Management and Organization

Meet your responsibilities

 

Standard 3 | Governing bodies

The governing bodies meet their responsibilities.

As the supreme governing body of an association, the general meeting of the members or delegates determines the principles of the organization. In the case of foundations, the board of directors determines the principles of the organization in accordance with the foundation charter. This applies analogously to organizations with a different legal form.

The board of directors is normally the board of trustees for foundations and the committee for associations. As the strategic governing and supervisory body, it has a medium- and long-term governing and supervisory function. The board of directors bears overall responsibility for the organization, in particular for its business activity, administration and use of funds, risk management and internal control.

The Chairperson heads the board of directors and ensures that it works efficiently and effectively. The board of directors determines the structures and procedures required for performance of its duties and monitors these on a regular basis.


Under its supervision and responsibility, the board of directors may delegate tasks to the executive management and appoint standing or temporary committees.

The composition, assignment, competence, duration and responsibility of the committees must be defined and in the case of standing committees, recorded in a directive.

The board of directors takes responsibility for tasks that are not explicitly assigned to other bodies.

 

Standard 4 | Independence

The board of directors comprises at least five mutually independent members.

The board of directors comprises at least five members.

None of the members of the board of directors is closely related* or related by marriage or married to another member, or in a long-term partnership with another member.

If the board of directors comprises at least seven members, two of them may be personally related as defined in no. 2 above.

If the board of directors has more than nine members, it must ensure that adequate decision structures are in place.

Members possess the skills required for meeting their responsibilities. Efforts must be made to ensure that the members of the board of directors are suitably diverse.

A regular term of office is four years maximum. Re-election is possible. The board of directors organizes the renewal of its members in good time.

* Closely related: first degree relative (parents/children), second degree relative (siblings/grandparents/grandchildren) and third degree relative (nephews/nieces).

 

Standard 5 | Vested interests

Vested interests are transparent and conflicts of interest are avoided.

Members of the board of directors disclose vested interests which are relevant to the activity of the organization in the annual report or on the organization’s website.

If the interests of the organization clash with the interests of members of the board of directors or their associates, these interests are disclosed to the board of directors. In such cases, the member concerned abstains.

Members of the board of directors must abstain if they or an individual or legal entity associated with them is involved in a transaction.

Transactions by the organization with members of the board of directors or their associates must ultimately be concluded on the same terms as those with third parties.

Important transactions with associates* of the organization are disclosed in the notes to the annual financial statement.

* ‘Associates‘ are defined in Swiss GAAP FER 15. In addition, according to the notes on Swiss GAAP FER 21, organizations whose purpose is coordinated with the charitable NPO are also classified as NPO associates. Examples of associates of charitable NPOs are: current and former members of the board of directors (e.g. Committee of the Association, Board of Trustees) and management; organizations controlled by members of the board of directors; organizations over which the charitable non-profit organization exercises a significant influence (e.g. through representation in the board of directors); members, benefactors, founders of the organization who exercise a significant influence; supporters‘ association of the charitable NPO; organizations with which the NPO has a common market presence.

 

 

Standard 6 | Separation of powers

The board of directors and executive management are kept personally and functionally separate.

A member of the board of directors may not simultaneously be the executive director or a member of executive management.

A member of the board of directors may not be related by birth or marriage or married to the executive director, or be in a long-term partnership with him/her.

The executive director may only have an advisory role on the board of directors.

Employees of the organization, with the exception of the representation of employees, may not be members of the board of directors.

The segregation of duties between the board of directors as a strategic governing and supervisory body and executive management must be stipulated in writing with a clear definition of tasks, competences and responsibilities.

Personal separation of powers may be waived if the organization does not employ any staff and if the operational tasks of the honorary members of the board of directors are performed in such a way that segregation of duties is ensured.

 

Standard 7 | Internal control

The organization has appropriate internal controls and a suitable risk management system.

The board of directors takes care of appropriate internal controls and a suitable risk management system as regards

  • achieving the strategic goals of the organization
  • effective and efficient performance
  • transparent and honest reporting, accounting and communication
  • compliance with laws, standards and values of the organization (Compliance)
  • prevention and combating of corruption


The organization applies the following controls in particular:

  • Collective signatory powers generally apply for legally binding transactions.
  • Collective signatory powers generally apply for payment transactions.
  • Single signature exceptions must be set down in writing and suitably restricted.
  • There is an appropriate segregation of duties.

 

Standard 8 | Remuneration

The members of the board of directors provide their services on a honorary basis. Appropriate remuneration is paid to employees.

The following applies to ordinary tasks of members of the board of directors as the strategic governing and supervisory body:

  • Except for any employee representatives, members of the board of directors do not have a paid relationship with the organization as defined by labour law.
  • Moderate remuneration may be paid to members of the board of directors for particularly time-consuming work.
  • Actual expenses may be reimbursed or remunerated by an appropriate flat-rate allowance.
  • The amount of any remuneration must take into account the size and charitable nature of the organization.
  • The total amount of all remuneration is assessed. The form in which this was paid (e.g. hourly, daily or other rates, official, annual, meeting, expense or other flat-rate allowances) is immaterial. Reimbursement of documented expenses which are not covered by flat-rate allowances is not included in remuneration.
  • Any remuneration must be clearly, transparently and objectively defined by decision of the board of directors.

Members of the board of directors may take on paid tasks in the form of a mandate on the following conditions:

  • The board of directors retains its supervisory obligation.
  • The separation of powers between the strategic governing and supervisory body and the operational business is not compromised or the task concerned is an exceptional time-limited task.
  • The task and its duration and remuneration must be defined by decision of the board of directors.
  • Remuneration must not be higher than the normal rate in the mandated sector.

The total remuneration in no. 2) and 3) includes all remuneration paid by the organization. It must be consistent with the size and charitable nature of the organization and the time involved.

The following applies to employees and the executive management: Remuneration must be consistent with requirements, qualifications, responsibility and work performance. Salaries for the members of the executive management must also be in line with the levels in effect in other similar charitable organizations.

The total of the remuneration paid to members of the board of directors and the total of the remuneration paid to members of the executive management must be disclosed in the notes to the annual financial statement in accordance with Swiss GAAP FER 21.

Remuneration paid to the Chairperson must also be shown separately.

Mandates to members of the board of directors must be reported in the notes to the annual financial statement as transactions with associates, in accordance with Swiss GAAP FER 21.

Individual payments to members of the board of directors and payments to the executive director must be disclosed separately to Zewo.

Introduction

The 21 Zewo standards came into effect on 1 January 2016.

Charitable Non-Profit Organization with the Zewo quality seal will be assessed for compliance with the 21 Zewo standards using assessment processes due to launch on 1 January 2017, in accordance with the Zewo quality seal regulations.

Charitable Non-Profit Organization without the Zewo quality seal will be assessed for compliance with the 21 Zewo standards from 1 July 2016 in accordance with the Zewo quality seal regulations.

(see: https://www.zewo.ch/fur-hilfswerke/die-21-zewo-standards)

 

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