ACCOUNTABILITY
Ensuring its Trustees are Accountable to Monthly Meeting
By Stephen Petter. Revised 3 June 2006.
The 27 March 2006 meeting of the Monthly Meeting Task Group on Charitable Registration,
item 3 included: "We ask Stephen Petter to read through the model governing document produced by QSC (Quaker Stewardship Committee) to identify changes he feels should be made to ensure the accountability of trustees to the Monthly Meeting".
BACKGROUND
I will not repeat here the reasons why it is accepted that the Society nationally, and each MM, has no realistic option other than to register with the Charity Commission if and when the law is amended, which is expected soon.
Nor will I do more than mention in passing that although it seems generally accepted that a small group of 5 to 15 members will be appointed by MM as its trustees, I remain convinced that MM itself could be the trustees.
QSC has issued a document, "Constitutional Issues - Supplement to documents in Advance 2006" which includes the proposed governing document for the national level Britain Yearly Meeting, which was approved by YM in May 2006. It also includes a model or template Governing Document for MMs which YM commended.
It seems clear to me that the national, Britain Yearly Meeting Governing Document (BYM GD) has received most of QSC’s attention. The Monthly Meeting version (MM GD) is more rudimentary.
The interesting parts of the BYM GD, in the present context, are those which are intended ensue to that BYM Trustees are accountable to YM in session and to Meeting for Sufferings.
MMs are free to establish their own structures but (we are told) any substantial deviation from a centrally agreed template would pose difficulties and incur costs. At Yearly Meeting it was said that the template could be amended only to accommodate local needs. I called for the ability to make more substantial changes, such as the ‘catchall’ clause in the MM template. I was assured this would be possible, though the word ‘local’ was not deleted from the Minute.
CONCERN
The concern is that if we register our MM as a structure that includes a small body of trustees, we do so with a governing document that ensures as far as possible that the trustees act in accordance with the concerns and aspirations of MM at all times.
PROBLEMS
The central problem is that trustees are by definition those who control a charitable trust. The Charity Commission will not accept a governing document unless it shows the trustees to have this authority. But our traditional gospel order has our decision-making centred on meetings that all Friends are entitled to attend, such as YM and MM, or in the case of Meeting for Sufferings, one in which the fullest practicable extent of representative participation was built in. These bodies often set up smaller committees to implement certain aspects of their work but it was always clear that final authority remained with the larger body. Meeting for Sufferings was the Trustees of BYM. However, both the YM GD and the template MM GD establish the smaller body as trustees.
How can we prevent the cautious, legalistic, formal tail from wagging the adventurous, Spirit-led, informal dog?
Another fundamental problem is that all documents and books about trusteeship including those published by the Charity Commission are centred on the trustees’ responsibilities with respect to property and finance. There is scant guidance for trustees dealing with other aspects of the management of a complex organisation.
(Of all the corporate forms available, a Trust is not the best for a complex organisation. The model adopted by most charitable trusts is to incorporate themselves initially as Companies Limited by Guarantee, which defines essential structures and procedures to control all aspects of the organisation’s work, then register the Company as a charity. The directors of the company are bound by the members’ policy decisions, but are also the trustees bound by the Charity Commission’s requirements.)
THE ROLE OF M.M. TRUSTEES
The template MM GD commences: "X Monthly Meeting … will be administered and managed in accordance with this governing document". It goes on to say "The object of X Monthly Meeting is the furtherance of the general religious and charitable purposes of [BYM] in [its geographic area]". The implication is that the document covers all the MM’s activities.
The template states the constitution and powers of the trustees. It does not mention any powers of the MM in session nor any requirement for the trustees to heed MM other than:
a. to report annually and submit ‘for information’ the accounts to MM within 8 months of a year-end, and
b. to ‘refer’ issues such as selling a meeting house to MM - though the final decision rests with the trustees. (Quoting the example of selling a meeting house implies quite clearly no need to refer lesser issues.)
A critical feature of any Governing Document is the statement of its powers. The template GD covers all the MM, but it does not list any other powers than those of the trustees.
In its Section 12 the template MM GD defines the trustee body - its number (5 to 15), its appointment (by MM) and their length of service (maximum 9 years). Section 13 describes how ‘a trustee’ (not ‘the trustees’) might be removed from office. It seems clear that if he or she did not wish to resign, dismissal would be quite difficult and rare.
In Section 14 the powers of Trustees are listed. Most of these are the normal financial powers that one would expect to see (including ‘to employ staff’). The final, catchall clause is: "To do any other lawful thing that is necessary or desirable for the achievement of the objects of the monthly meeting". Note no mention of the wishes of MM in session nor of the general membership.
Thus we are invited to appoint a few trustees, selected on the basis of certain abilities, experience and attitudes, to be given sole authority to decide what is ‘necessary or desirable’ to meet (their understanding of) the MM’s broadly stated object with no requirement to liaise with MM in session. In this they will have the power and authority of the law, through the Charity Commission.
Moreover the essence of trusteeship is that each trustee is personally liable. (The extent and relevance of this liability is the subject of some debate, but a trustee’s personal liability is certainly greater than that of a director of a limited company.) The effect is to make trustees cautious and conservative.
The danger as I see it (and apparently as seen at national level) is that these few trustees could have an entirely different agenda from that of the general membership.
REDUCING THE DANGER
So, what are the features that may be changed or inserted into the MM GD template to reduce this danger? In brief, we need only incorporate into the MM Governing Document the provisions that have been inserted in to the BYM GD in order to ensure that BYM Trustees are accountable to MfS.
Section 8 in the BYM GD states requirements about the relationship between MfS and the trustees which are absent from the MM GD. Following is my suggested wording for the MM GD, based on that in the BYM GD. [Section 9 in MM GD is the equivalent of Section 8 of BYM GD.]
9. Meetings for Church Affairs.
Add, at the start: Within the Society of Friends in Britain the Monthly Meetings in session are the main local meetings for church affairs and are the level of the society at which individual membership is held. All members have the right to attend and take part in the deliberations. A Monthly Meeting is charged with:
a. deliberation and discernment, and oversight of the Monthly Meeting’s corporate religious life; and in particular with:
b. receiving interim reports [for information] from the body of trustees constituted in Clause X of this governing document.
(End of addition)
I question whether the phrase ‘for information’ is needed and recommend it be deleted. It is redundant except that it implies recipients of the reports have no right of reply.
Then may follow the two paragraphs which currently commence Section 9, though I suggest they would be better located elsewhere;
Then should follow the current sub-items i, ii, and iii.
14. Powers of Trustees.
Regarding the financial powers, it seems to me that, oddly, the MM GD gives MMs wider scope than BYM. I suggest we ask someone with better financial expertise than I have, to examine these clauses (14, i to xii) against BYM GD 15 a. to i.
As for the final catchall clause, I recommend that we replace the wording in the MM GD with that in the BYM GD, i.e.
"To do all other such lawful things as are necessary for the efficient conduct of the charity’s [or ‘the monthly meeting’s] administration and the management of its property and affairs."
But I would go further and replace ‘affairs’ with ‘finances’. (i.e. the same as in the terms of reference of our current trustee body.)
I would also go further in omitting ‘lawful’ as it is normally redundant but we (in our MM) have decided that on occasion we might agree to ask them to risk being unlawful, e.g. in supporting civil disobedience at Faslane.
(Readers may remind themselves of the antecedents of this document, namely the RECAST proposals, one of which was that MMs should delegate most of their business to committees and local meetings so that the meeting held monthly could be more inspirational and spiritual. This was the only provision which my local meeting considered unrealistic. Possibly due to lack of time QSC seems to have thoughtlessly bolted the trusteeship role onto what was to have been a MM executive or administrative committee, responsible to MM for most MM activities. The BYM GD wording implies a more restricted role, admin and finance and property.)
Further accountability. The BYM GD concludes with a section "Aid to interpretation, not forming part of the Governing Document". (Note that in the BYM GD MfS is NOT the trustees.) It specifies that MfS is "entrusted with the general care of a matters affecting BYM… discerns major and long-term priorities and considers reports from the trustees…"
It goes on to say "The duty of Trustees is to ensure the priorities … set out by BYM and MfS … are being followed… and that the governance and management….
(Earlier drafts and RECAST were even more specific about the roles of MfS and Trustees, e.g. that only MfS and not Trustees sets the priorities and long term plan and only Trustees manage all the (centrally controlled) activities according to those plans, and how MfS was to monitor the trustees.)
If my suggestions (above) regarding Section 9 are not accepted then I suggest we follow the BYM example by adding a similar "Aid to Interpretation":
Aid to Interpretation
Within the Society of Friends in Britain the Monthly Meetings in session are the main local meetings for church affairs and are the level of the society at which individual membership is held. All members have the right to attend and take part in the deliberations. A Monthly Meeting is charged with:
c. deliberation and discernment, and oversight of the Monthly Meeting’s corporate religious life; and in particular with:
d. receiving interim reports [for information] from the body of trustees constituted in Clause X of this governing document.
Section 18 Annual Reports and Accounts.
An annual report to the charity Commission is not only a financial report, but a general report.
The MM GD only requires the trustees to show their annual report to MM within 8 months of the financial year-end. I would hope we add a requirement for timelier, more frequent, and more comprehensive reporting. In addition to what is currently proposed (though it seems to me it includes some needless repetition) we might ADD:
iv) Trustees shall forward the minutes of each of their meetings within one month to the clerk of MM with advice as to which items if any should be regarded as confidential. The clerk to MM shall then make the minutes available to members as appropriate.
OTHER SUGGESTED AMENDMENTS
Where the BYM GD and the MM GD differ in a manner that seems trivial or pointless to me, I recommend adoption of the BYM wording simply because more attention has been paid to it by our national experts.
Section 1. ‘shall’ not ‘will’.
Section 6: ‘must’ not ‘shall’.
Section 9 heading. Replace "Meetings for Worship for Church Affairs" by "Meetings for Church Affairs" .
Section 12.iv. BYM GD has YM appointing the clerk to trustees. Amend this section to have MM appoint the clerk to MM trustees on nomination from MM Nominations Committee, not on nomination of the trustees.
Section 12. The BYM GD simply says BYM shall appoint trustees. I see no reason why the MM GD should be much more detailed and prescriptive. MM Nominations Committee should be free to use its judgement, perhaps with informal advice from QSC.
Another so far unrecognised problem with the MM GD which I hope to address is that Section 17, Power of Delegation, does not seem to take account of the role of local (Preparative and Recognised) Meetings. A MM with several local meetings would not be able to delegate any business to them unless they had two trustees each. Alternatively a local meeting could only conduct delegated business if a trustee from another meeting were present.
As time is short I shall issue this now. I intend to prepare a revised draft of a MM template as soon as possible.
Stephen Petter
3/6/06
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