/Culture with CEO Involvement Turnover
  42. 42. Board Culture• Our board is very respectful of contributions: if it wasn’t it just wouldn’t get out of the blocks’• ‘We have free space on an agenda to think creatively about ideas’• ‘It bounces backwards and forwards. So we might start something at the board and say let’s push something to a subcommittee for a bit more then it comes back with renewed confidence or may be a few new ideas added onto it’
  43. 43. We set time aside on our agenda for new ideas 50% 50%1. Time set aside2. No time allotted e . t.. sid ot a all et es e t im m Ti No
  44. 44. My organisation is innovative? 50% Innovative 50% 50%Not innovat... 50% Time set aside No time allotted
  45. 45. Partnership with CEO• ‘If we are taking a lead from the CEO then that’s a dangerous position to be in’• ‘It is a disaster when the Chair and CEO don’t get on : a disaster’• ‘I think it is about taking hierarchy out of it and saying we are not two levels of people- we are all people who care – we just do very different roles’• ‘It is very much a question of having faith in the staff’• ‘If we want to encourage debate, conversations, dialogue resulting in innovation, we have to have well prepared papers in order to facilitate that’
  46. 46. Involvement• ‘You cannot make strategic decisions without understanding what the organisation is about...’• ‘You have to have innovation in a context so you do need to have clarity of vision’• ‘If we have a vision we can all coalesce around and we know who we are and what our values are then we can innovate’• ‘Sometimes you roll up your sleeves for the thing that you can offer and bringing your whole person into the board’
  47. 47. Diversity and Turnover• ‘Diversity is what makes us as an organisation fantastic and at board level it is great’• ‘Things are hard to change when you have a cadre of the old guard’• ‘All you need to do is throw someone different into that mix and then you start your debates’• ‘Good decisions are made by taking a bit from everybody’s expertise, experience or knowledge.’
  48. 48. The crucial role played by diversityHow diverse is your board?
  49. 49. Our board is diverse inbackground, experience, skills and personalities50% 50%1. Diverse2. Not diverse se se r r ve ve Di di t No
  50. 50. My organisation is innovative 50% Innovative 50% 50%Not innovat... 50% Diverse Not diverse
  51. 51. Set the Scene
  52. 52. Set the SceneStimulate Stretch & Strengthen Ideas Step Back
  53. 53. Stimulate External Bottom up Visionenvironment
  54. 54. Stimulate• ‘They bring really good info to the table sometimes: they are a little bit like invisible antennae’• ‘We are starting to become a user led organisation and that means letting go of a lot of power and really listening to and engaging with people’• ‘How much better does it get in terms of an organisation setting their vision- your members want to get their picture taken under it!’
  55. 55. Vision stimulating innovation
  56. 56. We have an ambitious vision that stretches us to do betterVision is 50% 50%1. Stretching2. Un-stretching Vision ng g n hi hi tc tc re re st St - Un
  57. 57. My organisation is innovative 50% Innovative 50% 50%Not innovat... 50% Vision Stretching Un-stretching
  58. 58. Stretch & Strengthen SupportChallenge Debate with Skills
  59. 59. Some grit in the Oyster
  60. 60. Stretch through Challenge‘The innovation comes from the stretch and them pushing for the stretch and saying, we want something different now, or we want something more’‘If she lets me off the hook on things I worry’ ‘It is almost like turkeys asking for Christmas isn’t it, for me to be saying I want more challenge and more dissent but actually I think it would be healthier... as long as I can control it!!’
  61. 61. Strengthen through debate• ‘We want to generate more disagreement and more conflict on the board to get a better spread of opinions’• ‘A board, in order to promote an environment of innovation, need to go into a room knowing that they are going to do more listening that talking’
  62. 62. As a board we debate well 50% 50%1. Debate-good2. Debate-poor r d o o po go e- e- t t ba ba De De
  63. 63. My organisation is innovative 50% Innovative 50% 50%Not innovat... 50% Debate-good Debate-poor
  64. 64. Set the SceneStimulate Stretch & Strengthen Ideas Step Back
  65. 65. Step backAllow Hold to Trust risk account
  66. 66. Stepping back• ‘I think also one should not underestimate the kind of tacit support from the board that just let us get on with it’• ‘There is a world of difference between looking at risk assessing it and deciding whether you are comfortable with that degree of risk or not, and just being plain crazy’• ‘Don’t get in the way too much! You need to allow things to flourish and yet not be to far away’
  67. 67. We are risk averse1. Risk averse 50% 50%2. Risk accepting e g rs t in ve ep a cc sk a Ri sk Ri
  68. 68. My organisation is innovative 50% e iv 50% at v no In 50% ... at 50% ov nn tiNo Risk averse Risk accepting
  69. 69. What does not help
  70. 70. What can trustees do to encourage innovation? Set the Stimulate, Stretch Step scene & Strengthen ideas Back Develop Under- Look for Be Engage Ensure ideas passion- inAttend strong Be stand Provide Support involved diversity from ate intellig- Accept Hold to to partner- & external informed with risk Trust accountculture ship with enough environ- bottom about challenge ent skills CEO turnover ment up vision debate
  71. 71. Questions?
  72. 72. ‘We are faced with tough sets ofcircumstances with no obvioussolution and the only way we canmove forward is by trying thingsout’
  73. 73. AM2: The strategicimportance of remainingtrue to your values Donald Ritchie, Senior Consultant NCVO
  74. 74. In today’s workshop• What do we mean by ‘values’?• The value of living our values• 3 ways that values really work for organisations• What role can Trustees play?
  75. 75. About values• Values are probably the highest level strategic decision that an organisation takes• Done well … they can define who you are, what you do and why you do it – The beginning: what inspires you – your reason to exist – The means: what you do and how you do it – The end: what you seek to achieve – your ultimate impact• Values are there for the very long term – the language that expresses them may change, but rarely the meaning
  76. 76. About valuesValues are typically expressed in two main ways:• Your beliefs about the world, in relation to your field of work – both what’s wrong with it and what it should be like• The principles that drive your work – about what you do, and perhaps more importantly, about how you do it
  77. 77. Benefits of clear valuesOrganisations that have genuine shared values achieve more• Leadership, strategy and action are more closely aligned• Working relationships are more productive• People understand when to act on their own or with othersResearch finding: companies with strong cultures that arefounded on shared values outperformed their competitors: - Revenue grew four times faster - Jobs were created seven times faster - Share prices grew twelve times faster - Profits were 750% higher - JP Kotter & LJ Heskett, Corporate Culture and Performance, 1992
  78. 78. Values in today’s contextValues-driven organisations stand a better chance of thrivingin these straitened times, by being better placed to:• Maximise their impact• Maximise their income• Minimise the risk of drifting off mission
  79. 79. How good are your values?Seeing is believing … key challenges are:• Understanding what values mean, a communication issue• Seeing values enacted in day-to-day activitiesEmpowerment is at the heart of the way that we work. In allthings we:• act with integrity• embrace democracy• aspire to excellence and• promote equality
  80. 80. Our vision, values and goals We believe in people It all starts with one simple fact: all human lives are of equal value and full of potential. Experience tells us with the right support and training, people can work their own way out of poverty. Easy guide to Oxfam The impact of our work We work better together Collaboration is at the heart of everything we do. Oxfam partners with organisations who have unique local expertise, connections and experience. Doing so not only saves us time and money, but also helps foster trust and respect in the communities we support. And through working together, infrastructures are established that will keep doing good work when the communities we work with are ready to go it alone. About our partners We say it like it is There are some people who never know when to keep quiet. Fortunately, quite a lot of them campaign with Oxfam! Whenever an issue is blatantly unfair, or secretly shoved under the carpet, we can rely on thousands of people who come together to demand - and get - results. Campaign with us Join the GROW movement
  81. 81. Living your valuesAn exercise in pairs:Choose one of your organisation’s values, and think about:• An example of how that value is embodied in the work of your organisation• What an outsider would make of your organisation without being told that valueShare your thoughts with your partnerYou’ve got a couple of minutes each …
  82. 82. Three ways that values can really work for your organisation
  83. 83. 1. Stand out from the crowdValues define who you are, what makes you tick• That’s your beliefs and how you approach your work• These set out what’s different, special and maybe unique about your organisation• Then people outside your organisation can understand you – for example funders and people you want to influence• Clear and meaningful values should get an ‘aha’ response, … and not a ‘so what?’ How well does your organisation communicate its values?
  84. 84. 2. Act together as oneValues are at the heart of peak performing organisations• Everyone understands your values and what they mean – that’s staff, Trustees, volunteers, etc• People also share the values, quite likely that’s why they’ve chosen to be involved in the organisation• The organisation lives and breathes its values – they drive decisions and activities, and are visible throughout its work If 10 people in your organisation were asked to talk about its values, what would they say?
  85. 85. 2. Act together as oneSome quotes from a recent survey of UK charities:Keep it genuine – values are not a marketing gimmickDo not think of them as just a list to publish – embed them ineverything you do from meeting agendas to policy templatesLive them or lose themPut ‘have we lived up to our values this month’ on the agenda
  86. 86. 3. Reach out to othersClear and meaningful values are a like a magnet• Where your organisation’s values are aligned with people’s personal values, those people are likely to engage with you – so values can build your financial support and activism• Values are central to effective partnerships, alliances and movements• Meeting people where they’re at is key to success, this is not a one-way exchange How do values feature in your organisation’s outreach?
  87. 87. Avoid meddling with valuesIf your organisation doesn’t have a set of values, or if they’renot clear or meaningful enough, then beware …• Values are deep-seated and personal• In organisations where there aren’t shared values, people often assume their own values are at its heart• Perceived changes to values are essentially changes to the organisational culture Don’t jump in – a robust and inclusive approach is advisable, in order that any new values actually stick
  88. 88. Values: the role of Trustees
  89. 89. Good GovernanceValues run through the Code, for example Boards:• Safeguard the vision and values of the organisation• Ensure that the organisation’s values and ethos are enshrined in its polices and practices• Ensure that any statement made on behalf of the organisation is consistent with its vision, mission and valuesMore broadly, Trustees are effectively values guardians: – You’re typically around longer, providing continuity – You can stand above the many external pressures to change – You act in the long-term interests of the organisation
  90. 90. Good governanceAnother exercise in your pairs:If the Board is the guardian of an organisation’s values, thenwhat should it do to fulfil that role?We’re looking for specific ideas and suggestions, and indeedany good practice you can shareDiscuss with your partner
  91. 91. Want to know more?Living Values – a pocket guide for trustees: practice what we preach – Cass research thought piece: Cause – research and resources about public values:
  92. 92. Thanks … and do stay in touch Donald Ritchie donald.ritchie 020 7520 2508
  93. 93. AM3: Employmentlaw for trustees Vicky Cook BWB Associate
  94. 94. Overview Handling restructures and redundancies Handling appeals
  95. 95. Restructuring Will restructuring result in redundancy? No redundancy if restructure involves a redistribution of the same work amongst employees whose numbers remain the same
  96. 96. Restructuring cont … Depends on number of factors:  reasons for restructuring (hours, pay, new role)  flexibility of job description  is it a change to the work or to how the work is performed?
  97. 97. Imposing changes to terms and conditionsas part of a reorganisation Consent Consultation Business necessity/sound good business reason Not necessary that business will come to a standstill
  98. 98. Dismissal in order to implement areorganisation Employer must demonstrate that it has discernible advantage Interest of employees cannot be ignored where there is a sound and good business reason for a dismissal Has employee acted reasonably in refusing the change? Reason for dismissal – SOSR? No redundancy pay Appeal
  99. 99. Redundancy Disappearing work Disappearing job or workplace Business requirements for work of a particular kind have ceased or diminished Can be temporary change
  100. 100. Avoiding redundancy Voluntary redundancy Job share Reduced hours Pay freeze Career breaks Secondments Talk to staff Be creative
  101. 101. Redundancy Process Individual consultation on draft proposal Confirmation of proposal At risk meeting Selection process Formal meeting to discuss redundancy and outcome Alternative employment Notice Appeal
  102. 102. Collective consultation 20 99 employees within 90 days = 30 days‟ consultation 100 + employees within 90 days = 90 days‟ consultation Consultation = with employee representativesN.B. notification to BIS
  103. 103. Selection Selection for redundancy, (not for alternative employment) Two main issues:  selection pool  selection criteria
  104. 104. Pool Is there an agreed procedure? Type of work similar? Interchangeable skills Apply mind, but good deal of flexibility Band of reasonable responses
  105. 105. Selection Criteria Consult on criteria Objective and consistent Commonly used criteria:  last in/first out?  skills and knowledge  attendance  disciplinary records Selecting out v. selecting in
  106. 106. Selection Process Individual or panel Interview or presentation Scores:  individual has right to know scores  details of scores should be provided before meeting to allow consideration and appeal
  107. 107. Alternative Employment Employer must take reasonable steps to find alternative employment for employees who may be otherwise dismissed by way of redundancy Selecting for alternatives is not the same as selection for redundancy
  108. 108. Suitable alternative employment Who determines suitability? Offer? What if refused? Trial period and pitfalls Offer of part time work
  109. 109. AppealsPurpose of AppealsEnsuring Fair process/natural justice Requirement of ACAS Code
  110. 110. What is an Appeal? Re-Hearing? Review? Not an opportunity to increase sanction!
  111. 111. What is an Appeal? cont …To: Clarify reason for dismissal Rectify previous procedural errors? New evidence? Is prior investigation required?
  112. 112. Who should attend? Chair of Appeal - more senior employee/ Trustee Panel? In person or in writing? Original decision-maker? Witnesses?
  113. 113. ACAS Guide on Appeals Applies to both grievance and disciplinary appeals Timescale – no unreasonable delay Employees should put grounds of appeal in writing Decided by manager not previously involved (wherever possible) Informed of outcome as soon as possible
  114. 114. Consequences of failure to follow appeal Unfair dismissal? Breach of contract Breach of ACAS Code/Uplift Statutory requirements i.e. flexible working
  115. 115. Appeals within the redundancy process What is the employee entitled to appeal?  The business decision?  The conduct of consultation?  Choice of employees in the pool?  The selection criteria/scoring?  Failure to consider/offer SAE?  Other unfair aspects of the process?
  116. 116. Appeals within the redundancy processcont … Timing of the appeal  Is there a realistic possibility of the redundancy being overturned?  Position of others at risk?
  117. 117. The appeal outcome Deal with each point Use headings Reason for conclusions State what new evidence considered (if any) Deal with any new grounds raised at the hearing (between new evidence and concessions) Make concessions if appropriate
  118. 118. The appeal outcome cont … Do end it appropriately Do not say employee can pursue this matter in the Employment Tribunal! Go ahead with the appeal (if requested) even if the employee has already lodged a Tribunal claim Think how the outcome letter would sound if read out in a Tribunal!
  119. 119. Vicky CookAssociate SolicitorEmployment DepartmentBates Wells & Braithwaite London LLP2-6 Cannon StreetLondon EC4M 6YH: 020 7551 7856E-mail:
  120. 120. AM4: Practical financialmanagement for trustees • Ian Mathieson, Head of Charities, PKF • Vivien Ma, Audit Manager, PKF • Richard Macey, Associate Director – Charities, M&G
  121. 121. Practical financial management for trustees – adapting to survive Insert client logo here (or delete box) Ian Mathieson, Head of Charities, PKF Vivien Ma, Audit Manager, PKF Richard Macey, Associate Director – Charities, M& © PKF (UK) LLP
  122. 122. Introduction • Current financial, operational and investment trends affecting the sector • How some charities are responding • Good financial management indicators for trustees • Investment matters • What should trustees have on their radar? • Some key messages • © PKF (UK) LLP
  123. 123. Some wise advice “It is not the strongest of species that survives, nor the most intelligent, but the one that is most responsive to change.” Charles © PKF (UK) LLP
  124. 124. And some more… “The problem with the future is that it is different. If you are unable to think differently, the future will always arrive as a surprise.” Professor Gary © PKF (UK) LLP
  125. 125. What threatens your charity’s survival? © PKF (UK) LLP
  126. 126. Risks faced by charities • Income • Safety • Public policy • Competition • Reputation • Partner/supplier failure • Staffing • Quality/compliance • Lack of credit • Cost increase • IT/data/technology • © PKF (UK) LLP
  127. 127. Income is the biggest worry Graph 7: Top three risk areas cited (those with at least 1% as highest risk) © PKF (UK) LLP
  128. 128. Stakeholders demand more Graph 26: Increased stake holder demand for performance information % of charities © PKF (UK) LLP
  129. 129. Public policy is hurting many Graph 8: Impact of public policy for those with more than 20 respondents only % of charities © PKF (UK) LLP
  130. 130. Also worth noting….. • 44% of charities intended to utilise reserves over next two years • Demand for efficiency savings and different payment mechanisms • Cash constraints on unrestricted funds (potential breach of trust issues) • Management teams are stretched • Fraud is on the increase • Pension deficits are getting © PKF (UK) LLP
  131. 131. Charities are responding by: • Income generation – Diversifying income streams – More trading income – Investment strategies • Reducing costs – Reviewing cost structures – Working with © PKF (UK) LLP
  132. 132. Charities are responding by… (continued) • Creating new ways to deliver services – Refining beneficiary group – Moving towards social enterprise – Change, innovation and focus • Better financial management – Cash flow forecast – Scenario planning – Internal controls – Reserves © PKF (UK) LLP
  133. 133. Income generation • Fundraising strategies – Trading – merchandising, sales of donated goods, social enterprises – Public donations – major donors, fundraising events • Extending services from UK to overseas markets • Thinking creatively about using available assets – renting spare space, creating consultancy income and so on • Trading subsidiary? • Tax planning • Investment © PKF (UK) LLP
  134. 134. Working in partnership with others • 59% of charities have externalised some areas of activities in the last two years • Models used include outsourcing, partnerships and shared services • Major drivers are improved quality, access to skills, reduced cost and joining up service provision • Only 50% of charities were happy that the arrangement had delivered the expected benefit • 20% did not know whether the arrangement was delivered the expected benefit or not (!) • Remember – working with others brings its own risks! © PKF (UK) LLP
  135. 135. New ways of service delivery • Social enterprise as a route to scaling up and financial sustainability • Joint venture with commercial organisations to fulfill charitable purpose • Moving to a commercial model for a previously public funded © PKF (UK) LLP
  136. 136. Good financial management indicators for trustees? • Cashflow • Going concern • Scenario planning • Internal controls – fraud risk factors • Reserves policies • Signs of operational stretch • Changing © PKF (UK) LLP
  137. 137. Cashflow • Organisations fail through lack of cash, not lack of operating surplus / reserves • Also need to be aware of the unrestricted / restricted cash split • What information are your trustees receiving on cashflow? – How regularly? – Period covered? – Are the key variables and cashflow risks clear? – Cashflow management processes? • All organisations need a closer control over cash in difficult times; ensure these basic processes are in place and under control in your © PKF (UK) LLP
  138. 138. Going concern issues • Auditors looking very carefully at the robustness of going concern assumptions, operational plans and supporting evidence (at audit planning and completion) • Under auditing standards – duty lies first with the trustees to satisfy themselves over the going concern basis • One year from the date of signing the accounts, not the year end • Cashflow is key – minimum of 12 months from signing split across restricted and unrestricted funds • Potential for trustees to be in breach of trust where using restricted funds for unrestricted purposes. Review your net asset funds note • Have you seen all the evidence you need? Letter of Representation – are your senior management team happy for you to sign it? © PKF (UK) LLP
  139. 139. Scenario planning • Questions for trustees: – What scenario planning has taken place in your organisation? – Who was involved? – How often is it renewed? – Balance of external / internal information used? – Conservative / wild and whacky scenarios? – Is it clear what action needs to be taken and when in each case? – How will you know which scenario is panning out and therefore when actions need to be triggered? © PKF (UK) LLP
  140. 140. Internal controls – fraud risk factors Risk of fraud is heightened in times of economic downturn: • Controls over company credit cards • Expenses policy – self certification at the top? • Access to internet banking and controls over payments (including payroll) • Duplicate payments & dummy invoices • Fraudulent changes to supplier details (and collusion) • Controls over access to systems by leavers (watch your security over data) Many frauds are not complicated; they are perpetrated at a basic transactional level and can be guarded against by good controls and by all staff being alert for the signs of a potential fraud • And the typical fraudster is? © PKF (UK) LLP
  141. 141. Fraud risk • Questions for trustees: – Do you have a clear strategy in place to reduce fraud within your organisation? – Do you measure and monitor the risk and the cost of fraud in some way? – Is there a clear counter fraud culture in place within the organisation? – Is there a clear whistle blowing policy in place? – Are firm, rapid actions taken if fraud is discovered? – Is detection and prevention of fraud built into controls, systems and processes? – Do fraud issues get discussed at board level? – Do you periodically assess the effectiveness of your approach to fraud? © PKF (UK) LLP
  142. 142. Reserves policy • Why do charities hold reserves? – to fund working capital – to fund unexpected expenditure, for example when projects overrun or unplanned events occur – to fund shortfalls in income, when income does not reach expected levels • Current reserves level – what are your free reserves? – Exclude those that cannot be turned into cash quickly e.g. fixed assets – Exclude restricted funds • What reserves does your charity need i.e. what are your charity‟s rainy days? © PKF (UK) LLP
  143. 143. Reserves policy (continued) Questions for trustees: • When did you last revisit your reserves policy? • Does it remain appropriate to your charity‟s changing needs? • Is it clear how you plan to manage any gap between current reserves levels and reserves targets? • How often do reserves levels get discussed at trustee meetings? • Are the links to the risk register and your strategic direction clear and well understood? • Have a good look at your restricted funds – can you use them better whilst complying with their terms and conditions? © PKF (UK) LLP
  144. 144. Signs of operational stretch • Change management + keeping the show on the road = potential operational stretch • Your senior management team are key; they need to be supported and challenged – balance is important • How can you address operational overstretch? – Just do the important stuff – Postpone less important things – Do things differently – Get more resources – Use trustees & volunteer skills and commitment • Watch out for the warning signs • Discussions with © PKF (UK) LLP
  145. 145. Changing Risks • Questions for trustees: – When did you last see your risk register? – Does it reflect the key risks the organisation now faces? – Is it clear what the key risks are, how they are being managed and how they are being monitored? – How often do trustees receive a report on organisational risk? – What actions are taken when a heightened risk is identified? – Who is scanning the horizon – is anyone looking across sectors? © PKF (UK) LLP
  146. 146. Investment © PKF (UK) LLP
  147. 147. Valuation signals, 2000 versus 2012 Sample of assets, showing real yield against an assessment of neutrality 12 Undervalued? 2000 Current Neutrality 10 8 Real yield (%) 6 4 2 0 Overvalued? -2 Investment odds are in favour of equities160 Source: M&G Investment Management Ltd. Real yield is defined as an inverted p/e ratio, using forward consensus data. As at 1 October 2012
  148. 148. Market timing – best and worst times Nobody rings a bell at the top or bottom of the share price cycle UK equities – 20 years to end February 2012 10 9 8.3 8 7 6 4.9% pa 5 4 3 2.7 2 0.9 1 0 -1 -2 -0.8 -3 Fully invested throughout Missing 10 best days Missing 20 best days Missing 30 best days Missing 40 best days Market timing increases risk – a risk that can be avoided Prices may fluctuate and you may not get back your original investment Past performance is not a guide to future performance161 Source: Datastream and M&G, in sterling, income reinvested, as at 29 February 2012.
  149. 149. Taking a long-term view….. Contribution to total returns Breakdown of total US returns (real) for every 1 year and 5 year period since 1871 100 90 80 70 60 50 % 40 30 20 10 0 1 year time horizon 5 year time horizon Dividend yield Dividend growth Change in valuations …..but you don’t have to wait a lifetime162 Source: GMO, as at August 2010
  150. 150. Why dividend investing works Dividends and share prices go hand in hand – they are not mutually exclusive! Capital growth vs. total return: US returns over 10 years to December 2011 160 141 140 120 Return (%) 100 86 80 60 40 33 20 10 0 S&P500 Capital S&P500 Total Return Dividend Achievers Dividend Achievers Return Capital Return Total Return Consistent dividend payers deliver better share-price performance …and investors receive the income on top163 Source: Mergent‟s Dividend Achievers, as at 30 November 2011; Datastream as at 31 December 2011. US companies with a 25-year track record of consecutive dividend growth
  151. 151. Key messages • Investment objectives – be clear on what you seek to achieve, and review these regularly • Keep it simple – avoid investing in products that you don‟t understand • Inflation is the real enemy; think long term – don‟t obsess about benchmarks and short-term volatility! • Income & income growth remains key – for cash and total return • Equities are more attractively valued than bonds or property – patience is a virtue • Prices will fluctuate and you may not get back your original investment164
  152. 152. Keep on your radar • Changing operational and regulatory environment – are opportunities as well as challenges (VAT, Real Time Information, auto - enrolment are good examples) • When things change – the routine can be overlooked and internal controls can weaken • Are our gift aid claims up to date? – easy money sitting there for you to reclaim • What are others doing across sector(s) – can this benefit us? • Remember there are a lot of opportunities out there for your organisation (even if not always easy to find) © PKF (UK) LLP
  153. 153. To sum up – some key messages • Ask the right questions – even if they are difficult ones • Trustees may need to challenge the sacred cows and previously accepted wisdoms from management • Take advice if you need it – use someone as a sounding board • Be aware of the risk of management stretch – remember somewhere along the line it will always impact on the finance team • Identify the “must do‟s” and get those right • Keep asking – is there a way we can use the assets and resources currently employed in a better way? © PKF (UK) LLP
  154. 154. A final thought… “If you do what you’ve always done, you’ll always get what you’ve always got.” Anthony © PKF (UK) LLP
  155. 155. Questions? © PKF (UK) LLP
  156. 156. Contact us • Ian Mathieson 020 7065 0399 • Vivien Ma 020 7065 0735 • Richard Macey 020 7548 3731 PKF (UK) LLP Farringdon Place, 20 Farringdon Road, London EC1M 3AP M&G Investments Governors House, 5 Laurence Pountney Hill, London EC4R © PKF (UK) LLP
  157. 157. AM5: The challenges faced bychairs • Dorothy Dalton, Governance magazine editor • Steve Powell, Sign Health CEO
  158. 158. The role of the chair of trustees• To provide leadership to the board and to ensure that trustees fulfil their duties and responsibilities for the proper governance of the charity.• To support and where appropriate, to constructively challenge the chief executive and to ensure that the board as a whole works in partnership with executive staff.
  159. 159. Main challenges •Processes •Behaviours
  160. 160. Complying with governing documents
  161. 161. Proper process for identifying newtrustees
  162. 162. Introducing limited terms of office
  163. 163. Agreeing the charity’s values
  164. 164. Planning the way ahead and adaptingto rapidly changing times
  165. 165. Guarding the assets
  166. 166. Effective management of risk
  167. 167. Keeping meetings business-like andeffective
  168. 168. Behaviours
  169. 169. Trustees who never read the boardpapers
  170. 170. Dominating or controlling trustee
  171. 171. Trustees unable to raise difficult orsensitive issues
  172. 172. Board at war with itself
  173. 173. The board micro-managing the chiefexecutive
  174. 174. Private meetings of the board beingmisused
  175. 175. Problems with the founder
  176. 176. Members and managing democracy
  177. 177. Dorothy Dalton 020 8426 6686 07777 660356 www.dorothydaltongovernance.comCartoons by Anthony Kelly
  178. 178. a) TO GO OR NOT TO GO?The Chief Executive has been with the charity for over12 years. In the first 5 years the charity grew inincome and activity largely due to the energy, effortsand vision of the Chief Executive. In the next 5 yearsgrowth and activity tailed off and this was explainedas ‘consolidation’ and due to market pressures.Trustees had raised their concerns at the last StrategicReview and two years on things are not gettingbetter.There are now mumblings that a change in CEO isrequired.
  179. 179. a) TO GO OR NOT TO GO? Cont……1. The CEO has the strong support of the SMT and staff2. The CEO is the recognised ‘face’ of the charity3. The CEO has a close friendship with at least two of the Trustees, going on holiday together, and their children being close friends
  180. 180. b) BANGING HEADS TOGETHER The outgoing Chair of Trustees was a kind, democratic but uninspiring leader. The Board has split into two factions, one group thinking they should merge with another charity, the other group resistant to any new ideas. Each side has a forceful spokesperson. You have discussed this problem with the CEO who isn’t convinced merger is the right move, especially given the Board’s differing views which would make negotiation with any other charity impossible. The charity is financially sound, has a good staff team but is hampered in its well respected work by the squabbling within the Board. You have been appointed from the outside as Interim Chair to try and resolve matters.
  181. 181. b) BANGING HEADS TOGETHER Cont……1. Some Trustees have been on the Board for many years2. The auditors have questioned the high costs of the monthly Board meetings which involve travel and overnight expenses3. The squabbling has now come to the attention of a funder of the Charity who is likely to withdraw unless these difficulties can be resolved
  182. 182. c) KEEPING A FIRM GRIP ON THE BOARD •The charity is led by a strong and experienced CEO. The senior management team work well together and are delivering against the organisation’s strategic objectives. The charity is financially strong, respected and has excellent internal controls • •However, one or two members of the Board seem to find every opportunity to criticise the CEO or the team. Those Board members also have conflicts of interest, which they have declared, but it still doesn’t stop them finding fault whenever possible. When challenged they answer that the Board’s role is to scrutinize the Executive. The Chief Executive is looking to you for a resolution
  183. 183. c) KEEPING A FIRM GRIP ON THE BOARDcont …. 1. The two Board members causing these problems are elected from the membership 2. The vice-chair who is responsible for the Board’s Governance is weak and ineffectual 3. The CEO has hinted that unless something is done soon he will make a formal complaint or walk
  184. 184. d) TRUSTEE NON-ATTENDANCE • We have a trustee who last attended a board meeting in 2009. However, he always sends apologies for board meetings on the grounds that he is too busy and the distance to board meetings is a problem. He lives 300 miles away • He is a property expert who has saved our charity many hundreds of thousands of pounds with his negotiating skills and his property expertise. Property matters excite him and he travels long distances whenever we need his specialist skills and he then gives unstintingly of this time. He is invaluable to the charity • A couple of years ago, the chair spoke to him gently about attendance at board meetings and he almost resigned. He indicated that it is because he is a trustee, that he gives us so much of his time on property matters.
  185. 185. d) TRUSTEE NON-ATTENDANCE Cont……1. In the next year or two the Charity will have outgrown its office space2. The Charity is a national body with projects in Scotland and N. Ireland3. Board meetings start at 10.30 am and have always been in London
  186. 186. e) RESCUE OR TAKE-OVER• For various reasons this charity has built up a substantial overdraft at the bank, secured by a charge on one of its two buildings, both of which are essential to the service provision side of its work.• Recently (and the week the new chair took up the post) the bank refused an increase in the overdraft facility and the charity was on the brink of insolvency. Suddenly out of the blue, the parent of one of the service users (a very successful business woman) has offered the charity a massive interest free loan secured by taking a charge on the charity’s second building. In addition she insists that she and another successful businessman become trustees and between them run (as chair and vice chair) the finance committee which must be given significantly increased delegated authority. She says that the two of them will transform us into a viable and thriving charitable business. Because her son is a very contented resident in one of our homes, she naturally wants the charity to flourish. Our two buildings are our only assets• However the chair is very concerned that this is a take-over in all but name and that the board of trustees and the chief executive will, in effect, be totally disempowered. Trustees seem oblivious to the risks and are eager to find any solution to the financial problems. Many of their family members are service users
  187. 187. e) RESCUE OR TAKE-OVER Cont…… 1. The Memorandum and Articles of Association haven’t been updated for some years 2. The new Chair was appointed for his skills in ‘turn round’ and fundraising 3. The Charity has had some early stage talks with another similar but larger Charity
  188. 188. f) BREACHING CONFIDENTIALITY• The chair of trustees was recently appointed having been a trustee of the charity for five years. There has been a problem of confidential information leaking from the board. This has ranged from a senior member of staff being warned that action was to be taken by the chief executive (CE) with regard to her under-performance despite support and training, to a branch of the charity being informed that the cost- saving axe was about to fall quite heavily on it when the matter was still very confidential. Anecdotal evidence points to a particular trustee• The previous chair discussed the issue with trustees when the trustee concerned was not present and during a closed session of the board (i.e. without the chief executive and senior staff). As a result the former chair raised the matter with the trustee who denied the accusation vehemently and accused the CE of deliberately trying to get him off the board because he asks too many searching questions• Things went quiet for a while but there has just been another significant disclosure of confidential information about a very sensitive issue with potential reputational risk to the charity. The evidence points to the same trustee and the board expects the new chair to take firm decisive action to stop the leaks
  189. 189. f) BREACHING CONFIDENTIALITY cont… 1. A past suggestion from the CEO that the Board review its governance and the election process wasn’t well received. 2. The accused Trustee does have some friends on the Board 3. It is likely the accused will see themselves as a whistleblower, saying they were acting in the best interests of the charity.
  190. 190. g) MAIL ON SUNDAY DISCLOSING FRAUD• The Finance Director (FD) has been at the charity for many years and has worked very successfully with four different chairs of trustees. He is highly regarded and trusted implicitly by the board, the chief executive and the rest of the staff• A bright young graduate joins the finance team as its most junior member on a salary of just £15,000. She notices some unusual payments being made to a company and decides to make some discrete enquiries. She finds that the company secretary is the FD’s brother and that the two of them are the only shareholders. She finds ten payments totaling £100,000• Not knowing who in the charity she should take her findings to, she decides to take her story and the evidence to the Mail on Sunday. The first the chair hears of the matter is when the Director of Communications phones on the Thursday to say The Mail on Sunday wants a statement before they publish on Sunday about the hundreds of thousands of that have been defrauded.
  191. 191. g) MAIL ON SUNDAY DISCLOSING FRAUD cont… 1. The CEO is currently overseas on holiday 2. The auditors have always given the charity a clean bill of health although the same auditor has been used for sometime 3. The Chair wants to avoid reputational damage, at all cost.
  192. 192. h) TRUSTEE WHO TRYS TO OVERTURN BOARD DECISIONS • Kate is a good and loyal trustee who gives to the charity in a number of different ways. She has been a regular and very loyal volunteer who is always prepared to go the extra mile. As a trustee she also uses her professional expertise to assist the charity. She does all this while managing her own business and bringing up two teenage children. She is passionate about the work of the charity which did so much to help her much loved father • At board meetings she joins discussions with enthusiasm and is very articulate but has very fixed views. When a board decision goes against her, she will just not let the matter lie. At the following meeting she will raise the issue again when the minutes of the previous meeting are considered and will try to get to the board to reverse its decision. If this doesn’t succeed, she will bend any issue being discussed so that it goes back to the decision which she wants over-turned. She just won’t let go
  193. 193. h) TRUSTEE WHO TRYS TO OVERTURN DECISIONS cont…1. Kate has a very engaging personality and is generally liked by the Board2. She has good relationships with the CEO and SMT although her stubbornness does show, and she is inclined to bring board discussions into operational matters3. The Chair (male) doesn’t know how to handle a powerful personality such as Kate and so has been ineffective
  194. 194. AM6: Three in one charityupdate – CharityCommission, legal andpensions • Christine Rigby, BWB solicitor • Nick Mott, Charity Commission Head of Policy • Mark Brown, Lucas Fettes Director
  195. 195. Charity Commission Update 2012 Nick Mott Neal Green12 November 2012
  196. 196. New vision
  197. 197. Reviews and big ideas• Lord Hodgson‟s review• NAO report and PASC review• Law Commission Review• Promotion of alternative civil society forms and funding: – mutuals – social enterprise – social investment• Perceptions of the Commission - Tribunal decisions on public benefit (and others)
  198. 198. The Money
  199. 199. Charity sector – how big? Number of charities 13,000 162,000 180,000 Registered Exepted and Small ExemptBased on Charity Commission and NAO data, 2012
  200. 200. Charity sector – how much? Income of Charities (bn) £70.0 £60.0 £58.6 £50.0 £47.0 £40.0 £30.0 £20.0 £10.0 £0.4 £0.0 Registered Excepted and Small Exempt (known)Based on Charity Commission and NAO data, 2012
  201. 201. Some big issues• Pensions• Charities and education• Charities‟ relationships with government• Funding and fundraising• Independence
  202. 202. Our latest research – how istrustee recruitment?Amongst new organisations applying to register:• 34% wanted more trustees; 26% had difficulties recruiting• trustees most commonly recruited from – existing staff, volunteers, members – personal contacts – word of mouth• Over half try to recruit trustees from different backgrounds• Over 70% try to identify and meet skills needs when recruiting• 63% offer some training and support for trustees (20% said „comprehensive‟)
  203. 203. Our latest research – how isgovernance?New organisations applying to register:• Use a variety of sources of support and advice• Mostly do not benefit trustees (only 2% pay any trustees for serving)• Mostly (over half) felt that managed risk-taking is necessary• Mostly (95%) agreed that the trustees‟ role is about governing the organisation – 51% of respondents said trustees set vision and strategy, delegating delivery to others – 22% said their trustees also manage the organisation day to day – A further 22% said their trustees more or less do everything
  204. 204. Vision
  205. 205. New strategic plan• Developing compliance & accountability• Developing self-reliance• Being effective in the way we do things
  206. 206. Developing self-reliance• Self-reliance of trustees – Improving online guidance and information for trustees – Improving online services• Self-reliance of the sector – Working with umbrella bodies – e.g. shortly re-launching quality standards accreditation programme
  207. 207. Trustee decision making• Planned guidance• To help trustees make sound decisions• To give them confidence about doing so• Reinforcing that you don‟t always need to ask the Commission• Explaining the legal principles• Informal consultation later this year
  208. 208. Developing accountability• Ensuring charities file documents online and on time• Improving online register, e.g. new advanced search functions, new top ten lists, new mobile version of the website.• Asking the sector and public – what information about charities to do you expect from regulator?
  209. 209. Accounts filing: latest figures• 86% charities filed accounts on time in 2011-12• 83% charities filed annual returns on time• 4683 charities filed accounts* more than 30 days late * charities with incomes < £25 k not required to file accounts
  210. 210. Late filing: the warning signs• Late filers tend to be repeat offenders• Not just small charities• No evidence that late filing is caused by financial problems• Correlation between poor quality accounts and late filing• More than 1/3 of defaulters had prepared and signed accounts within deadline• 39% of late filers filed on time with Companies House
  211. 211. Developing complianceEnsuring trustees comply with charity law, by:• being proactive in preventing problems occurring in the first place• taking timely action where serious problems arise• coordinating with other agencies
  212. 212. Charities Back on Track 2012Common areas of concern• Trusteeship issues/serious governance concerns (58 of 85 investigations)• Accounting issues (26 of 85)• Disputes (19 of 85)• Fraud allegations (18 of 85)• Vulnerable beneficiaries (11 of 85)
  213. 213. Charities Back on Track 20121,027 reports of serious incidents (RSIs)121 reports from whistle-blowers1,374 assessments*5,000 First contact & Operations cases**85 investigations completed9 statutory inquiries* April-December 2011 **December 2011- March 2012
  214. 214. Being effective - New risk frameworkDo we need to engage? – is issue within our remit? – is another agency better placed to respond? – could guidance resolve issue?What’s the level of risk? – e.g. challenge to integrity of charity status? – beneficiaries, assets at risk? – do trustees have capacity to resolve problem?What’s the most effective response? – only most serious cases dealt with as statutory inquiries
  215. 215. Being effective – what’s most important?• Dealing with fraud, financial crime and financial abuse• Dealing with safeguarding children and vulnerable adults issues• Counter-terrorism strategy
  216. 216. What we’re doingOur main activities are still mostly unchanged:• Online guidance• Registration• Advice and permissions• Investigation and enforcement• Supporting sector initiatives: – The Code of Governance – Trustees‟ Week• Policy research
  217. 217. What we’ve done• 5,601 new charities registered• 85 investigations (9 statutory inquiries) completed• 213,022 emails, letters and phone calls dealt with• 1,191 Freedom of Information requests• 43m page views of our website (6m views of charities‟ details)
  218. 218. Guidance• Public benefit consultation• Disaster appeals• Financial controls• Exempt charities• Research• Community Interest Companies• Charitable Incorporated Organisations
  219. 219. Research this year• Governance of organisations seeking registration• Charity governance in Wales• Charity reserves and reporting them• Public trust and confidence in charities• Impact of the public benefit requirement• Profiling charities that file late
  220. 220. It’s about charities…
  221. 221. Questions?NCVO / BWB Trustees’ Conference 2012
  222. 222. What we will cover New legislation Lord Hodgson‟s review Recent cases Charitable Incorporated Organisation Scotland and Northern Ireland
  223. 223. Charities Act 2011 Charities Acts 1993 and 2006 consolidated into Charities Act 2011 (but not 1992 Act) Came into force March 2012 No substantive change to the law – just changes to section numbers
  224. 224. Review of 2006 Act November 2011 - Lord Hodgson appointed to lead the review process Report published July 2012
  225. 225. Timescales for any changes Government expected to respond before Christmas Non-political changes – possible legislation in 2015 Political changes – in the hands of the Cabinet Office
  226. 226. Headline issues for trustees Payment of trustees – charities with income over £1m to have an automatic power to pay trustees No changes to protect trustees of unincorporated charities Recommendation that charity legislation should include a trustee‟s “right to information” Good practice “cap” on trustees serving more than three terms
  227. 227. Headline issues for charities Charging by the Charity Commission Raising the threshold for registration to £25k For larger charities, scrapping the Summary Information Return Tighter self regulation of fundraising Sector committee to progress reform of public collections
  228. 228. Recent cases Davies -v- Barnes Webster & Sons Ltd – unincorporated sports club – Chair of management committee sued personally for money owed on building contract White –v- Williams – schism in a religious charity. Some trustees held to have breached their duties - Judge refused them an indemnity out of the trust‟s assets for legal and other fees incurred during the dispute
  229. 229.  Wedgwood – were the assets of the Wedgwood Charity available to pension fund creditors? On the facts, yes. Friends of Burbage School Limited –v- Woodhams – Fundraising auction – extent to which trustee was liable for services he had arranged (and an unintended bid…)
  230. 230. The Charitable Incorporated Organisation– are we nearly there yet? Expected before the end of 2012 Phased implementation:  Initially “Brand new” charities with £5k income  March 2013 Unincorporated with income over £250k  May 2013 Unincorporated with income over £100k  July 2013 Unincorporated with income over £25k  Oct 2013 Unincorporated charities with income over £5k  Jan 2014 All new and unincorporated charities
  231. 231. Should you/shouldn‟t you?Pros: Bespoke charity vehicle Just one regulator No need to reconcile charity and company law requirementsCons: Untested – may be teething problems No register of charges may mean lenders are wary
  232. 232. Across the borders Scotland  SCIO already available in Scotland  OSCR about to review 40 fee charging schools  Possible legislation in 2013 to give separate legal personality to unincorporated associations Northern Ireland  Registration with CCNI due to commence Autumn 2013
  233. 233. Any questions? Christine Rigby Tel: 020 7551 7712 c.rigby@bwbllp.comBates Wells & Braithwaite London LLP 2-6 Cannon Street London EC4M 6YH
  234. 234. Mark BrownDirector & Head of Financial Services
  235. 235. Lucas Fettes & Partners Employee Benefit Consultants and Independent Financial PlannersAppointed to deliver pensions solution for NCVO members in April 2011
  236. 236. Contents Duties Your OrganisationOptions & Timescales Costs
  237. 237. DutiesOperate a qualifying pension scheme Auto-enrol certain workers Make contributions Provide information Compliance
  238. 238. Where to start Consider what you want to achieve Do I want to help my I merely want to meet myemployees save and plan for a OR minimum legal requirements? better retirement?
  239. 239. Timescales - Staging DatesEmployer type WhenLarge: 250+ employees 1st Oct 2012 to 1st Feb 2014Medium: 50–249 employees 1st April 2014 to 1st April 2015Small and Micro: 1-49 employees 1st August 2015 to 1st April 2017
  240. 240. Workplace Pension Options1 2 Consider Tailor Establish existing new scheme Scheme structure and scheme (e.g. GPP) governance Investment options and default fund Use Master Trust scheme Administration (e.g. NEST) Member communications 3
  241. 241. CostsMinimum contributionsEmployer Employee Tax relief Total1% 0.8% 0.2% 2% until Oct 20172% 2.4% 0.6% 5% until Oct 20183% 4% 1% 8% from Oct 2018Compliance and administrationAdvice and guidance
  242. 242. Action PlanEstablish your staging date NowProfile workforce and quantify impact 12-18 months Agree strategy and scheme design 9-12 months Review HR/Admin functions 6-9 months Test systems and processes 3-6 months Communicate and Implement 0-3 months
  243. 243. Further Information Pension Reform – A Guide for Trustees For more information or a copy of our slides please call 0845 357 8910 or email This presentation has been prepared based on our current understanding of UK taxation, Law and HMRC Practice.Lucas Fettes & Partners (Financial Services) Limited is an Independent Financial Adviser authorised and regulated by the Financial Services Authority (FSA) FSA no. 146279.
  244. 244. PM1: Next steps forvountary action Karl Wilding, NCVO
  245. 245. The Road Ahead?Planning for the Voluntary Sector OperatingEnvironment 2012-2015Karl WildingNCVO Policy & Research | November 258
  246. 246. A strategic planning cycle Getting the direction right Evaluation Strategic analysis Implementation Options and choices Planning
  247. 247. Considering implicationsWhat? = scanning the external environment to identify and prioritise the driversSo what? = considering the implications for your organisation and key stakeholders, spotting opportunities (and threats and risks)Now what? = considering the next steps your organisation might want to take: honing the opportunities down creating some strategic options making decisions about future plans
  248. 248. The PEST/PESTEL Framework Political Economic Socio-cultural Technological Environmental Legal
  249. 249. Key steps1. Map the drivers that could impact your organisation2. Sort them into the vital, the important and the interesting3. Carry out further research into the drivers that matter4. Consider the implications of these drivers and generate opportunities and options (scenarios)5. Take strategic action – make decisions about your response
  250. 250. The voluntary sector economy 263
  251. 251. The voluntary sector economy 1. Falling income, rising costs, higher expenditure to meet greater need. 2. Giving stable, but for how long? Still £900m below 2007/08 peak 3. Government contracts still increasing? Grants £2 billion less than in peak of 2003/04. 4. More trouble to come? Austerity till 2018 5. Social investment: high profile but remains niche
  252. 252. The voluntary sector economySource of income to voluntary organisations, 2000/01 to 2009/10 (£ billions) Source: NCVO/TSRC, Charity Commission
  253. 253. Plugging the deficit: Govt plans £10bn more benefit cuts Source: IFS budget2012carlemmerson.pdf
  254. 254. Voluntary sector policy environment
  255. 255. Voluntary sector policy environment 1. Government approach: „showing not telling‟, „local not national‟ 2. Changing landscape: more emphasis on frontline 4. Public services: payment by results, level playing field? 5. Focus on delivery: Localism Act; social value; Big Society Capital; mutualisation
  256. 256. Key VS policy issues 1. Public services • Social value Act 2. Localism • Right to challenge • Right to bid 3. Charity Law & regulation • Fundraising • Public benefit • Role of the charity commission 4. Funding & finance issues • Giving & taxation • Social investment
  257. 257. Social attitudes
  258. 258. Social attitudes Attitudes towards taxation and spending 2000-10 (%) (Source: British Social Attitudes Survey 29, 2012)
  259. 259. Social attitudes 1. Inequality and fairness still important narratives: but social attitudes are hardening 74% agree the income gap between rich and poor is too large 34% believe government should take steps to redistribute wealth 2. Less support for collective public services? Support for increasing taxes and spending more on health, education and social benefits has decreased from 51 % in 2000, to just 30% in 2010 3. And public support for the welfare state? 63% believed parents who "dont want to work" were a reason why some children lived in poverty 55% believe unemployment benefits are too high and that they discourage those out of work from finding new jobs Source: British Social Attitudes
  260. 260. Technological change
  261. 261. Technological change 1. Mobile devices primary device for connecting with internet for increasing number of people Smartphones are predicted to overtake standard mobile phones in 2012 Mobile app downloads will rise from 10.7bn in 2010 to 182.7bn in 2015 2. New ways to pay and give?: NFC payment, new web and mobile payment technologies, group buying, crowdfunding 3. Mainstream: social media, social analytics, cloud computing/storage 4. Rising interest in „Big Data‟ and open data 5. Social action and technology: still very much focus of innovation in our sector
  262. 262. What have I missed?