Understanding the Role of UK Nonprofit Board Members.

4th June 2024

Nonprofit organisations are an essential part of British society. Many of them offer life-changing services to the most vulnerable in our communities. As of May 2024, official figures show there are over 184,000 charities in the UK, with more than 924,000 trustees. 

You may have talents and time that you would like to spend working for a worthy cause, possibly in an oversight role. Yet, you may be wondering, do nonprofit board members get paid? If not, is it possible to make this work with my other commitments?

In this article, we'll examine in depth the type of compensation that may be available to nonprofit board members. We'll also explore members' responsibilities, helping you decide whether this could be a good way to give something back.

Do Nonprofit Board Members Get Paid?

The simple answer is usually no. 

Nonprofit board members, often known as trustees in the UK, are typically unpaid volunteers. However, there are some exceptions, including:

·       Where approval has been given by the courts

·       When the charity's governing document permits it

·       When the Charity Commission allows it

Expenses for Nonprofit Board Members

Nonprofit laws recognise that trustees deserve to be reimbursed for certain expenses encountered as they carry out their duties. These include:

·       Travel expenses in connection with board meetings

·       Overnight accommodation

·       Childcare/other care costs while attending board meetings

·       Telephone, postage, and internet expenses connected to the charity's work

Nonprofits must have a written agreement that sets out what expenses are allowed and how to claim them. 

When Trustees Provide Goods or Services

Another exception may occur if a nonprofit board member provides work or services for the charity that go beyond their duties as a board member. 

Some examples may include:

·       Work such as painting, plumbing, or electrical services

·       Providing specialist services, such as IT consultancy

·       Administrative work

·       Occasionally providing premises or facilities for the charity's use

Check the Guidelines First

However, before paying a nonprofit board member, it is essential to check the guidance of:

·       The Charity Commission for England and Wales

·       The Scottish Charity Regulator, or

·       The Charity Commission for Northern Ireland

These guidelines set out the types of compensation that can be paid and how to show the payment is in the charity's best interests. These regulations also show that payments to trustees would be the exception rather than the rule. Making payments to half, or more than half, of the board is forbidden.

Of course, this does not mean that nonprofit salaries do not exist. If you want to pursue a career in the charity sector, many remunerated roles allow you to make a difference while earning a living. However, if you decide to become a board member, you should do so with the expectation of not being paid for the services you render.

Nonprofit Board Member Responsibilities

Charity trustees are typically passionate about the charity's work. They come from all professional backgrounds and walks of life, and this diversity can enrich the board.

Nonprofit board member responsibilities can be wide-ranging and come with a level of personal accountability.

Fulfilling the Charity's Purpose

Primarily, trustees are responsible for ensuring that the charity is following through on its stated purpose and is not doing anything else. Nonprofit board members must create a plan to this end and produce a rationale for how the charity's activities will further this purpose and benefit the public.

Comply With the Law

Charities have a governing document and UK law to comply with. While nonprofit board members are not expected to be legal experts, they must seek relevant guidance and take steps to ensure they are compliant. They must also comply with the law around hiring practices while getting the right people in place.

Manage the Charity's Resources Carefully

Financial transparency is key when acting as a nonprofit board member. Every financial decision must be measured, and not take risks with the charity's funds or its reputation. Particular care must be taken when investing or borrowing on behalf of the nonprofit.

Act in the Best Interests of the Charity

Acting as a trustee is a selfless act that involves personal sacrifice for the public good. The board's decisions must be in the charity's best interests in the short and long term.

Nonprofit board members must avoid situations where their duty to the charity conflicts with their personal interests. This includes not receiving personal benefits from the charity unless clearly authorised. This would also extend to anyone financially connected to you.

The Importance of Financial Transparency for Nonprofit Organisations

The public rightly has high expectations of charities. Research conducted by the government in 2022 highlighted four key expectations:

·       A high percentage of the money the charity raises supports charitable activities

·       The charity is following through on its promises

·       Their decision-making reflects the spirit of charity

·       They uphold the general reputation of charity in how they discharge their responsibilities

This research also found that public confidence in charities was 6.2 on a scale of 1-10. Trust levels have dropped from a high of 76% in 2012 to just over 50% in 2022. These statistics highlight how important it is for charities to maintain public confidence through financial transparency.

What You Can Gain From Being a Board Member

Although nonprofit board members do not get paid, there is still much to gain from being a board member. This could include:

·       Opportunity to develop leadership experience

·       Expand professional network

·       Give back to the community in a meaningful way

·       Share professional skills you have that can benefit others

Therefore, do not be quick to dismiss the opportunity of joining a nonprofit board if it comes along. The skills and experience you gain could open opportunities in the nonprofit sector for salaried roles in the future.

Recruit the Right People for Your Charity

While the answer to "do nonprofit board members get paid?" is usually no, there are many other salaried roles to fill. Charities need to attract the right executives for director and CEO roles to keep their causes moving forward.

AAW Group is here to help you recruit top talent that can spur your charity on to new heights. Tap into our huge network of experienced and talented directors and CEOs who could make a difference for your charity.

Learn more about our recruitment services and call us on +44 (0) 7586 812 075 to discover what we can do for you.