Enhancing governance and transparency for charities in Singapore

1. The Charity Council (“Council”) has released its refined Code of Governance for Charities and Institutions of a Public Character (IPCs). The new Code will take effect for financial year commencing from 1 January 2018. The Code aims to strengthen the governance practices of charities in Singapore, and enable them to be more transparent and accountable. To support charities in their implementation process, the Council and its partnering agencies will be rolling out a series of learning initiatives and enablers. Funding will also be made available through the VWOsCharities Capability Fund (VCF) to help charities build up their governance capabilities.
   

Feedback form an integral part of the review

2. Stakeholders’ feedback is an integral part in the review of the Code. Four dialogue sessions were held with over 183 charities and IPCs across various sectors, followed by a four-week long public consultation. Most respondents were generally supportive of the proposed refinements, with some expressing different views, in particular, concerning Board term limits. Many acknowledged that good governance is a continuous work in progress and is key in ensuring sustainability of their good works.

Key refinements to the Code

3. The Council has carefully weighed the different perspectives put forward during the consultation process and made further modifications to the proposed guideline relating to term limits for board members. The new guideline now requires charities to disclose the reasons for retaining Board member(s) who have served on the Board for more than 10 consecutive years₁. The intent of this guideline is to encourage charities to practice succession planning at the board level. Other key refinements to the Code which were supported during the consultation process are:

   1. Definition of charity size to be determined by “Gross Annual Receipts₂ or Total Expenditure₃, whichever is higher, in each of its two immediate preceding financial years;

   2. Removing the ‘Not Applicable’ option in the Governance Evaluation Checklist (GEC). The Code operates on the principle of ‘comply or explain’;

   3. Waiving the GEC submission requirement for small charities that have gross annual receipts or total expenditure of less than $50,000;

   4. Elevating the disclosure of information on Board members, such as their attendance at meetings and remuneration; and information of staff total annual remuneration, among others; and

   5. Introducing Risk Management, to ensure that there is a process to identify, monitor and review charities’ key risks.

4. Mr Gerard Ee, Chairman of Charity Council, expressed his appreciation to the Code of Governance Refinement Sub-Committee and its three workgroups, charity practitioners and all stakeholders who contributed to the refinement process. He also assured the charity sector, “The Charity Council will work closely with all charities in this journey, so that we can achieve our shared vision of a well-governed charity sector in Singapore. I hope the public will continue to support the charity sector so that charities can continue their good work and help those in need.”

5. The Code is available for download on the Charity Portal (www.charities.gov.sg) and the Charity Council website (www.charitycouncil.org.sg).