Trustee appraisals – have you got yours in place?

In recent years, Trustee Appraisals have moved from being something that only big charities do to something all charities are now expected to do.

The Charity Governance Code for smaller charities sets out an expectation for Boards to review their own performance and that of their chair, including:

“the board’s balance of skills, experience and knowledge, its diversity, how the board works together and other factors that affect its effectiveness”

Individual trustees are also expected to be able to explain how they check their own performance.

The Code's version for larger charities goes even further than this, recommending an external evaluation to be undertaken every three years.

Despite this, many Boards are still grappling with the idea, and don’t know quite where to start. Some Trustees are worried that an external appraisal will discourage other people from becoming Trustees. Some think that volunteer Trustees shouldn’t be critiqued, and others simply don’t think it is particularly important.

Here are five reasons why Trustee appraisals are absolutely crucial to good governance, and to the effective functioning of charities.

1.   No one else is overseeing Boards.

Trustee Boards have little to no oversight externally. In smaller charities, the Charity Commission is highly unlikely to get involved unless things go badly wrong.

In the absence of any external oversight mechanism, internal appraisals are the only way that Trustees will gain the opportunity to learn, develop and avoid repeating mistakes.

2.      Those in a position of responsibility and power must be accountable.

If you think it is important to appraise your CEO (which it is!), then it’s just as important to appraise your Board. Board members have the ability to make major decisions affecting beneficiaries and staff, and they must be accountable for this. In membership charities, members usually have some influence over Board composition, but this is not the case in non-membership charities. Without some form of appraisal, decisions can potentially be made without consequences, learning and accountability.

Appraisals give the opportunity for Trustees to reflect on their successes and failures and, ideally, give other stakeholders (such as staff, volunteers and beneficiaries), the opportunity to feed into the process. Done well, it is a positive, constructive and rewarding process.

3.      Many Trustees are not experienced in the charity sector, creating risks that need to be managed.

It is primarily in the third sector that we see people with little to no experience of an industry lead organisations within it. Trustees are often experienced in their own fields, but lack knowledge and experience in the charity sector specifically. Despite this, Trustees are responsible for meeting and upholding detailed charity standards and regulations. Without appraisals, Trustees are not given the opportunity to identify areas where their knowledge is inadequate, which can lead to serious consequences for the charity.

Appraisals give the opportunity for Trustees to understand the requirements of the charity sector and identify areas where they or the Board may need additional or external support and guidance.

4.      Appraisals can improve staff-Board relationships.

Many charities struggle to manage the relationships between the Board and staff. Both sides can become frustrated with each other, and the two most common accusations made against Trustee Boards by staff is that they are either too involved in operations and fail to understand the nature of their role, or that they are too distant from the charity and don’t sufficiently engage with the staff.

Appraisals which allow the staff to feed into the process ensure that Trustees can resolve or understand problems within the relationship. The process can highlight what staff appreciate and value about Trustees, as well as what they’d like to see changed. This can help Trustees understand the staff perspective, and either identify areas where staff understanding of the Trustee role could improve or where Trustee behaviour should change.

5.       It provides the opportunity for continuous learning and development.

Charities and their staff are expected to embrace continuous learning and development, whether that’s through their projects, their strategic planning cycle, or as individuals through their own appraisal systems. The same should be true for Trustee Boards.

No-one is an expert on everything, and everyone involved in a charity has a responsibility to do their best to identify their areas for growth – both individually and as a group – and see learning and development as a lifelong activity that is an opportunity, not an inconvenience or an offence.

Action Planning can help design a tool specific to your charity for you to use internally, or we can conduct a full and robust independent appraisal and governance review. Some Boards combine independent Board appraisals with a full governance review every 3-5 years, with a lighter touch internal appraisal process held annually. This can be really helpful and a worthwhile investment, especially if you get help setting up your ongoing process at the time of your first independent review.

In my experience, the charities that get themselves into major problems tend not to have an appraisal process. They are less likely to seek professional help when needed, and they are also less likely to have robust recruitment and induction procedures in place for Trustees. Getting a good appraisal system in place will help your charity to become more robust and effective - so what are you waiting for?