Governance within the UK charity sector : case study evidence from three charities

Wilson-Cole, Dennis E.N. (2011) Governance within the UK charity sector : case study evidence from three charities. (DBA thesis), Kingston University, .


In 2001, charities in the UK celebrated the 400th anniversary of their legal birth. They now wield considerable economic influence in their contribution to the economy as changes made to the welfare state over the last 20 years have transferred the delivery of some essential public services to the sector. However, the research problem (and hence pressing challenge facing charities) is whether their governance systems and processes are keeping pace with their growing role in Britain today. The objectives and purpose of this study become, therefore, to examine, describe and evaluate the various elements of charity governance from an 'insider-trustee' perspective and from there to build both theoretical understanding of, and insight into effective charity governance, such as to bridge identified gaps in the literature. This has become necessary because, 'for the first time in history, charities are ... now receiving more cash from the state than private donors' (Brindle, 2010, p. 1), and need, therefore, to demonstrate accountability to the UK taxpayer. Three research questions have guided this study: (i) What constitutes effective charity governance?; (ii) How does the Charity Board contribute to effective charity governance?; and (iii) Who are the stakeholders in charities, and does their recognition and engagement contribute to effective charity governance? The study adopts a descriptive, comparative, cross-sectional and multiple case study approach in order to explore the experiences, procedures and systems of third sector governance in three UK charities. This research design is considered suitable because it offers a robust, scientific methodology to investigate and understand the emic nature of the research problem. A conceptual framework developed on the three main themes of: (i) organisation structure and strategy, (ii) internal governance mechanisms, and (iii) external governance mechanisms, is used to provide the intra-and cross-case analysis presented. Participatory observation of governance meetings provides both an insider and direct access, insight into and understanding of, governance in the object charities. Document analysis is also employed to collect relevant data. However, the main data collection method employed is in-depth, face-to-face, open-ended interviews with trustees, Management Committee members, directors and Chief Officers of the object charities. The findings from the study reveal that although there are various elements of best practice governance in the object charities, significant room remains for improvement in organisation structure and both internal and external governance mechanisms in order to achieve effective charity governance. The study has made contributions to theory, practice and policy in several areas. In the area of theory, this research presents the first comparison of the development of corporate and charity governance in Britain. The study offers suggestions on how corporate governance codes can be 'flexed' for charities. In the area of practice, specific governance recommendations are made to transform the practices of the three charities. Training courses for trustees, chief officers and other executive directors have been developed from the empirical data and the literature. In the area of policy, changes in regulations are suggested. Finally, the empirical findings and literature provide a model which can be used by charity trustees and chief officers to assess the effectiveness of their governance arrangements. This model has been classified as the emergent principles of effective charity governance being: (i) optimal, responsive organisation structure; (ii) clear direction of travel based on defined goals and objectives; (iii) committed and focused governing body; (iv) sound financial and risk management; and (v) open, ethical and accountable stakeholder engagement.

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