The guidance brings together existing commission guidance that sets out the key principles that trustees must follow when making decisions about grant funding non-charitable organisations.
The guidance states that trustees must be able to show how any grant to another organisation (whether a charity or not) furthers their charity’s purposes.
In addition, a charity grants can only be made for activities that in principle it could carry out itself.
Trustees must also comply with the powers and restrictions in their charity’s governing document and ensure that the recipient of the grant understands and agrees the aim of the grant, how this is expected to further the charity’s purposes, and what the grant can and can’t be used for.
Sarah Atkinson, director of policy and communications at the Commission said:
“Trustees have clear responsibilities when deciding where their funding goes, but it is particularly important that they recognise any risks that come with making grants to non-charitable organisations. We want this guidance to set out clear boundaries for trustees to ensure that charity funds are applied properly and to help them if things go wrong or circumstances change during the life of a grant.”
The draft guidance is available on the .gov site and is under consultation until 8th April. Comments can be emailed to firstname.lastname@example.org.
Get free email updates
Keep up to date with fundraising news, ideas and inspiration with a weekly or daily email. [Privacy]