The Regulator for Charities in England and Wales
There is a growing expectation that all sections of society should start taking action to prevent climate change. To discuss what role charities could have in improving their environmental responsibility, the Charity Commission hosted a half-day seminar on 18 October 2007 for charities which have shown an interest in increasing the sustainability of the way they work.
As a precursor to the event, our Chair’s article in the October edition of Charity Finance magazine examined the Commission's role in encouraging environmental best practice in the sector and this proved a great catalyst for the lively discussions held during the event. A range of speakers from across the sector told the 30 or so attendees about innovative work they have been doing - both in terms of 'in-house' administrative measures and activities which further charitable purposes.
The Commission would like to thank everyone who attended and contributed to the conference, particularly the charities who gave presentations.
We structured the day around two main sessions.
During the first part of the morning we explored the extent to which it is a legitimate use of charitable money for charities to take in-house measures to improve the environmental responsibility of the way they work within their premises. Many of these measures will reduce costs for a charity (for example shutting PCs off at the end of the day, or lowering thermostats) and arguably they should be taking these measures in any event to ensure the effective use of their resources. Where a cost is involved, we think it’s reasonable for trustees to do this where they have balanced the additional cost of environmental measures against other relevant factors such as benefits to their reputation and donor confidence. As long as trustees have considered the risks of each option and reached a rational decision, they are unlikely to be criticised. To bring out the key messages, we heard from three speakers:
Carbon Trust
During this session we heard from Keri Jordan of the sustainability consultancy organisation, BRE, which has been tasked by the Carbon Trust to produce a booklet aimed specifically at charities, looking at measures they can take in-house to improve energy efficiency. Keri gave a brief overview of the current outline for the booklet which looks at issues such as heating, lighting, office equipment and ventilation, and discusses how costs can be kept down while energy efficiency is improved. Delegates were given copies of the draft booklet and asked to feed back directly to Keri after the event. The Carbon Trust expect to publish the leaflet in early 2008.
RSPB
Martin Harper, Head of Sustainable Development at RSPB, outlined measures recently implemented by the RSPB. He explained that a crucial part of RSPB’s strategy is to protect birds through an improved environment, and this includes looking at the charity’s own environmental impact. Recently, the charity has set itself new targets for carbon emissions, which it aims to meet by setting carbon budgets for the whole organisation. The challenges RSPB have faced included establishing what level the quotas should be and introducing and refreshing policies for reducing emissions. When deciding on investment the trustees have had to make decisions based on the need to balance costs with outcomes.
Every Action Counts
Mark Walton, Head of Every Action Counts outlined their work to promote environmental responsibility and the Third Sector Declaration they are asking organisations to sign up to. The initiative is designed to help community groups and clubs across the country become “future-friendly” by promoting environmental sustainability. Mark Parker, Head of Development at BASSAC, then spoke on the work EAC had done with BASSAC, giving examples of some of the initiatives taken and ways in which staff were encouraged to become engaged with the project. BASSAC is now promoting the action plan with their member bodies, and making sure sustainable development is included in their long-term development by integrating it into their strategic planning.
View Every Action Counts (PDF) and Bassac’s (PDF) presentations.
We were delighted that the presentations led to a lively and wide-ranging discussion of the issues, the key themes of which are drawn out below. Please note that this is a summary of the discussions held on the day and does not necessarily reflect the opinions of the Charity Commission or the wider charity sector, nor is this an exhaustive list of all of the issues.
The delegates identified a number of factors which they have found to be key in embedding change. Below is a summary of the points delegates raised:
This session included three presentations:
Emma Knuckey, Legal Adviser at the Commission, set out the legal framework which needs to be considered by charities undertaking environmental projects.
The law requires charities to act within their objects, which means that all of their assets have to be used to further those objects directly or indirectly. Charity trustees also have a duty to maximise their charity’s resources.
However, trustees also need to consider their reputation amongst donors and other stakeholders. As ‘green’ issues become more prominent, charities will become increasingly expected to demonstrate how they are environmentally friendly and may risk reputational damage and reduced donor support if they cannot.
It seems likely that environmental issues will have an increasing impact on the law. For example, the Companies Act 2006 imposes a new duty on directors of charitable companies to have regard to the impact of the company’s operations on the community and the environment when acting to achieve the company’s purposes. The duty only directly applies to directors of charitable companies, but it may be that in due course the principle will be considered to apply to unincorporated charities as well.
When considering whether environmental projects are within a charity’s objects, we would encourage trustees to explore the full scope of their objects, without acting outside them. The key point to note is that, if challenged, charity trustees must be able to demonstrate, with evidence, the link between the activities and how their charitable purposes are being fulfilled.
Some examples of charities which do not have objects for the preservation of the environment, but may nevertheless carry out environmental work which furthers their existing objects could include:
Some charities may want to take things a step further and adopt an additional environmental-related object. Unincorporated charities are likely to require a scheme from the Commission in order to change their objects and would need to satisfy the ‘cy-près’ test under section 13 of the Charities Act 1993, The amendments to the cy-près provisions introduced by the Charities Act 2006 (which are expected to come into force in February 2008) sets out that the current social and economic circumstances are appropriate matters to be considered when an unincorporated charity applies for a cy-près scheme. The meaning of ‘social and economic circumstances’ is not defined in the Act, but it is certainly possible that environmental issues may be of relevance here.
Charitable companies must apply to the Charity Commission for consent to amend their objects under section 64 of the Charities Act 1993.
We are happy for charities to contact us for further advice and guidance as to the scope for undertaking green projects.
See the Charity Commission’s presentation (PDF).
Clare Thomas, Chief Grants Officer at The City Bridge Trust outlined recent work the charity has undertaken under the third strand of its objects - ‘other charitable purposes for the general benefit of the inhabitants of Greater London in such ways as the trustees think fit.’
This work has included the ‘eco-audits’ they have carried out on a number of charities they had given grants to, the findings of which were published in their report, Greening the Third Sector’. The author of the report, John Merivale, outlined that the main obstacles they had found were the absence of a clear environmental policy, lack of awareness, shortage of funds, as well as practical obstacles, such as occupying rented accommodation.
View City Bridge Trust’s presentation (PDF).
Dame Elizabeth Hoodless, Executive Director of Community Service Volunteers (CSV), outlined a number of CSV’s environmental initiatives. CSV’s objects are to ‘provide further education for men and women by encouraging and enabling them to undertake voluntary work in education, social services, the environment or similar activities in various parts of the world…’. CSV runs a number of environmentally-themed programmes which are intended to enable local action and volunteering, and promote awareness of the issues through engaging with local communities. They have also introduced a number of interesting initiatives such as their the annual ‘Make a Difference’ day to encourage volunteering and the ‘Action Earth’ project which runs from January to June each year, giving out grants of £50 to over a thousand environmental projects.
View CSV’s presentation (PDF).
The delegates identified a number of factors which they have found to be key in motivating organisations to carry out environmental activities as an integral part of furthering their existing objectives. Please note that this is a summary of the discussions held on the day and does not necessarily reflect the opinions of the Charity Commission or the wider charity sector, nor is this an exhaustive list of all of the relevant issues.
Below is a summary of the points delegates raised:
See a set of Questions and Answers aimed at charities thinking of getting involved in environmental work?