> ## Content Index > Fetch the complete content index at: https://www.nedness.com/llms.txt > Use this file to discover other available public pages before exploring further. # The Other Boardroom part 1 - URL: https://www.nedness.com/articles/the-other-boardroom/ - Published: 2026-09-17T10:00:43.000Z - Updated: 2026-09-25T09:14:03.000Z - Description: This series of articles describes the unique aspects of not-for-profit boards, starting with what a charity board can teach a first-time or aspiring NED that a company board sometimes cannot. - Author: Tom Noel - Tags: #article, Board careers, Not for profit, #not-for-profit, Aspiring, #aspiring, Clarity ## Part 1: What a charity board can teach a first-time or aspiring NED that a company board sometimes cannot Securing your first Non-Executive Director (NED) role can feel like an uphill battle. You are told that you "need more board experience" and then comes the inevitable ‘chicken and egg’ as you try to land that first seat that would give you that experience. At the start of my own NED journey, I was given the advice to go and be a trustee for a few years, learn the ropes and then move on to a paid seat. For me, that treats the charity boardroom as a training pitch, and the company boardroom as the real match. Having now sat on several charity boards and committees, and on both sides of the executive and non-executive table, I couldn’t disagree more. Charity governance is not a lesser version of corporate governance. It is a distinct discipline, with different priorities, pressures, and success factors. It is these differences that are most valuable to an aspiring NED. In my opinion, a director who can move between both worlds, and carry the insights and learnings with them from one to the other, is a stronger contributor in both. In this series of articles, I will explore these differences. I will cover the power of mission and accountability, the line between the board and the executive, and the extra responsibilities that come from spending money that is not yours. ## The power of mission For a charity, its mission is not just words on a poster or a coffee mug. In the commercial world, a memorable mission statement is rare, and having one that features in the day-to-day decisions of the board is even more exceptional. In contrast, a good charity board knows exactly why the charity exists. Its mission is why the trustees turn up on a Tuesday evening, unpaid, after a full day at work. That clarity of mission has real benefit when resources are scarce, as they usually are. It becomes the governance guardrail for whether a decision makes sense and whether a cost is acceptable or not. The clarity of mission also makes it easier to say no and prioritise when there is no shortage of attention areas. A real-life example comes from the Royal Shakespeare Company (RSC). In 2019, they decided to end their long-standing sponsorship with BP, who had supported a scheme offering £5 tickets for 16- to 25-year-olds. The decision was not trivial; BP’s sponsorship had provided funding for 80,000 tickets to RSC performances. However, listening to young people is central to the RSC's mission, and so they made the brave decision to end the relationship based on hearing from them. Research showed that “Amidst the climate emergency, which we recognise... the BP sponsorship is putting a barrier between them and their wish to engage with the RSC. We cannot ignore that message.”[1](#fn-1) Irrespective of what you think of the decision, the lesson is that the mission drove the outcome. Commercial boards can struggle to say no, particularly when they lack a clear directional ‘north star’ against which difficult choices can be tested. A mission or purpose that is deeply incorporated into the business’s DNA, rather than simply written on their website, can help. ## The counterargument A charities mission is its superpower, but it can also become its Kryptonite the moment it is used to avoid making hard decisions. "Doing good" is not a reason to stop asking hard questions. I have witnessed weak financial controls being excused because the importance of the cause somehow justifies lower standards, and poor employee performance being tolerated just because everyone is trying so hard. A founder or a long-serving chief executive is allowed to operate beyond their capability because nobody wants to be known as the person who criticises the cause or the person leading it. The learning here is that mission can quietly become a test of loyalty, where challenging a decision feels like challenging the cause itself. At its peak, Kids Company had an income of around £23 million, a charismatic founder, a board of capable and well-connected people, and reserves of around £400k.[2](#fn-2) And yet, when a funding shock arrived in 2015, it folded within weeks. A parliamentary committee later called it an extraordinary catalogue of failures and pointed at insufficient reserves, a long serving chair, and a board that did not challenge its founder hard enough. Then in 2021, the High Court dismissed the attempt to disqualify the trustees, with the judge describing them as highly impressive and dedicated individuals.[3](#fn-3) Counterintuitively, both things can be true. Good people who were totally committed to the cause oversaw a charity that could not weather a bad month. The learning is that believing in the cause is not a substitute for asking tough questions. The trustees' first job is to make sure the charity is well managed and that uncomfortable truths are unearthed. Another public example I would refer to is the Captain Tom Foundation[4](#fn-4), a UK charity established to continue Captain Sir Tom Moore’s fundraising legacy by supporting organisations working with older people and other charitable causes. The Foundation became embroiled in controversy over conflicts of interest, private benefits to the founder’s family and inadequate trustee oversight. The Charity Commission published an inquiry in November 2024, and found that the much-loved cause had family members as trustees, conflicts that were never properly managed, and benefits that were never properly approved. The inquiry highlighted a simple but important point: trustees cannot effectively manage a conflict of interest if they do not know it exists. The problem is rarely dishonesty, it is failing to recognise that a conflict exists at all. Conflicts of Interest must be carefully managed and surfaced, rather than being a tick-box exercise at the start of a committee or board meeting. ## Who are your stakeholders and to whom are you accountable? On a company board, the people you serve are relatively easy to identify and access. Shareholders are visible, and in smaller or family-owned businesses, they are often sitting around the table with you. In a charity, the people you serve are almost never in the room. The beneficiaries, the donors, the regulator, the public and the volunteers rarely have a seat at the table. Therefore, a core discipline for any trustee is to keep these stakeholders front and centre of any decision you make. In my opinion, this is a real skill to apply in both private and public sectors. In charities, trust is a currency that grows over time, and when it is lost, it is very difficult to recover. In 2018, Oxfam faced a major safeguarding scandal after it emerged that staff working in Haiti had sexually exploited vulnerable people and that the charity had failed to handle the allegations adequately. Oxfam lost around 7,000 regular donors in the eleven days after the story broke.[5](#fn-5) If your donors do not trust you, the funds dry up quickly. Building trust with stakeholders should be a standing item for any charity board. Listed company boards are increasingly expected to consider the interests of a much wider group than shareholders alone, including employees, communities and the environment. Yet these stakeholders do not have a vote at the AGM. Charity trustees have long had to govern on behalf of people and interests that may have no direct voice in the boardroom. A NED who has developed that skill in the third sector can therefore bring valuable experience to a commercial board. ## What feels different on day one? A new trustee will notice many practical differences from a company board. On day one, you should be handed a constitution, a trust deed, or a set of rules, rather than articles of association. Often this constitution will be decades old, a few pages long, and silent on things you might expect to see, such as whether the board can meet online or pass a written resolution, how a trustee who doesn’t turn up regularly can be removed, or what happens to a charity's assets if it has to close. It’s also often more restrictive than the board realises, particularly on what money can be spent on, and whether trustees can be paid for their services. Reading it properly should be your first action, and if you are not provided with it, ask for it promptly. The next important question is what the legal form is, because the word ‘trustee’ carries very different personal liability depending on whether the charity is an unincorporated association, a trust, or a company limited by guarantee. A director arriving from the private sector may assume they have limited liability, which may not be the case. You may find yourself accountable to two different regulators: a charity regulator and a company registry. And you also need to understand who the organisation’s members are. Unlike shareholders, their role may be less obvious, yet they can have important governance powers, including the power to appoint or remove trustees. You will meet the concept of ‘restricted funds’, which is money given for a purpose that cannot be spent on anything else, however attractive the alternative may seem. There is no direct equivalent in the corporate world, and in my experience, it is the most common misunderstanding for a new trustee in a charity boardroom. You will need a written reserves policy that you can defend both to donors who did not give money "so you can sit on it", and to auditors who would be happier with six months of operating costs, rather than the three you hold. The balancing act gets even harder when part of your income is a government grant that can be withdrawn at short notice. Unlike a corporate board position, on a charity board you will almost certainly be unpaid, and the default is that you cannot benefit at all without explicit authority given in the governing document, or from the regulator. The rules here are less well understood than many trustees appreciate. In the Charity Commission's 2026 research, 99 per cent of trustees said they were confident in the role, yet only a third recognised that employing a trustee in a paid role creates a conflict of interest, while just over seven in ten correctly identified the dual authorisation requirement on payments.[6](#fn-6) Finally, charity board meetings will most likely take place in the evening, with the chief executive and half the staff in the room, minuted by a volunteer. The formality a corporate NED takes for granted may not exist, and introducing it gently is part of the value you can bring from the private sector. A notable positive point in my experience is that the biscuits served at the charity board meetings are also usually better! ## Some practical guidance for a first-time charity NED So practically, here's the summary of what I suggest to a first-time charity NED. Firstly, read the governing documents carefully and question them. Understand the charity's mission. Ask what the legal form is, and what it means for you personally. Ask what the reserves policy is, and what happens if the biggest donor walks away. Be clear on the drivers of your income. Ask how the board hears from its stakeholders, and when it last changed its mind because of them. Serving on a charity board can be both personally and professionally rewarding, but it is not a training pitch. It is the same game played with less money and with often more at stake. A NED who has experience serving on a charity board arrives at their first company board already knowing how clarity of the organisation’s mission can aid decision-making and prioritization and they bring experience of how to effectively and timely challenge decisions even when the subject is emotive. Next topic in the series: What happens when the board must become the management. In a small charity the trustees are often the only spare capacity. Events like a CEO leaving unexpectedly can result in trustees stepping in, blurring the line between non-executive and executive. I will set out how to cross that line properly, what the risks are, and how to come back safely whilst maintaining your independence and objectivity. --- *Use of AI statement* This article was written by Tom Noel, its human author. AI was used to research background sources, to check quotations and figures against the original documents, and to compile the footnotes. It did not write the argument, the interpretation or any of the original editorial. The article was reviewed and edited by Peggy Curley, Chief Communications Officer, and approved for publication under the NEDness Editorial Policy. **Sources** 1 Royal Shakespeare Company, “We are to conclude our partnership with BP,” 2 October 2019, [RSC website](https://www.rsc.org.uk/news/archive/we-are-to-conclude-our-partnership-with-bp?utm%5Fsource=chatgpt.com). [↩](#fnref-1) 2 Charity Commission for England and Wales, *Charity Inquiry: Keeping Kids Company*, published 10 February 2022, amended 21 May 2025\. [Charity Commission: Charity Inquiry – Keeping Kids Company](https://www.gov.uk/government/publications/charity-inquiry-keeping-kids-company/charity-inquiry-keeping-kids-company?utm%5Fsource=chatgpt.com) [↩](#fnref-2) 3 Charity Commission for England and Wales, “Official report criticises former trustees of Kids Company,” GOV.UK, 10 February 2022, updated 21 May 2025\. [GOV.UK – Official report criticises former trustees of Kids Company](https://www.gov.uk/government/news/official-report-criticises-former-trustees-of-kids-company?utm%5Fsource=chatgpt.com) [↩](#fnref-3) 4 Charity Commission for England and Wales, *Charity Inquiry: The Captain Tom Foundation*, 21 November 2024\. [Charity Commission: Charity Inquiry – The Captain Tom Foundation](https://www.gov.uk/government/publications/charity-inquiry-the-captain-tom-foundation/charity-inquiry-the-captain-tom-foundation?utm%5Fsource=chatgpt.com) [↩](#fnref-4) 5 House of Commons International Development Committee, *Sexual exploitation in the aid sector*, oral evidence, Mark Goldring, Chief Executive, Oxfam GB, 20 February 2018, Q52\. [UK Parliament – Oral evidence: Sexual exploitation in the aid sector](https://committees.parliament.uk/oralevidence/7615/html/?utm%5Fsource=chatgpt.com) [↩](#fnref-5) 6 BMG Research for the Charity Commission for England and Wales, *Research with trustees: 2026*, 8 July 2026\. [Charity Commission, Research with trustees: 2026](https://www.gov.uk/government/publications/research-into-public-trust-in-charities-and-research-with-charity-trustees-2026/research-with-trustees-2026?utm%5Fsource=chatgpt.com) [↩](#fnref-6)