Frances Godden of our Charities and Ecclesiastical teams, takes a look at the Charity Commission’s refreshed guidance for trustees managing faith-based charities.

The Charity Commission has recently published refreshed guidance aimed specifically at charities established to advance religion. The new content, called Managing faith charities as trustees, replaces the previous ‘Faith in good governance’ guidance, and will be of relevance to faith-based charities whose main focus is religious worship and related activities.

This update will be welcome for many faith-based organisations, as they deal with the ongoing impact of Brexit (in particular relating to volunteers and employees) and the pandemic (which has had a catastrophic effect on such charities’ income streams and ability to undertake usual activities including worship and missional outreach), alongside the ongoing high profile investigations into safeguarding concerns for religious groups.

The guidance sets out advice in dealing with key current issues for faith charities and places of worship, including safeguarding and financial management. It highlights the core areas for legal compliance, and provides signposts to how such organisations can achieve best practice in good governance.

The content is comprehensive, and covers the following:

• Registration with the Charity Commission
  • When this is appropriate, and/ or necessary, and how to go about this
  • Benefits of registration
     

• The legal structures of charities
  • Unincorporated (trusts, associations)
  • Incorporated (charitable companies and charitable incorporated organisations (CIOs))
  • Converting from an unincorporated to incorporated structure
  • Holding trustees for land including the Official Custodian for Charities
     

• Being a trustee of a faith-based charity
  • Identifying who these are and making appointments
  • Managing disputes and disagreements
  • Legal duties of trustees
  • Induction of new trustees
  • Religious or spiritual leaders as trustees
     

• Conflicts and benefits
  • Managing conflicts of interest
  • Paying trustees who are also charity employees for services
     

• Ongoing obligations
  • Reporting serious incidents
  • Other regulatory requirements
     

• Safeguarding – working with children and adults at risk
  • Particular safeguarding risks for faith charities
  • Signposts to organisations able to give further advice
  • Handling and reporting incidents and concerns
  • Checks on trustees, staff and volunteers
     

• Managing charity finances
  • Internal financial controls
  • Cash collections and electronic payments and banking
  • Checking bank statements (‘reconciling’)
  • Protecting against fraud
  • Sending money internationally (including overseas donations)
  • Annual returns and accounts
  • Paying trustees for services
     

• Other issues to consider
  • Controversial invited external speakers
  • Employing people (including those from outside the UK)
  • Health and safety
  • GDPR and data protection

Birketts is one of the country’s leading practices in ecclesiastical law, and, together with our experienced charities team, is extremely well-placed to advise any person or body thinking of setting up a religious charity, or wishing to discuss governance and management matters relating to existing charities with faith-based purposes. We also have a strong charity property team, well-versed in the specific issues pertaining to churches and other religious buildings.

If you would like to discuss any of the issues highlighted in this article further, please feel free to get in touch with Frances or another member of the Charities Team or Ecclesiastical Team.