At the end of 2022 and early in 2023 IAH Council made urgent changes to the Association’s governance, ahead of further consideration at the annual general meeting in September. This followed a decision by our bank, HSBC, to discontinue providing a service to us. HSBC gave seven weeks’ notice of termination of the account, leaving very little time to make alternative arrangements or to consider any strategic, longer-term needs.
Although no reason was given – banks are not required to give reasons – we know that mainstream banks in the UK now require at least half of a company’s directors to be based in the UK. Combined with this, there has been an apparent reluctance amongst UK banks to maintain accounts for charities and it is clear that IAH’s situation was not an isolated occurrence. Our finances continued to be well-managed and in good health, as confirmed by the accounts prepared annually by our auditors and submitted each year to the regulatory authorities.
The Charity Commission, IAH’s regulator, advised that it is preferable for at least half of a UK charity’s trustees to be based in the UK. However, they also told us that this is not a requirement, and other factors, such as where the charity has its base, are also taken into account when deciding on continued eligibility for charitable status.
Interim changes were put in place to bring IAH’s governance structure in line with the expectations of UK banks. Regional Vice Presidents would no longer have the formal legal responsibilities for IAH Ltd, or act as trustees for IAH as a UK-registered charity. They would continue to direct IAH’s activities in pursuing its mission statement and charitable aims, and maintain their critical regional responsibilities for members and national chapters.
Two additional UK-based non-executive directors were co-opted to IAH’s board so that, together with the members of the Executive Committee, 50% of IAH’s directors (trustees) are UK-based. Former senior IAH officers, John Chilton and Nick Robins, agreed to take on these roles.
Council voted to support these changes and the Rules were revised accordingly, for the time-being. New bank accounts were opened with Wise and Virgin Money. Some funds were also transferred temporarily to the account of IAH’s subsidiary World Wide Ground Water, with the formal agreement of all directors.
A contractor and a lawyer, both specialists in UK charity governance, were engaged to review IAH’s governance arrangements.