Welcome to the Guide to Finance - Dame Suzi Leather
Foreword
The rules of fiscal prudence have been turned upside down. Investments considered safe as houses by the ratings agencies have proved to be exactly that, as house prices plunge and the value of legacies takes the hit.
The post-recessionary mantra may eventually be that greed isn’t actually all that good in the long run, and that creative financiers need to deliver investment vehicles which their regulators can themselves understand in order to police them.
The lesson for charity trustees may well go far beyond the need to choose your financial experts wisely. Commitment, passion, and innovation are all in plentiful supply in the charity sector, but financial literacy probably remains at a premium. This welcome supplement aims to help trustees tackle this financial literacy deficit and put themselves on a more confident footing when it comes to overseeing their charities’ finances.
For, while charity trustees should ensure they are seeking advice from experts if they need to, theirs is the ultimate responsibility for ensuring their charity is solvent and well-run. There’s no doubt that charity finance and law can, initially, seem daunting to the uninitiated board and trustees who will clearly benefit from the collective shot in the arm this supplement provides. Particularly in a recession, the levels of financial knowledge and awareness of the collective board when it comes to making and spending money can make the difference between a charity surviving and thriving.
Business needs to be the board’s business, not exist purely in the silo of the finance director or treasurer. While their specialist experience and knowledge is key to developing and implementing any charity’s financial strategy, the board as a whole needs to develop the knowledge both to critically challenge and to contribute to the development of
financial strategies.
The Commission’s March 2009 Economic Survey of Charities showed the number of charities surveyed who reported they were being affected by the economic downturn had grown to 52 per cent up from 38 per cent in the previous autumn’s survey. With growing numbers of charities facing the double hit of increasing demand for their services and declining income, getting to grips with investment and income streams has never been more timely. This guide covers all the basics, from legal requirements to investment strategies to managing relationships with professional advisors, enabling trustees to get to grips with managing the money.
I wish every trustee reading it a solvent, sustainable and successful 12 months.
Author: Dame Suzi Leather
Dame Suzi became the Charity Commission's chair in 2006. Before this, she chaired the Human Fertilisation and Embryology Authority and the School Food Trust. Previously, Dame Suzi was deputy chair of the Food Standards Agency and chair of the Exeter and District Community NHS Trust. She is a member of Consumer Focus and, last November, was asked to chair DEFRA's Council of Food Policy Advisers.
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