It shows how your charity is run, who is responsible, and what controls are in place – in short, it tells the reader that your charity is well governed.

Regardless of size, mission and location, all charities need to get this section right. The Charity Commission (CC15d) and SORP (FRS 102) expect a clear, concise explanation of the charity’s organisational structure and how decisions are made.

Charity Structure and Legal Form

Start by stating what kind of charity you are for example, a charitable company, CIO (Charitable Incorporated Organisation), or unincorporated trust and when the charity was established. Mention any key governing documents (e.g. the charity’s constitution or articles of association).

Good Practice:

• Briefly explain how the structure supports the charity’s purpose.
• If you’re part of a group or have subsidiaries, make this clear.

Avoid:

• Using legal jargon or copying directly from the governing document. Keep it accessible and relevant.

Governance and Trustee Oversight

This section should outline how the board is structured, how often it meets, and how it ensures proper oversight. It’s also a good place to mention trustee induction, training, and any delegated powers.

Good Practice:

• Summarise the board’s role in setting strategy, monitoring risk, and reviewing performance.
• Explain any sub-committees or working groups and how they report back to the main board.

Avoid:

Giving a shopping list of meetings and control procedures without explaining their role or contribution or repeating the same text each year. Keep it fresh, relevant to the charity, and reflect any changes in practice. 

Day-to-Day Management and Decision-Making

Here you explain how operations are managed for instance, by a chief executive or management team and how this relates to trustee oversight. Clarity is key: readers want to know who does what.

Good Practice:

• Describe the distinction between strategic oversight (trustees) and day-to-day delivery (staff or volunteers).
• If you rely heavily on volunteers, explain how they are recruited and supported.

Avoid:

Blurring the lines between governance and operations. If trustees appear too involved in day-to-day delivery, it may raise questions about independence and oversight.

A good example:

Peace Direct [Charity No. 06458464] is a mid-sized UK charity (that we do not have any connection with).  This section of their Trustees’ Annual Report covers two pages and is written in plain English and efficiently covers:

Distinctions between strategic oversight and day-to-day management, including financial forecasting and reserves monitoring.

Board responsibilities, meeting frequency, and the role of the Finance sub-committee.

Trustee recruitment, induction, policies on conflicts of interest, and internal controls, including a clear summary of the risks they have identified.

Final Thoughts

This section doesn’t need to be long or complicated but it does need to be clear and specific to your charity.

Keep in mind that the TAR is an annual report so don’t lose sight of what has happened during the year that you are reporting on.

Done well, the Structure, Governance and Management reporting demonstrates that your charity is well led, appropriately structured, and serious about good governance.  As part of a well-rounded TAR, it compliments your financial review and impact reporting building confidence that your charity is both effective and well run.