Hello 2020! We’re back and we’d like to wish you all a happy and a prosperous New Year. Hopefully you haven’t overdone it too much during the festive period. We’ve just about shaken off our festive hangover and believe it’s time to start thinking about Third Sector Governance as we move towards fresh beginnings and new opportunities.
So many third sector organisations started with good intentions, however, as they grow and change over time, the controls which worked at the beginning no longer meet the requirements of today’s public expectations. Complex regulation also continues to evolve and change, leaving many Third Sector Organisations in the dark over what they need to do in order to stay compliant.
Many organisations should use the New Year to take a step back and think about what they currently do, how they currently do it and understand what they should be doing. Failure to plan effectively can have hugely negative results for a Third Sector Organisation.
Charities that are not governed effectively will find it harder to meet their objectives and make the most of their resources. The most serious cases of poor governance can lead to intervention from regulators, significant reputational damage, and disillusionment among staff, volunteers and trustees. Good Governance means great business practice resulting in long term sustainability.
Best Business Practices for Third Sector Organisations
When following best business practices, an organisation is more likely to:
- Ensure funds are generated
- Have better cash flow
- Operate with less financial risk
- Exercise sound risk management
- Find it easier to access external grant finance
- Develop in both the good and the bad times
Implementing good business practice involves:
- Identifying the critical tasks that must be done to keep a charity in good shape
- Having the discipline to ensure that those tasks are carried out consistently and regularly
You need to ensure that you are ready for your Financial Tasks:
- Regular preparation of financial statements
- Removing the pressures of the “year end”
- Improving the quality, and usefulness of financial data – creating information
- It’s about providing regular access to financial information – cash flow
Successful Strategy for Third Sector Organisations
Organisations need to ensure they get their governance right. The decisions you make in relation to this are critical in determining the future direction of your organisation, they need to be carefully considered, developed, structured and implemented.