As a charity trustee, you hold a position of trust and responsibility. One of your most fundamental duties is to ensure that your charity operates for the public benefit, not for private gain. This principle is at the heart of charity law and underpins public confidence in the sector. The Charity Commission has recently identified this as a key challenge facing the sector having seen a 23% rise in cases involving alleged abuse of charities for private benefit.
What Is public benefit?
Public benefit refers to the positive impact your charity delivers to the public or a sufficient section of it. It’s the reason your charity qualifies for registration, tax reliefs, and public support. In contrast, private benefit is any advantage to individuals or organisations that is not incidental to the charity’s work. Some private benefit is acceptable, such as paying staff or suppliers, but it must be:
- Necessary to achieve the charity’s aims
- Reasonable and proportionate
- Clearly justified and documented
Why it matters for trustees
- Legal Compliance
The Charity Commission requires all charities to demonstrate public benefit. As trustees, you must ensure your charity’s activities and decisions meet this standard. Failure to do so can result in regulatory scrutiny or even loss of charitable status. - Protecting Reputation and Trust
The public expects charities to act with integrity. If your charity is seen to benefit individuals disproportionately, especially trustees or connected persons, it can damage your reputation and erode donor confidence. - Good Governance
Trustees must avoid conflicts of interest and make decisions that serve the charity’s mission. This includes scrutinising contracts, remuneration, and partnerships to ensure they deliver public benefit. - Stewardship of Resources
Charitable funds are entrusted to you for public good. Prioritising public benefit ensures that resources are used effectively and ethically.
Common risks to watch for
- Trustee or staff benefits that exceed market norms
- Contracts awarded to connected persons without proper oversight
- Activities that serve a narrow group without wider public impact
Practical steps for trustees
- Review your charity’s activities regularly to ensure they align with its charitable purposes
- Document decisions where private benefit is involved, showing how it is necessary and proportionate
- Use Charity Commission guidance to stay informed and compliant
- Declare and manage conflicts of interest transparently and robustly
Your role as a trustee is to safeguard the charity’s mission and reputation. By keeping public benefit at the forefront of every decision, you help ensure your charity remains trusted, effective and compliant.
If you need any further advice or have any questions about your role as a trustee, please don't hesitate to get in touch.