The trustees of the City & Guilds London Institute are facing serious accusations of attempting to dodge accountability following a “catastrophic failure of governance” over the £166 million sale of the charity’s training and accreditation business. Members of the 148-year-old body voted overwhelmingly last month for an independent inquiry into the October sale to private operator PeopleCert, but the process has reportedly stalled. This controversy has triggered a Charity Commission statutory inquiry and raised questions about the stewardship of a legacy fund meant to support vocational education.
The sale, initially hailed as a “landmark deal” by former chair Ann Limb and CEO Kirstie Donnelly, created a new private company, City & Guilds Ltd, owned by PeopleCert. The rebranded charity, City & Guilds London Institute (CGLI), intended to use the financial windfall for charitable works, including funding vocational training for those in need. However, a December presentation to PeopleCert investors revealed plans that have since sparked widespread concern among members and governance experts.
Accusations of Stalling and Lack of Accountability
Neil Bates, an elected member of the City & Guilds council, which appoints and advises trustees, voiced strong criticism. “Why would they not be accountable for decisions made if everything was above board? It is shocking there has been such a catastrophic failure of governance – and subsequently a failure of accountability,” he said. Bates emphasized that the council cannot dismiss trustees unless misconduct is proven, adding: “There is £166m – that is what is left of the City & Guilds legacy. We want to remove this trustee board from having responsibility for those funds.”
The trustees have responded by stating they remain “committed to working constructively with members to find a clear and proportionate way forward.” A spokesperson said the board is reviewing options to shape this approach, ensuring they address members’ concerns while avoiding unnecessary duplication with the Charity Commission’s investigation. However, critics argue this response is insufficient given the scale of the alleged governance failure.
Background of the Charity and the Sale
Founded in 1878 by the City of London and 16 livery companies, City & Guilds was established to develop a national system of technical education. It charges fees for its accreditations to private training businesses, with about 60% of its income underpinned by stable government funding schemes. The charity maintained a fairly modest profile for much of its history, but the current row represents the latest episode in what has been a torrid six months for the organization.
The sale to PeopleCert in October 2025 was initially presented as a strategic move to secure the charity’s future. However, subsequent revelations have led to three separate investigations: a member-led vote for an independent inquiry, a Charity Commission statutory inquiry opened in January, and an internal investigation commissioned by PeopleCert. The overlapping probes have created confusion and frustration among stakeholders.
Key Governance Concerns
- Lack of transparency: Members allege that trustees are stalling the independent inquiry to avoid scrutiny.
- Conflict of interest: The sale created a private company owned by PeopleCert, raising questions about the charity’s future independence.
- Financial risk: The £166 million legacy fund is at the center of the dispute, with calls to replace the current trustee board with individuals better equipped to restore good governance.
According to the Charity Commission’s guidance, trustees have a legal duty to act in the best interests of the charity and to ensure proper governance. The statutory inquiry will examine whether these duties were breached during the sale process. Governance experts note that such failures can erode public trust and damage the charity’s reputation for years.
What Happens Next?
The Charity Commission’s investigation is expected to take several months, with potential outcomes including regulatory sanctions or recommendations for board changes. Meanwhile, the members’ call for a third independent inquiry remains unresolved. The trustees’ commitment to “review options” suggests they may eventually comply, but the delay has already fueled allegations of obstruction.
For the City & Guilds London Institute, the stakes are high. The charity’s ability to continue its mission of supporting vocational training depends on restoring confidence in its governance. As Neil Bates put it: “We need people properly equipped to restore good governance to the City & Guilds organisation.”
Frequently Asked Questions
What is the City & Guilds London Institute?
City & Guilds London Institute is a 148-year-old vocational charity founded in 1878 to develop technical education in the UK. It provides accreditations to private training businesses and relies on government funding for about 60% of its income.
Why is the £166 million sale controversial?
The sale of the charity’s training and accreditation business to PeopleCert in October 2025 was initially praised but later sparked concerns about governance failures. Members allege trustees are stalling an independent inquiry, and the Charity Commission has opened a statutory investigation into the deal.
What are the potential consequences for the trustees?
If the Charity Commission finds evidence of misconduct, trustees could face removal, financial penalties, or disqualification from serving on charity boards. The ongoing investigations may also lead to recommendations for structural changes within the organization.
