Trustees: Making Beneficiary Decisions for Business Success

For a business to be successful, beneficiary decisions must be made expertly. The purpose of making these decisions is entrusted to the trustee of the company. According to Barone, a trustee is a firm or a person that manages assets or property to a third party's benefit (2019). A trustee might be chosen for charitable purposes, to deal with bankruptcy or for specific retirement plans and pensions. They are expected to put aside their goals and concentrate on their roles to snatch the best results from the trust. The main aim of this paper is to discuss the roles of trustees concerning good governance and social businesses. Besides, the paper analyses how to ensure best practices are obtained in this area.

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Roles of Trustees on social businesses

Integrity is the primary role in any trustee's document that governs their charity work. The trustees are supposed to advance regarding their charitable purpose. Their charity acts should meet their charitable purpose only and should be beneficial to the public. All this becomes successful when the trustee clarifies the visions of the organization to everyone by providing a written plan of the firm that anyone involved can view. To achieve the best results in this section, the trustee must maintain a high level of integrity (The Scottish Council for Voluntary Organisation, 2018). A person cannot be chosen to become a trustee if he has been accused of dishonest cases, has a poor background in handling bankruptcy cases, or the person has been charged with fraud activities in the past.

Leadership is an essential aspect of any organization. Trustees should have the skills required to lead people. They are given the responsibility of guiding the people involved; that is, the contractors, the volunteers, and the other employees (Justia, 2017). Trustees have a legal right to ensure that the employees receive all the written terms of the organization's employment, consulting with the staff about the health facilities in the organization, the level of security, also consider insurance liability of the employee is in place. To improve the leadership condition with the staff, the trustees should ensure that a healthy relationship is maintained with the employees and avoid very close prose with them.

Assets or properties should be fully utilized to the maximum and distributed according to the instructions from the trust. The trustee should be familiar with the interests of the involved beneficiary organization, balance the current needs of the beneficiaries to the ones in the future. They should communicate regularly with the beneficiaries concerning important information that might affect the organization's assets (U.S. Trust, 2016, 3). Trustees should only ask for assistance from their co-trustees when they have a problem in handling some assets, or they have a problem in distribution to avoid exposure to the organization's assets. Some assets might be looted, causing a questioning of the trustee's honesty. To prevent this, the trustee should ensure that the level of security is at the maximum level.

Dependency and transparency are critical aspects of the trusteeship community. Charities are obligated to being transparent; that is why they are entrusted in handling public funds that are in the form of grants from government and donations from the public. They have a mission in benefiting society. That is why they are so accountable in their operations (Barone, 2019). This makes them have a communication challenge since they must communicate with the people that are interested in their activities, the changes that their organization brings to the community, and the methods of spending the public funds entrusted to them. Trustees should make a good relationship with their stakeholders; by responding positively to their questions and giving feedback regularly.

Risk management and financial oversight helps a business to grow effectively. Every trustee has the role of exercising control where they uphold their legal commitment of their charity. It is necessary that charities engage in the activities of managing risks for the beneficiary. The trustees must be up to date with new forms of handling risks in an organization (The Wheel, 2019). When the risk is managed then losses will become very rare in the business. It is always recommendable that organizations strategically handle their risks, and the board of trustees should help them in making that possible. This will make the organization have the ability to identify their significant dangers and their opportunities that might cause a rise in the rate of profit earned.

Conclusion

Indeed, it is clear that trustees have several roles, which makes their operations unique and useful also, it is seen how they can improve their trusteeship work. It is learned that trustees need a good relationship with their employees; this will make their job of leadership easier. A good relation will create respect between the trustee and the employee. Trustees should be honest with their operations and trustworthy. Lack of integrity may cause a trustee to become disqualified from his role immediately. They should always be updated to the new methods of handling risks and get used to evaluating the financial status of the organization. The economic evaluation will prevent any organization from suffering from bankruptcy. Any trustee should be accountable and transparent to the organization involved.

References

Barone, A., 2019. trustee. [Online] Available at: https://www.investopedia.com/terms/t/trustee.asp[Accessed 20 march 2020].

Justia, 2017. Trustee Duties and Liabilities. [Online] Available at: https://www.justia.com/estate-planning/trusts/trustee-duties-and-liabilities/[Accessed March 2020].

The Scottish Council for Voluntary Organisation, 2018. Roles & Responsibilities of Trustees. [Online] Available at: https://scvo.org.uk/support/running-your-organisation/governance/roles-responsibilities[Accessed March 2020].

The Wheel, 2019. Role of the Trustee. [Online] Available at: https://www.wheel.ie/advice-guidance/governing-your-organisation/role-trustee[Accessed March 2020].

U.S. Trust, 2016. The Role and Responsibilities of a Trustee. Fiduciary Services for Merrill Lynch Clients, Issue 2, pp. 1-4.