Charity Trustee Duties

Who are charity trustees?

Charity trustees are the people who make up the governing body and have “general control and management” of a charity. They can also be known as: directors, management committee members, or committee members.

Charity trustees are responsible for the governance and strategy of their charity. They are responsible for making sure that their charity is administered effectively, and is able to account for its activities and outcomes both to us and to the public.

What is expected of charity trustees?

Section 66 of the Charities and Trustee Investment (Scotland) Act (“The 2005 Act”) sets out:

four general duties which are fundamental to charity trustees
a number of specific duties which charity trustees must comply with.

General duties

A charity trustee must:

1. Act in the interest of the charity: trustees should put the interests of their charity before their own interests or those of any other person or organisation.

2. Operate in a manner consistent with the charity’s purposes: trustees should carry out their duties in accordance with their governing document.

3. Act with due care and diligence: trustees should take such care of their charity’s affairs as is reasonable to expect of someone who is managing the affairs of another person.

4. Ensure that the charity complies with the provisions of the 2005 Act and other relevant legislation.

Specific duties

Additional duties for charity trustees include:

1. Updating your charity’s details: trustees must make sure that we hold the latest information about their charity on the Scottish Charity Register. Charities must first seek our prior consent before taking certain actions. More information about when a charity must contact us for consent and when they must tell us after certain changes have been made is available on our Making changes to your charity page.

2. Reporting to OSCR: complying with the statutory duty to supply certain information to us:

3. Financial record keeping and reporting: section 44 of the 2005 Act states that charities must:

keep proper accounting records
prepare a statement of account, including a report on its activities, at the end of each financial year
have the statement of account independently examined or audited
send a copy of the accounts, along with the annual return, to us.

Accounting records should be kept by the charity for a minimum of 6 years from the end of the financial year in which they were made.

4. Fundraising: trustees are responsible for taking control of how their charity fundraises.

5. Providing information to the public: trustees must make sure that their charity meets the statutory provisions when referring to their charitable status , e.g. in advertisements, and in their duty to provide information about their charity to the public.

Trustee remuneration

Charity trustees must act in the interests of the charity. Any personal benefit to a charity trustee, whether direct or indirect, has to be treated with caution. Read our Charity Trustee Remuneration page for more information.

Trustee Indemnity Insurance

Some charities may wish to take out Trustee Indemnity Insurance (TII) which provides cover for legal expenses and awards made against individual trustees. However, TII falls within the definition of "remuneration" in Section 68 of the 2005 Act because it provides personal benefit to the charity trustees. Because most policies benefit all charity trustees, TII falls foul of the condition that only a minority of charity trustees can benefit from remuneration. Charity trustees will be in breach of the 2005 Act if they authorise TII covering all of the charity trustees.

We have been working with the Scottish Government to find a solution to the problem. For further background information on TII and an update of the current situation read our Trustee Indemnity Insurance page.

Trustee investment powers

Sections 93 to 95 of the 2005 Act sets out the powers of investment of trustees and associated duties. Trustees are entitled to make any kind of investment of the trust estate, including a wider power to acquire stocks and shares. However, these powers are subject to restrictions and exclusions and do not extend to certain categories of trustees. Further information about the restrictions and exclusions can be found in the guidance below.

Breach of duty

OSCR has a duty to act where there is evidence that charity trustees are behaving improperly. Our response will be proportionate depending on the breach. Further information on how we will take action in cases of misconduct can be found in our guidance below.

Guidance

The focus of the Guidance for Charity Trustees is on the duties and responsibilities of charity trustees in Scotland. It also offers examples of good practice in the governance of charities which should help charity trustees fulfil their duties and responsibilities. Click on the links below to read the guidance:

Guidance for charity trustees

Guidance for charity trustees - in Bengali

Guidance for charity trustees - in Easy Read (Word version)

Guidance for chaity trustees - in Easy Read (PDF version)

return to top