I’ve lost count of the times I’ve seen bruised CEOs down at the pub, moaning about how bad their trustee board and governance is. But the truth, particularly for CEOs and senior staff of medium or larger charities, is they must take a share of responsibility not just for when governance goes wrong, but for getting it right.
Do any of the examples in the box below sound at all familiar to you, too?
Some ‘hypothetical’ examples
|Medium sized Charity A|
There’s a problem with poor governance. The Chief Executive has sent various documents to the Board about good practice, but nothing seems to happen. S/he can’t get crucial decisions out of the Board. When it’s difficult, they kick the can down the road. Nearly everything is left to the staff. The Chief Executive constantly complains about the uselessness of the Board but doesn’t feel s/he can do anything more about it – it’s their job, after all.
|Larger Charity B|
There are elections each year for Board members and other governance positions. The staff feel they mustn’t appear to interfere in these in any way. But there’s a problem. Very few people put themselves forward for election – usually from the same small number of better resourced branches, and there is seldom a contest. Staff could easily use their contacts to help the Board to stimulate more interest, but they don’t because it’s the governance domain.
|Small to Medium Charity C |
The founder is still involved, along with stalwarts who have been with him or her on the board for more than twenty years. Newer trustees struggle to feel they are valued and influential and feel they must fall in with the views of the founder. The staff find it very difficult to promote innovation as circumstances change. But what can they do if the trustees don’t see the problem – governance is their business, isn’t it?
|Charity D (any size!) |
Some of the trustees feel they know how to run the organisation on ‘proper business lines.’ Staff are demoralised. Trustees keep interfering in detailed operations. Hours are wasted interrogating relatively minor issues, while strategic overview is lacking. But the trustees are very confident they know what they are doing – and it’s up to them to interpret their role, isn’t it?
Why do charities get this wrong?
Why do we so often find ourselves leaving governance to the trustees – at bargepole distance – with problematic results?
Firstly, the Charity Commission’s insistence that trustees are ultimately responsible, and are held to account if anything goes wrong, means that trustees feel they mustn’t become too dependent on staff and must retain their independence of mind and action. Quite correct, but this concept becomes easily misinterpreted as ensuring staff keep their noses out of governance.
Secondly, the fitful engagement of volunteer trustees can be overwhelmed by the full-time commitment and greater knowledge of the staff. Governance can therefore be seen as an area to be jealously protected from the reach of staff, the domain where trustees can think their own thoughts and generate a genuine counter-weight to the domination of paid staff. And it’s right to be sensitive about that imbalance.
Thirdly, an over-simplified model of trustee versus staff responsibilities can mislead us. The conventional wisdom holds that trustees shouldn’t interfere in management or day-to-day operations, and managers shouldn’t interfere in governance. But governance is the staff’s business too – because their job is to advise and support the board in all aspects of running the charity to the maximum benefit of the cause.
In practice the line between governance and management is blurred. Ill-informed governance decisions can quickly mess up management and operations. But plenty of ‘operational’ decisions also have an impact on the reputation of the charity, which is the board’s proper concern.
Think, for example, of messaging around controversial documents or tweets, or management decisions relating to safeguarding. The board (especially the Chair) and senior staff clearly must work closely together to navigate such tricky areas. They must strive to create fluent communication, deep shared commitment and trust – not resort to the bargepole.
The Charity Governance Code isn’t just for trustees
So, we’ve got to think of governance as a collaborative enterprise between board and staff, each with their distinct roles. It’s worth looking at the excellent Charity Governance Code’s categories and themes in this light:
- Organisational purpose requires a board clear about the charity’s aims, but if the staff are not equally clear, the charity will founder, and if trustees begin to go off-piste in relation to the charity’s purpose and agreed priorities, the staff have a duty to raise this.
- Strategic leadership in line with the charity’s aims and values cannot be confined to trustees or staff. In the end, the trustees decide on the strategy, but on the basis of extensive advice, analysis, arguments and usually drafting by staff, and all must then combine to make the strategy a living reality.
- Integrity is critical for good governance but it’s no good exemplifying that on the board if the staff do not also share, live and breathe the values to which the charity must be true.
- Decision-making, risk and control must be a thoroughly shared enterprise too. The board will rely heavily on staff to help identify risk and establish the monitoring systems to enable risk to be managed effectively.
- Other key categories of Board Effectiveness, Diversity and Accountability are the same; yes, each has a distinct role, but there is interdependence and shared responsibility for enabling good governance to happen in real life.
In all these areas, the Board is ultimately responsible for taking the big decisions – on strategy, policies, financial sustainability and fiduciary compliance. But they need sound advice, information and systems from the staff to do that.
Better understanding about the role of the CEO and senior staff in supporting good governance is, to my mind, a priority – and a better alternative to moaning in the pub. Our friends and colleagues at organisations like ACEVO, Association of Chairs, NAVCA, NCVO, ACF, and the Charity Governance Code Steering Group should ask: are we all doing enough to overcome the bargepole fallacy?