728x90_CCS_Awareness

Trustees' Week: Five top tips for managing risk on the job

Written by David Britton
13/11/17

As we head into Trustees’ Week, it’s a great chance to celebrate the incredible efforts of the people driving forward the charity sector, but also to highlight the need to protect them as crucial assets.

With many charities looking for alternative and increasingly innovative fundraising methods alongside exploring new operating models to drive efficiencies; charities, and particularly their trustees, are facing and embracing new and unprecedented levels of risk.

In this climate of transformation, trustees are likely to have more high profile or controversial decisions to make. And, with new regulation like GDPR on the horizon in 2018, which could see charities exposed to major fines in the event of data breaches, managing risks effectively becomes of even greater importance.

So how can trustees manage the operational risks they are increasingly facing as they look to mitigate financial risks in a difficult economic climate? Here are our top tips:

Keep detailed meeting notes and a proper audit trail

It may sound simple but detailed meeting notes and thorough audit trails which outline decisions, appointed persons and any delegated authority are a source of evidence should a decision be made that causes issues. Ensure these files are backed up in case of an incident.

Conduct thorough risk assessments

Charities have a duty of care to protect both their volunteers and the public from situations where they could be considered at risk due to the charity’s activities. Planning not only helps to protect all parties but will provide evidence that the risks were considered and mitigated where possible. If a liability claim were to be brought against the charity, this risk assessment can often be used as evidence to defend the case.

...especially for 'hazardous' fundraising events

When charities are getting involved in more hazardous fundraising events such as obstacle course races and extreme challenges, it is even more critical that they engage with competent third parties with experience and their own insurance in place, especially bearing in mind both the physical and reputational risks involved.

Be cautious when delegating

Be careful when delegating management or operational responsibilities. Even where there is a paid management team in place, the ultimate decision-makers are at board level. Trustees should always ensure due diligence is exercised.

Be confident when making decisions

Good overall governance is, of course, the most important factor in mitigating risk in times of change, but it’s also vital for charities to look at ways of insuring against personal liabilities so that trustees can operate effectively, sustainably and safely. Although trustee liability insurance is not a legal requirement, this cover is often considered essential by charities when seeking to recruit high-calibre trustees. Trustee liability insurance protects trustees against having to pay personally when legal claims are made against them in the capacity of their role.

Giving trustees the confidence to make big, bold decisions without being held personally accountable can be key to future-proofing their charities so that they can continue to provide the most impactful support to the people and communities they help.

David Britton is the charity director at Ecclesiastical Insurance



Related Articles


Investment Risks Update
Matt Ritchie talks to Kier Boley of GAM about the latest risks in investment and what charities should be doing to avoid them.

Most read stories...
World Markets (15 minute+ time delay)
FTSE
7,409.64
-7.60
S&P 500
2,602.42
+5.34
Nikkei 225
22,550.85
+27.70