The Charity Commission has issued an official warning to Christ Church after finding misconduct or mismanagement in the administration of the charity.
Chris Church, one of the largest colleges of Oxford University, has been embroiled in a dispute since 2017 when former dean Dr Martyn Percy asked for a “substantial pay rise”. Percy, who stepped down earlier this year, was later accused of sexual harassment.
In 2020, the Commission told the college’s governing body and Percy to enter into a mediation process, adding that any regulatory intervention would be effective only if both parties had stable relationships.
The regulator has now found that the trustees did not follow advice it gave them between 2019 and 2020 to keep “close oversight of costs” in the dispute and subsequently issued the charity with an official warning.
Lack of transparency and accountability
Christ Church’s accounts show that the charity had a total income of £32.5m last year and recorded a deficit of nearly £2.2m.
Towards the end of 2021, the Commission asked the trustees to supply information about the costs of the actions in relation to the dispute with Percy and explain how they intended to manage expenditure.
It said that the trustees failed to provide the information in a timely manner and later found that no budget had been set aside for the costs related to the dispute. Instead, trustees agreed expenditure “retrospectively”.
The regulator found that between August 2018 and January 2022, Christ Church spent more than £6.6m on legal and public relations fees in a range of actions connected to Percy, of which over £5.3m were approved posteriorly.
Trustees also failed to ensure the charity’s accountability for its expenditure on the fees. Accounts for the years ending 2018-21 show that the said expenses were classed as “other direct costs – teaching, research and residential”. This, the Commission wrote, could mislead people who read the accounts.
Poor financial management
The Commission concluded that the trustees’ actions amount to misconduct and/or mismanagement in the administration of the charity.
It has asked the charity to complete a full independent governance review and implement and monitor its recommendations.
Christ Church must also inform the regulator of the review’s progress and implementation and ensure that its accounts and annual report for the year ending 31 July 2022 demonstrate that accountability.
“Failure to take steps to remedy the misconduct and/or mismanagement may lead to further regulatory action being taken against the charity’s trustees,” the Commission said.
Christ Church: Trustees’ decisions were ‘in the best interests’ of the charity
A spokesperson for Christ Church told Civil Society News that it has “repeatedly asked the Charity Commission for help to resolve the disputes with Percy” and explained why he was deemed unfit to be a trustee.
“In very complex and constantly changing circumstances, trustees made decisions which, having taken professional advice, they judged to be in the best interests of Christ Church. The costs and risks of the series of disputes with the former dean were a moving target as Percy behaved in a way that maximised the costs and other damage to Christ Church.
“Many of the costs were incurred as a result of Percy’s refusal to settle with a governing body which had lost trust and confidence in him. Christ Church had since 2018 consistently proposed mediation in order to settle the disputes as quickly as possible, but in three years of mediation, and up until this year, Percy always resisted a settlement.”
Former attorney general Dominic Grieve is reviewing the college's governance.
They added: “Following the official warning, Christ Church will continue to work closely with the Charity Commission, and is pleased to report that the implementation of their recommendation to review Christ Church’s governance is already well underway.
“Dominic Grieve has made substantial progress in the independent governance review which Christ Church initiated with the intention of introducing improvements into the governance structure of the charity, and is looking forward to hearing his recommendations. In particular, Christ Church hopes to reform its procedures so as to enable any future disputes of this nature to be resolved fairly and cost-effectively.”
Commission: Disputes risk ‘harming wider trust in charities’
Helen Earner, director of regulatory services at the Charity Commission, said: “These long and protracted disputes risked undermining the reputation of Christ Church and harming wider trust in charities.
“It’s not for us as regulator to take sides in disputes. Our role is to ensure that charities are governed effectively and that charitable funds are properly accounted for. All trustees must demonstrate sound financial stewardship, regardless of the level of resources available to them.”
She continued: “Good governance should be a priority for all trustees, especially those involved in important national institutions such as Christ Church, Oxford.”
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