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This guide is aimed at Chief Executives, managers and trustees. It outlines how organisations with a national body and local groups can work together. They may be separate organisations together forming a federal structure or may legally all be part of one organisation with a branch structure.
The model describes good practice for such organisations - in new or existing structures – with a particular eye on areas where shared understanding of structure can help avoid common pitfalls.
National voluntary organisations may operate solely from one centre or they may have local bases across England, or the UK. Organisations with this combination of a national body and local presence may work collaboratively in a federal structure or in a branch structure.
Organisational structures often develop organically over time. However complex and varied the structures that emerge, many of them improve outcomes for beneficiaries by combining the ability to co-ordinate national activities, such as campaigning, with the flexibility to respond to local needs that may vary over a wide area.
When relationships between parts of a network break down, the effects can be time consuming and damaging so it is worth giving time and resources to managing relations effectively.
The local organisation may be known as a local group, a branch, an affiliate or a member organisation. This model uses the terms, local group and national body, irrespective of the structure they belong to. It uses networks to refer to both federal and branch structures. The case studies use each organisation's own terms. The terms 'federal' and 'branch' themselves are often used interchangeably and for widely varying structures.
Organisations which comprise both a national body and a number of independent local groups have a federal structure. The national body may retain some control over the local groups, but on other issues, the local groups have autonomy (a set-up with parallels to a franchise in the private sector). There should be no fundamental difference between the charitable objects of the organisations in such a network, although their geographical area of benefit will vary.
A branch structure is constitutionally one organisation. It comprises a national organisation with regional or local branches. The branches are part of the national organisation and share its governance structure and charitable aims.
Branches which form part of one organisation may also be known as local committees, supporters' groups, friends' groups, members' groups, communities or parishes.
Federal and branch structures provide organisations with a balance between national presence and grassroots involvement. The benefits of this combination may include:
Federal and branch networks are complex structures dependent for success on good governance, management and communication skills – all of which take time, effort and resources. Potential areas of difficulty may include:
Effective governance and communication are key to successful working relationships between national bodies and local groups. Trustees need to keep under review how an organisation's structure can help it achieve its aims for beneficiaries.
Typically, the objectives of national bodies specify that they provide advice and guidance to local groups. Local groups' objectives usually focus on helping clients locally. Organisations are failing their beneficiaries if they do not fulfil the charitable aims laid down in their own governing document.
It is trustees' decision how far to embed the roles and responsibilities of organisations in their governing document. Otherwise, they should be set down in writing elsewhere. Shared understanding of where roles and responsibilities lie will help minimise potential confusion and conflict, among staff, volunteers, beneficiaries and other stakeholders.
Your governing document is the starting point for how you disseminate understanding of roles to people in the different parts of the network. You should explain organisational structure in plain language and point out its implications for the way that people work together. Local groups may be required to sign up to such procedures.
As part of its focus on benefit to the client, Relate has developed and circulated a list of definitions, describing parts of the Relate Federation and how they relate to each other. This helps ensure that everyone is clear on how different parts of the Federation contribute to its charitable aims.
Don't ignore the human element in managing a network of organisational relationships. Misunderstandings can escalate into serious problems so two-way communication is vital. Mediation can be the answer to internal disputes, but there are costs involved and prevention is better than cure. A transparent, consistent management style and explanation of decisions made by the national body can counter perceptions of unfair treatment.
Most local groups in both federal and branch structures can fundraise for themselves and keep the money that they raise to use in their local area. But sometimes a national body may fundraise in the area of a local group. It is essential that fundraisers can explain which part of their network they are fundraising for and make this clear in fundraising material. Without clarity on the destination of the money raised, there may be auditing problems at year end.
Where federal or branch organisations are approaching trusts, foundations, corporates or statutory funders, they risk overwhelming them with similar applications. To avoid duplication:
Fundraisers across the organisation need to maintain regular contact to ensure they have a consistent approach, from paid staff in the national body to street collectors supporting local groups.
Governance arrangements in federal and branch organisations can vary considerably, but must always take into account what is most effective for the organisation's beneficiaries.
These options can confuse local trustees who also sit on a national board - where should their allegiance lie? Having a local trustee at national level may not bring a local voice into national decision-making because trustees cannot be mandated to represent particular interests.
Nevertheless, trustees on a national board who are informed by local experience can improve:
Different skills may be required for governance at different levels. Where local groups nominate new trustees for the national body, it is helpful if organisations can provide:
Charity trustees have a legal obligation to carry out risk assessments. In federal structures, this responsibility lies with the trustee body of each charity. Where an organisation has only one set of trustees, the responsibility for risk assessment lies with them. It includes risks associated with the national body itself and its local branches.
In federal structures, legal title to property is held by each separate organisation. In branch structures, legal title to property across the network is often held by the national body, but individual situations vary. This is a complex area where Charity Commission advice is recommended, particularly if organisational structure changes or local groups close.
Improving services to beneficiaries is the ultimate reason for changing an existing structure or developing a new one. The Charity Commission recommend that organisations contact them early on for advice on legal and regulatory issues.
A steering group to give direction to your restructuring should be representative of all stakeholders - volunteers, staff, members, trustees - from across the country.
Explain the proposed changes to stakeholders, including the reasons for them and their implications, as local groups may fear losing influence. When Diabetes UK set up regional offices, it disseminated a ten year vision for the organisation to its internal audiences to put the structural changes into context.
Last reviewed: 15 March 2016Help us improve this content
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