Annual Conference A5: Changing Governance: Building effective boards | NCVO

CHANGING GOVERNANCE: BUILDING EFFECTIVE BOARDS

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SPEAKERSDAN FRANCIS, GOVERNANCE CONSULTANT, NCVOROSIE CHAPMANCHAIR, CHARITY GOVERNANCE CODE STEERING GROUP

WHY CHANGE?

Governance fundamental to effective charitable activity Increased scrutiny of sector A need to meet and exceed public expectationsThe majority of trustees work diligently and voluntarily

GOVERNANCE CODE STEERING GROUP OBSERVER

Observer:

USING THE CODE• Designed to highlight good practice

not to be a compliance document • ‘Apply or Explain’• Encourage statement in annual report• A single set of principles but different

recommended practice

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STRUCTURE OF DRAFT

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Foundation principle7 full principles

Each with:• What the principle is• Rationale (and legal and regulatory

context)• Key outcomes • Recommended practice to meet

DRAFT CODE

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LEADERSHIP

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Every charity is headed by an effective board that provides strategic leadership in line with the charity’s purposes and values.

• Leading the organisation• The chair’s role• Leading by example

Staff confident and enabled to provide the information, advice and feedback necessary to the board.

INTEGRITY

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The board acts ethically and in line with its agreed values and culture to help achieve the organisation’s charitable purposes. The board is aware of the importance of the public’s confidence and trust in charities, and trustees undertake their duties accordingly.

• Maintain the charity’s reputation• Operates responsibly and ethically, in line

with its own values and those of the wider voluntary sector

• Identify, deal with and record conflicts of interest/loyalty

DECISION MAKING RISK AND CONTROL

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The board makes sure that its decision-making processes are informed, rigorous and timely and that effective delegation, control and risk assessment systems are set up and monitored.

• Delegation and control• Managing and monitoring performance• Actively managing risks• Appointing auditors and audits

DIVERSITY

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The board’s diversity supports its leadership and decision-making.

• Recruiting diverse trustees• Diversity in all its forms• Encouraging inclusive and accessible

decision making• Monitoring and reporting• Larger charities publish an annual

statement

BOARD EFFECTIVENESS

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The board works as an effective team using the appropriate balance of skills, experience, characteristics and knowledge to make informed decisions.

• Working as an effective team• Vice chair, ‘senior independent director’ or

similar• Access to independent advice• Board size and terms • Regular board review

OPEN AND ACCOUNTABLE

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The board leads the organisation in being transparent and accountable. The charity is open in its work, unless there is good reason for it not to be.

• Communicating and consulting effectively with stakeholders

• Developing a culture of openness within the charity

• Public register of interests• Publish remuneration levels of senior staff• Member engagement

ORGANISATIONAL PURPOSE AND DIRECTION

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The board is clear about the organisation’s charitable purposes and is assured that these purposes are being delivered effectively and sustainably.

• Strategic and assurance role• Determining organisational purpose• Achieving the purpose• Analyse the external environment• Explicit consideration of partnerships and

mergers

THE CODE AND PRACTICE

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In pares reflecting on the codes criteria, consider:

• One area of strength• An area for development

For your organisation based of the principles.

Share examples or any plans to implement recommended practice and

THE CONSULTATION

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• Both qualitative and quantitative collection techniques

• Including an online survey with both open and closed questions as well as email comments

• 201 responses in total• Regional feedback events; London, Cambridge,

Leeds, Cardiff

FEEDBACK

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Feedback• Positive feedback • 83% said that they would definitely or probably use the new Code• Some cross cutting themes• Some gaps • Some specific changes

Cross Cutting Themes• Accessibility of the document• Purpose of the Code• Proportionality in the Code• Links to further guidance and best practice• The apply/explain rule

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THANK YOU

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