Revised Charity Governance Code – what you need to know

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Charity Governance Code EDI revisions

The Charity Governance Code has recently been updated to include a greater emphasis on the responsibility of charities regarding equality, diversity and inclusion (EDI).

Below we outline the main changes to the code and how it may apply to charities.

What is the Charity Governance Code?

The Charity Governance Code is developed by a steering group and sets the principles and recommended practice for good charity governance. The Code draws on the guidance provided by the Charity Commission but is not a legal or regulatory requirement.

Its aim is to help charities and their trustees aspire to and develop high standards of governance:

“A charity is best placed to achieve its ambitions and aims if it has effective governance and the right leadership structures. Skilled and capable trustees will help a charity attract resources and put them to best use. Good governance enables and supports a charity’s compliance with relevant legislation and regulation. It also promotes attitudes and a culture where everything works towards fulfilling the charity’s vision.

“It is the aim of this Code to help charities and their trustees develop these high standards of governance. As a sector, we owe it to our beneficiaries, stakeholders and supporters to demonstrate exemplary leadership and governance. This Code is a practical tool to help trustees achieve this.”

To see the code in full, visit: https://www.charitygovernancecode.org/en

What are the new revisions to the Charity Governance Code?

The Code has recently been updated to add greater emphasis to the responsibility of charities regarding equality, diversity and inclusion (EDI).

The Code now includes specific EDI principles and has been written in consultation with the charity sector and with independent EDI consultant Pari Dhillon. Within the Code are now four recommended stages of practice for charities on their “EDI journey”.

Charity boards are encouraged to:

  1. Think about why equality, diversity and inclusion is important for the charity and assess the current level of understanding.
  2. Set out plans and targets tailored to the charity and its starting point.
  3. Monitor and measure how well the charity is doing.
  4. Be transparent and publish the charity’s progress.

Speaking about the EDI revisions to the code, Pari Dhillon said: “Great EDI has the power to create social justice in our boardrooms, charities, sector and ultimately society.”

She added: “EDI practice sits at the heart of good governance, and I’d argue you can’t have one without the other,” and urged boards and trustees to focus on equality of outcomes and to ensure their membership is diverse “reflecting and centring the voices of the community and needs that the charity seeks to serve.”

In a report last year, the NCVO found that BAME charity staff earn 20% less on average than non-BAME staff – a gap that has widened since the previous year.

Rosie Chapman, chair of the Charity Governance Code’s steering group, said: “These improvements to the Charity Governance Code reflect changes in society and the broader context in which charities are working.

“The updated Code is designed to help charities adopt good practice and secure better outcomes for the communities they serve.

“We know that charities are at varying stages in their efforts to fully adopt the Code, including in achieving equality of opportunity, diversity and inclusion, and the updated Code is designed to help charities on this journey.

“We’ve also heard that charities and boards would like more guidance on how to improve their approach to EDI. In response, we are asking charity umbrella and infrastructure bodies to provide more guidance and support to charities, to help them meet the recommended practice in the Code.”

The revised code also includes an update to its ‘integrity principle’, emphasising the importance of ethics and safeguarding for all those who encounter the charity. The principle asks trustees to fully understand their responsibilities regarding safeguarding and to establish appropriate safeguarding procedures so that all those that come into contact with the charity – staff, volunteers, service users etc. – know how to raise concerns.

About BHIB Charities Insurance

BHIB Charities Insurance specialise in providing tailored cover for community groups, clubs, societies, voluntary organisations and hobby or special interest groups. We offer more than just insurance and we are passionate about supporting local communities.

To find out how we can help your charity or not-for-profit organisation, email us on hello@bhibcharities.co.uk or call 0330 013 0036 to speak to our friendly, expert team.

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