Kids Company: What lessons can we learn?

Following a High Court trial and six year investigation by the Charity Commission in England and Wales we now have a report into the failure of Kids Company and the subsequent, very public, fallout. The Charity Commission report, which details serious mismanagement, makes for interesting reading for anyone involved in charity governance and provides a number of lessons to be learnt for our sector.

The Kids Company case gives us lots to discuss, not least on the role and responsibilities of trustees and senior management, and the tensions between governance and operations. Emma Maxwell, Senior Associate at Burness Paull, partners in the SCVO Pro Bono Service has already highlighted a number of key themes from the Charity Commission report which have broader significance for our sector. One of these is the importance of having the right blend of skills and knowledge on boards. This is a theme we explored during Trustees Week 2021 when SCVO ran a number of webinars on board recruitment and diversity and also highlighted Reach Volunteering’s excellent Trustee Recruitment Cycle.

Emma’s piece also focuses on how Kids Company, and its aftermath, shows how the principles of good governance should underpin all aspects of charity management. Scotland has its own Governance Code for the Third Sector, which sets out five core principles and key elements of good governance for the boards of charities, voluntary organisations and social enterprises, whatever their shape, size or activities. This is supported by the new digital SCVO Good Governance Checkup which guides you through the principles of the Code, helping identify areas where you can improve, and giving you a personalised action plan with links to further resources, policies and templates. It’s a great way to get the conversation started about good governance at board meetings.

We can all recognise that trustees often have a tough job to do, are unpaid, and unfortunately also sometimes ill-equipped to deal with governance crises. The Kids Company trustees had to make some very tough decisions in difficult circumstances, whilst endeavouring to act in the best interests of their charity. Hindsight is a wonderful thing, but what we can be certain of is that trustees must be well informed and fully aware of their individual and collective roles and responsibilities. They should have a comprehensive induction when they start out, and continuous training and development to fully contribute to the success and sustainability of their organisation.

That’s why we’re planning some lunchtime webinars with our Pro Bono Service partners to look at trustee roles and responsibilities. We’ll cover what you need to know about charity law and good governance and what trustees can and can’t do, so your new and existing trustees can play a full part in decision making. The first webinar is on 30 March so book your place today. If you’ve already recruited new trustees and want to get started now, check out our information for new trustees and our sample Trustee induction checklist which you can use to prepare your own induction process. Start as you mean to go on with good governance, and learn the lessons from Kids Company.