Making “Good Governance” Better - The Revised Code of Good Governance
16 March 2022
It is essential that charities understand what is required from a governance perspective. Good Governance is not a tick box exercise but rather an elephant in the board room at all times, and one to which close attention should be paid. Having a reference point for what good governance looks like is something that all charity boards can benefit from.
Earlier this month we were pleased to hear from Denise Copeland (Governance & Charity Advice Manager at NICVA) and Denise Hayward (CEO of Volunteer Now) in relation to The Revised Code of Good Governance which was launched late last year.
The Code of Good Governance (the “Code”) sets out the principles and key elements of good governance for the boards of not-for-profit organisations including charities, voluntary, community, sporting, faith and social enterprises.
The aim of the Code is to help the boards of these organisations to develop high standards of governance and improve their governance practice.The Code was first launched in 2008 by the Developing Governance Group, following consultation with the voluntary and community sector which recognised the need to have its own principles of governance.While it is not mandatory, it has been widely accepted as the set of standards for governance practice in the sector.
The revised Code sets out five key principles that form the basis of the Code, together with the recommended practice. Those principles are as follows:
Principle 1 - Understanding its function in delivering organisational purpose
The members of the board are equally responsible in law for governance. They are collectively responsible for ensuring that the organisation remains faithful to its purpose.
Principle 2 - Working as an effective team
The board will ensure that it has an effective balance of knowledge, skills, attitudes and behaviours to deliver organisational purpose.
Principle 3 - Maintaining control making effective decisions and managing risk
The board has ultimate responsibility for setting the vision and strategy and overseeing the activities of the organisation.
Principle 4 - Acting with integrity
The board should act at all times with honesty and probity in the interests of the organisation and its beneficiaries and members. The board ensures that the organisation’s performance and interaction with its stakeholders are guided by the values, ethics and culture put in place by the board.
Principle 5 - Being open and accountable
The board leads the organisation by being open and transparent, accountable and responsive.
If you are considering implementing the Code of Good Governance within your third sector organisation and want to discuss further please contact Rosie Timoney or a member of the Charity Team.