“Being accountable is a fiduciary duty. Being transparent is building trust and confidence.” Woo E-Sah, Industry Lead, Not-for-Profit Practice, RSM Singapore
Charities today are disclosing more about their programmes and outcomes, and they are getting more transparent than before – increasing awareness of their activities for donors to make informed decisions. But the question remains: How much is adequate or enough to build donors’ confidence and trust?
At the annual Charity Governance Conference organised by the Securities Investors Association (Singapore) or SIAS held on September 30, Woo E-Sah, Industry Lead of RSM’s Not-for-Profit Practice, asked whether charities should go beyond regulatory compliance to disclose more to provide donors and stakeholders with greater confidence that they have robust governance and risk management.
Before the workshop conducted by E-Sah, RSM surveyed a number of managements and Board members of charities for their views on certain suggested additional disclosures. Many were supportive of it. However, a review of the latest annual reports of 20 charities found that these disclosures were not reported. The suggested additional disclosures are:
- Table of key risks and how they are being managed or mitigated
- Process for orderly renewal of Board and key office bearers
- Process for regular review of Board composition, diversity, and skillsets
- Process for performance evaluation of the Board, committees, and directors
- Audit committee’s comments on the internal audit function are independent, effective, and adequately resourced
- Significant matters raised through whistleblowing
- Whether the reserve requirement has been met
- Negative assurance on material non-compliance with funding conditions
- Negative assurance on material non-compliance with standards and regulations
- Steps that were taken against cyberthreats, and compliance with PDPA regulations and COVID-19 safety measures
At the workshop attended by more than 500 participants, a poll was also conducted and a large majority of those responded to the poll indicated their support for the suggested additional disclosures.
Beyond Fiduciary Duty
It is clear that charities need to be prepared to go beyond basic fiduciary duties of disclosure to adopt a more proactive and transparent approach to win over stakeholders and donors.
To find out more and how our Not-for-Profit Practice team can assist you, please reach out to our specialists.
Partner & Industry Lead
T +65 6594 7843
Senior Director & Deputy Industry Lead
T +65 6594 7892