THE Charity Council has launched a new Code of Governance for Charities and Institutions of Public Character (IPCs), to serve as an industry benchmark in governance standards.

The launch comes after extensive consultation with the public and charity sector, which has seen the Code tweaked since a draft version was released earlier this June.

The amendments were made based on feedback from 977 individuals from more than 700 charities and IPCs, as well as 200 written responses from individuals and organisations between June and August this year.

The voluntary Code will affect about 1,900 charities here, and covers nine key areas, including board governance, conflict of interest, financial management, human resource policies, and fund-raising.

One key recommendation is that a charity's board be 'wholly' independent' from its executive management.

However, recognising that some charities may find it necessary to keep paid staff on the Board, the Code will allow it as long as they comprise not more than one-third of the Board.

While the Council has recommended that board members should not be paid a salary, it said those that do must declare their exact salary and remuneration package.

To better safeguard the charities financial interest, board members holding the treasurer's post should step down from the position after serving a maximum of four consecutive years.

The Code is also 'tiered' such that IPCs and bigger charities will have more stringent guidelines, as they handle larger amounts of charitable resources for the public benefit.

Working on the principle of 'comply or explain', charities and IPCs unable to adhere to certain Code guidelines will have to explain their non-compliance.

Charities and IPCs must submit a Code evaluation checklist to the appropriate sector administrators via the Charity Portal by March 31 next year.

All IPCs are to publicly disclose their extent of compliance by March 31, 2009.

The extent of their compliance will affect their application for renewal of its IPC status.