Question

Hi,

We are in the process of looking at re-structuring our organisations and would value any advice you might be able to offer. 

Currently we have had the business and charity working in tandem, but we now feel it will make more sense to re-structure so we just have one charity and no business. 

Our confusion comes around governance and staff. Myself and my husband are the founders of the organisation, all of the networks and relationships with projects come through us. We need to be able to direct the organisation and run it on a day to day basis, however if we are to do this we cannot be paid a salary and be trustees. Are you able to offer any advice as to the best way to organise things so that we can continue to run the organisation, eventually receive a salary but also work within the correct governance procedure. One solution we were considering was if my husband did not receive a salary but remained as the Chairman and I stepped down from being a trustee and was simply classed as a staff member of the organisation reporting to the board. Do you feel this would be a viable solution?  Are there any other options you could suggest? 

Many thanks for your time and assistance, it's a big step and we want to get it right :) 

Kind regards, 
Rachael. 

Comments

paul.meade's picture

Hi Rachael,Thanks for your

Hi Rachael,

Thanks for your question. I've talked to a couple of colleagues here (including Deirdre Garvey, our CEO) about it and they've recommended the following:

First question is why would you want to set charity? Going that route imposes a lot of restrictions and so, unless there is a good reason, we'd suggest leaving it as a non-charity.

Note that in a legal or governance sense, there is no such thing as a 'social enterprise' (which is where your organisation might possibly sit, in general terms). Social enterprise is essential a 'marketing term' that some people use. In the eyes of the law and the taxman, however, there is either a company that is not a charity and a company that is a charity (in this instance 'charity' means having charitable status from Revenue Commissioners).

If you want to proceed with being a charity, then it would be fine for one of you to be the Chair (with no salary), and the other to be the CEO (with a salary). Being husband and wife, it would be best practice to have your private relationship explicitly stated in the 'Register of Directors Interests' or in a 'Conflicts of Interest' listing (not that it is a conflict of interest per se, but it is a potential one… hence the need for transparency on their relationship in some manner). 

The membership of the company (under company law) elects / appoints the board of directors. There are two models for this: 1) the members of the company are the same people as the directors (Barretsown is an example of this type); and 2) the members of the company is a much larger grouping that the members of the board (The Wheel is an example of this type). Both are valid. 

For a new organisation, it will likely be you two picking colleagues / friends etc to be on the board and so you may well end up probably opting for model number 1, which would be fine.

We are not really sure of any other structure or format that could be used. The main thing is to follow all the questions posed in the Goverannce Code and to ensure that there is complete transparency about the way the org is run, 

You can learn more about the Governance Code, and the various steps entailed in complying with it, here: www.governancecode.ie

We hope that helps!

Paul