Company Secretaries - their role in the third sector.



Charities and Not-For-Profit organisations (NPOs) make an important contribution to both society and the economy. Apart from their good work, charities and NPOs are also businesses with their combined income reaching billions of pounds every year. The growth of the sector, responsibilities placed on them by successive governments as well as public distrust has resulted in charities and NPOs adopting working practices and governance standards similar to the those of the private sector.


A focus on good governance means that these organisations need clear strategic planning, risk assessment and management, a careful selection of the board of trustees and a clear understanding of the duties and responsibilities of the board. In addition, charities have a number of regulatory obligations they need to adhere to, such as complying with the Charities Act, having some form of governing documentation and submitting their annual report and accounts (depending on their size) to the Charity Commission.

It follows, that just like in the private sector, the role of the Company Secretary is of great importance. This role, which is sometimes undervalued and misunderstood, is key to organisational success in this sector. Specifically, it has been found that Company Secretaries make a significant contribution to board performance, share the same qualities as good chairmen and enable effective decision-making (Henley Business School, 2014).


The role of the Company Secretary is far from just an administrative position. A Company Secretary will strive to ensure good governance within the organisation and draw up procedures that will enable a good governance framework; will ensure compliance with all applicable legislation; will facilitate dialogue in the boardroom and will offer impartial guidance and advice to the board. According to the editor of Charity Finance magazine and former chief executive of the Charity Commission, a Company Secretary plays a crucial role “…particularly in supporting the all-important governance relationship between the trustees and executive management.”


Board members are often unaware of the ways Company Secretaries support such organisations. However, this role is becoming increasingly strategic, especially when applied to the not-for-profit sector, where money resulting from public funding or private donations must be spent wisely, effectively and ethically.


Company Secretaries can have a positive impact on charities and NOPs as their role is core to good governance and the performance of the board.


We are in touch with a wide network of company secretarial professionals at all levels. If you think that your organisation would be benefited by their skills and expertise, then get in touch with one of our consultants on 020 3589 0333.

23 February 2016



written by Mariza Dimaki
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