The Corporations and Markets Advisory Committee (CAMAC) today [Thur 30.5.2013] released its report Administration of charitable trusts. This report deals with administrative arrangements for charitable trusts managed by licensed trustee companies (LTCs). The terms of reference do not include charitable trusts administered by other persons, or other types of charitable entities.
CAMAC’s starting point was to ask why donors set up charitable trusts in the first place. CAMAC considers that the primary intent of a donor is to achieve the benevolent and philanthropic purposes or objectives for which that person established and funded the charitable trust, within the time frame of the trust, and in an effective and efficient manner. Administrative arrangements for operating a charitable trust should be assessed according to the extent to which they advance or promote that primary intent.
Recommendations made include:
that the ACNC conduct, or coordinate, Stewardship audits of a cross-section of charitable trusts administered by LTCs. The purpose of these audits would be to overcome the present deficit of relevant and indisputable information on the state of administration of charitable trusts, including the extent to which each trustee has assumed its responsibilities and exercised its powers for the purpose of achieving the primary intent of the donor;
the introduction of a statutory “fair and reasonable” requirement for all fees and costs charged against a charitable trust;
changes to the judicial dispute resolution procedures to enhance access to the court, and to broaden the court’s remedial powers, including in regard to whether fees and costs charged against a particular charitable trust are excessive or whether an LTC should be replaced as the trustee of a particular charitable trust.
Source: CAMAC release, 30 May 2013
[LTN 103, 30/5/13]