To act within powers, and to comply with the company’s constitution.
To act (in good faith) to promote the success of the organisation.
To exercise independent judgment.
To exercise reasonable care, skill and diligence.
To avoid conflicts (or possible conflicts) of interest.
Not to accept benefits from third parties.
To declare any personal interests.
There are also general duties to act:
In the interests of creditors (especially in times of financial difficulty).
In the interests of its employees.
With regard to the long-term consequence of any decision in mind.
With regard to relationships with suppliers, customers and generally with its local community and the environment.
To maintain reputation.
To act fairly as between members of the organisation.
There are also specific duties including:
The obligation to file information at Companies House.
Not to trade whilst insolvent.
To operate in accordance with the relevant Health and Safety regulations.
Chairs have a key role in ensuring the charity complies with the law which can feel daunting. The law is complex, wide-ranging, and changeable. Legal advice is typically expensive, may slow things down and can feel like a block to action. But a breach of the law can have serious consequences for the charity, and sometimes for the trustees personally. This briefing helps you understand the issues and find a workable approach.
This guidance applies to the trustees of all charities in England and Wales, registered and unregistered. The Commission recommends that trustees read this guidance to understand the basics, and how it expects them to deal with conflicts of interest facing them or their charity. First published May 2014. Latest edition February 2017.
A guide to conflicts of interest policies, trustee benefits and transactions between trustees and charities from DCMS and the Charity Commission. First Published: 2008, re-published 2018.