Scottish charity law: consultation analysis

Section 2

An internal database and external register of charity trustees

Context 

OSCR currently holds limited information on the 180,000+ charity trustees involved in over 24,000 charities in Scotland.  The law only requires the Scottish Charity Register to set out the principal office of the charity or the name and address of one of its trustees.  The option proposed is for OSCR to establish a new register of trustees to provide valuable and relevant information to better support effective regulation of charities and their trustees, through improved compliance, investigation and engagement work.  The proposals include: 

• An internal database for OSCR’s use only i.e. name, date of birth (for identification purposes), home address, email address.  This register could also include the names of any person removed as a trustee following an inquiry by OSCR under the 2005 Act or preceding legislation.
• A reduced external register for public use.  This could contain trustee names (including removed trustees) and a principal office or trustee contact address against each charity.

Table 9: Question 4

Should OSCR be able to collect the trustee information noted above for use in an internal database?

	Yes	No	Not Answered	Total
Individuals	85%	13%	2%	127
Charity Sector	75%	13%	12%	164
Other	81%	0%	19%	16
Total	79%	13%	8%	307

Note: Percentages have been rounded therefore percentage totals may not equal 100%.

The majority of respondents reported that OSCR SHOULD be able to collect trustee information for use in an internal database (79%).  Highest levels of support were among individuals and other sub-groups (including regulators).

Only 13% of respondents reported that OSCR SHOULD NOT be able to collect trustee information for use in an internal database.  

Table 10: Question 5

Should the names of trustees be published on the external public register?

	Yes	No	Not Answered	Total
Individuals	75%	24%	2%	127
Charity Sector	67%	21%	12%	164
Other	75%	0%	25%	16
Total	71%	21%	8%	307

Note: Percentages have been rounded therefore percentage totals may not equal 100%.

Some 71% of respondents SUPPORTED the proposal for the names of trustees to be published on the external public register.  Support was strongest among individuals and other (including regulators) sub-groups.  Within the charity sector there were higher levels of support among national charities and membership/ professional bodies.

Around one-fifth of respondents felt that the names of trustees should be EXCLUDED from the external public register (21%).  Of note was the high level of support for excluding such information among local charities. 

Table 11: Question 6

Should the names of trustees who have been removed following an inquiry by OSCR, be published on the external public register?

	Yes	No	Not Answered	Total
Individuals	86%	12%	2%	127
Charity Sector	76%	12%	13%	164
Other	69%	0%	31%	16
Total	79%	11%	9%	307

Note: Percentages have been rounded therefore percentage totals may not equal 100%.

The majority of respondents reported that the names of trustees who have been removed following an inquiry by OSCR SHOULD BE PUBLISHED on the external public register (79%).  Support was highest among the individuals sub-group.

Only 11% of respondents felt that the names of trustees who have been removed following an inquiry by OSCR SHOULD NOT BE PUBLISHED.  Local charities were more likely to answer “No” to this question.

Table 12: Question 7

Do you think trustees should be allowed to apply for a dispensation (exemption) from having their name published on the external public register?

	Yes	No	Not Answered	Total
Individuals	53%	43%	4%	127
Charity Sector	62%	23%	15%	164
Other	63%	19%	19%	16
Total	58%	31%	11%	307

Note: Percentages have been rounded therefore percentage totals may not equal 100%.

Some 58% of respondents thought trustees SHOULD be allowed to apply for a dispensation from having their name published on the external public register.  There was stronger support among other and charity sector sub-groups.  Within the charity sector, there was stronger support among national charities and membership/professional bodies.

The main themes that emerged from the feedback provided by these respondents can be grouped as follows:

• Trustees should be allowed to apply for a dispensation, however, the decision on whether or not this was granted should rest with OSCR.  
• There should be a process put in place whereby a trustee has rights to appeal and challenge a decision not to grant a dispensation.
• It would be imperative that OSCR clearly defined the parameters where a dispensation might be applied for, that the number of dispensations was reported on, and that any dispensations were reviewed regularly.
• The publication of trustee names should be the default position, and dispensation should be by exception, and considered by OSCR on a case-by-case basis.

That being said, most of these respondents felt that there might be a limited and specific set of legitimate circumstances where an exemption should be granted:

• In instances where disclosure could put a trustee (and/or their family) at risk of unwelcome exposure from a health, safety or security perspective.  Certain types of charities were mentioned, including those who dealt with sensitive areas/activities, and charities that operated in small geographic areas or out of a single location.
• In instances where disclosure could impact on an individual’s privacy and contravene GDPR regulations.
• An exemption should be granted for trustees who were former or current service users and might be considered “vulnerable” in some way.

Many of these respondents stressed the importance of contact information (i.e. personal identifying information beyond trustee name) only being available on the internal database for OSCR’s use, and that appropriate safeguards must be put in place to prevent any data breaches.  

Wider feedback from some respondents related to the extent to which publishing trustee names (but more so other personal identifying information) might make people less willing to become involved in charities as a trustee. 

Almost one-third of respondents thought trustees SHOULD NOT be allowed to apply for a dispensation from having their name published on the external public register (31%).

Individuals were more likely to report that trustees should NOT be allowed to apply for a dispensation.  Within the charity sector, there was strongest support among local charities.

The main themes that emerged from the respondent feedback was that:

• Individuals involved in the governance of charities should be “visible”, and that the public had a right to know who is involved in running charities.
• That not being able to apply for a dispensation would strengthen accountability, transparency, and build public trust in the sector.  Full disclosure was considered important from a good governance perspective.
• This information was already published in charity annual report and accounts, and in most cases available to the public on a charity’s website (or via direct request). 
• That not being able to apply for a dispensation might prevent fraudulent activity and be a deterrent for any wrong doing or possible criminal activity.

The final question invited comments to any of the questions in Section 2
(i.e. Question 4 to Question 7).

Note: The feedback was not specific to any question, and as such, the following presents our overall analysis of the comments provided.

The proposals outlined in Section 2 attracted relatively mixed feedback from respondents.

Among those respondents who took the opportunity to put forward their general support for the proposals, it was felt that an internal database and external register of charity trustees would help to “increase public confidence in the governance of charities”.  

Wider benefits reported by many of these respondents included that the proposals would: 

• Increase transparency and openness of the charity sector in Scotland. 
• Support effective regulation of charities and their trustees.
• Reduce fraudulent behaviour within charities or mismanagement.
• Support due diligence activities e.g. when charities recruit new trustees.

Other benefits reported by some of these respondents was that the proposals would bring Scotland into line with the rest of the UK, and that some of this information was already in the public domain.

While these respondents expressed their overall support for the development of an internal database and external register of charity trustees (including in a searchable format), a number of process-related issues were raised:

• Robust systems and processes would be required to ensure that data protection requirements were adhered to, and access to information on trustees was tightly controlled.  Personal data should only be held where there is a clear purpose for doing so and for a specified period of time.
• Privacy of data was emphasised (i.e. no personal details over and above trustee name for external register).  Plus, a handful felt that publishing too much information might deter potential candidates from becoming trustees.  However, others felt that this could be mitigated through clear messaging as to why the information was required and how it would be used.
• Linked to earlier questions, the importance of there being a right to apply for a dispensation from publishing details on the external register was raised.

Wider feedback from some respondents included:

• There were felt to be inherent challenges around keeping the information up-to-date.
• The importance of keeping the administration burden of providing/updating information and data to a minimum was emphasised, and for smaller charities in particular.
• A few identified the need for more information on why the internal database was needed, how the information would be used and managed, how long information would be retained for, and who it might be shared with.
• Cross-border charities felt that it would be more practical to limit this proposal to charities whose principal regulator is OSCR.

• Some points were raised around publishing the names of removed trustees – that this should be a separate register; that it should be time-limited (in most cases); that there would need to be background context about the decision; that care would need to be taken to avoid mistaken identity (e.g. trustees with the same name); while a few questioned how helpful this approach was for someone trying to recover from a previous misdemeanour.

Where respondents DID NOT support the proposals in Section 2 and/or expressed some concerns, three main points were raised:

1. That OSCR had not put forward a strong or robust enough justification for the proposals.  For example, queries raised included: why was the internal and external register of trustees needed; how would personal information be processed, stored, protected, controlled and used; and more detail was required on the anticipated benefits of the proposals.

2. There was felt to be a lack of clarity on the added value of the proposals.

3. There was felt to be a lack of clarity around how the proposals would be implemented, and how it would work in practice.

The concerns raised by these respondents largely reflected those provided previously as part of OSCR’s 2014 Targeted Regulation consultation, namely:

• Privacy of data concerns, including GDPR considerations.
• There was felt to be a lack of detail around how information would be safeguarded from data breaches, and that there would need to be additional reassurances provided around data security.
• The cost of maintaining the database, and inherent challenges around how the information could routinely be kept up-to-date.
• That providing the information could create an administrative burden for charities (and for OSCR).
• That publishing trustee names on an external register might put trustees at risk and/or discourage others from applying to become a trustee.
• That due care would need to be taken in publishing the names of trustees who had been removed following an inquiry by OSCR – to avoid mistaken identity.

While not mentioned to any great extent, it was proposed that contact be made with Digital Identity Scotland to develop a more “nuanced proposal” that would provide OSCR with the information it needed while ensuring alignment with the Scottish Government’s “emerging approach to online identity assurance”.