The recently updated Charity Governance Code, which sets out 7 principles of good governance practice for charities in England and Wales, includes clearer recommended practice in the renamed Equality, Diversity and Inclusion (EDI) Principle, and updates to the Integrity Principle to emphasise ethics and the right of everyone who has contact with the charity to be safe.
The 2020 update to the Code follows a rigorous consultation with the charity sector that involved user focus groups and received over 800 responses. With feedback particularly focused on the diversity and integrity principles, the Code’s Steering Group commissioned specialist EDI consultants to carry out further research and advice.
Rosie Chapman, Chair of the Charity Governance Code 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 Code recommends four stages of practice for charities in their EDI journey. Boards should:
- Think about why equality, diversity and inclusion is important for the charity and assess the current level of understanding.
- Set out plans and targets tailored to the charity and its starting point.
- Monitor and measure how well the charity is doing.
- Be transparent and publish the charity’s progress.
Pari Dhillon, independent EDI consultant who advised the Steering Group on the changes, said:
As a governance and EDI fan, I’m very excited about the launch of the Equality, Diversity and Inclusion principle, for two reasons. Firstly, great EDI has the power to create social justice in our boardrooms, charities, sector and ultimately society. Secondly EDI practice sits at the heart of good governance, and I’d argue you can’t have one without the other. I say this because:
To maximise public benefit, boards must focus on achieving equality of outcomes through their charitable purpose.
To make better and more informed decisions, boards must be diverse, reflecting and centring the voices of the community and needs that the charity seeks to serve.
To make robust decisions, all board members must have the power to fully participate and societal power imbalances must be prevented from playing out in an inclusive board room.
Malcolm John, Action for Trustee Racial Diversity commented on the new EDI Principle:
I’m delighted that the updated EDI Principle picks up the mantra of Actions not Words by encouraging charities to focus firmly on agreeing plans, setting targets and monitoring their progress. I’m hopeful that this will help set charities on the path to achieving greater racial diversity at all levels by moving away from informal recruitment processes for trustees and committing time and resources to drawing from a wider and more diverse pool of people.
As part of the Code’s refresh, the Integrity Principle has also been strengthened to emphasise the importance of a charity’s values, ethical decision making and the culture this creates.
Rosie Chapman, Chair of the Steering Group explains:
We’ve also updated the integrity principle to reflect the importance of everyone who comes into contact with a charity being treated with dignity and respect and to feel that they are in a safe and supportive environment.
In particular, the Code includes new recommended practice on the right to be safe (safeguarding) that asks trustees to:
Understand their safeguarding responsibilities.
Establish appropriate procedures that are integrated with the charity’s risk management approach.
Ensure that everyone in contact with the charity knows how to speak up and raise concerns.
As any experienced business executive who joins a Charity Board as a Trustee knows, running a charity, especially in 2020, is a particularly challenging task. Charity Chief Executives should be able to draw on the widest range of skills, background and experience from their Trustees for support. EDI should not be seen as pandering to sentiment but as an essential requirement to ensure that Boards have the best people contributing to the governance of the Charity, regardless of gender, race, ethnicity or class.
Charity Trustees are, by and large, enthusiastic, unpaid, supporters of the cause that their charity serves but they should also ensure that they understand their role, duties and responsibilities - the updated Charity Governance Code is essential reading for all charity Trustees.