Good Governance

Governance is the term used to describe the trustees’ role in:

  • The long term direction of the charity, including its objectives or purposes;
  • Implementing policies and activities to achieve objectives;
  • Complying with legal requirements;
  • Accountability to those with an interest or ‘stake’ in the charity.

‘Good governance should happen throughout a charity. The trustee board is responsible for good governance but they rely on many different people to be able to govern well: staff, volunteers, advisors and stakeholders.’ – NCVO

“Good governance is fundamental to effective museum activity”

Trustee’s Foundation Principles

We have taken the assumptions laid out in the Charity Code of Governance consultation 2017 as our starting point. It simply states that all trustees:

  • Must be committed to their charity’s cause and have joined its board because they want to provide leadership, helping the charity deliver its purposes most effectively for public benefit;
  • Understand their roles and legal responsibilities, and, in particular, have read and understand: – the Charity Commission’s guidance The Essential Trustee (CC3)1 and their charity’s governing document;
  • Are committed to good governance and want to contribute to their charity’s continued improvement;
  • Are prepared to challenge, and be challenged, in a constructive way.

Board’s Foundation Principles

  • The delegation of authority – clear roles and responsibilities, who is accountable to who? Processes and lines of communication, distinction between management and board;
  • The board must always demonstrate the values of its organisation and ensure it always behaves in a professional, open, fair and transparent way;
  • Checks and balances to ensure that not one person retains more power or influence;
  • Professional rigorous decision making, supported by appropriate skills and experience. Looking at a museum’s strategic priorities, does the board have the necessary skills and experience?

A board is accountable to:

  • Transparency is an integral part of board behaviour. On an individual basis this applies to trustees who must declare all interests and potential conflicts of interest, there must be no hidden agendas or divided loyalties. Reporting must be open and honest. Rolling internal audits ensure that controls are in place and working effectively;
  • Conflicts of interest need to be managed, this is a legal requirement. Where someone is a member or employee of another organisation then that relationship must be recorded and regularly updated. A trustee cannot represent the interests of another organisation while acting on behalf of the museum. A register of interests must be in place and updated every 12 months, alongside a current policy on conflicts of interest.
  • A board must acknowledge and manage risk. The Board retains overall responsibility for risk management and discusses and decides the level of risk that it is prepared to tolerate. It promotes a culture of prudence with resources but also understands that being over cautious and risk averse is itself a risk.

What Makes a Really Great Board?

  • Good boards must “Review, reflect, learn and develop” – Leading Governance. This is an ongoing process of skills development and learning (see The Learning Board by Bob Garrett), that is used to develop an ethos of improved effectiveness and best practice. The board that doesn’t commit to development risks not having the skills, expertise and diversity to lead its organisation successfully, Bob Garrett puts this very clearly in his book The Fish Rots from the Head –

For organisations to survive and grow, their rate of learning has to be equal to, or greater than, the rate of change in their environment”

  • A balanced, informed contribution from all trustees that leads to a consensus in direction. It’s essential that all voices are heard, that trustees arrive at meetings informed and prepared, and that there is an ability within a board to challenge and debate issues openly;
  • There must be transparency at all times to engender trust from stakeholders in the decision making process;
  • Mutual respect between trustees and between trustees, management and volunteers. There must be clear lines of communication and clarity of roles and responsibilities. To avoid undermining staff and risking reputational damage it is essential that the Chair and the CEO/Director/Senior Volunteer work closely together to ensure that all communications between board and staff goes through them. A common damaging habit is where trustees become involved in day to day operations;
  • A good chairperson is essential. They must have strong leadership skills, provide structured agendas and make sure that accurate and relevant information is available in a timely manner to enable the board to make effective decisions;
  • A proper process for ensuring ongoing board renewal must be in place. 9 years as a trustee is the maximum recommended by the Code of Governance 2010. Diversity should not be considered a ‘tick box’ effort. To really ensure that you fully represent all your stakeholders, and have the skills and experience in place to effectively deliver your organisational goals there must be genuine diversity on a board.

Role of the Board

  • The board should be clear about the museum’s purposes and ensure these are delivered;
  • Develop and leading the organisation’s mission and strategic direction in line with the museum’s purposes and values;
  • Ensure that the museum complies with all legal and regulatory legislation as a minimum requirement, ideally they should demonstrate leadership by continually improving and developing best practice;
  • Really effective planning and control, ensuring that agreed targets are in place and are measurable and achievable;
  • To ensure a high standard of governance, ethics and behaviours throughout the organisation, boards must lead by example and ensure trustees behave accordingly;
  • To select and remunerate the CEO and ensure effective management;
  • To ensure adequate resources are in place, the board is responsible for ensuring that the organisation has a deliverable and realistic fundraising strategy in place. The board needs to demonstrate leadership on this. As Joy Allen from Leading Governance explained, trustees should “lead by example when it comes to giving, in the USA trustees are expected ‘to give, get (fundraise from contacts) or get out’”.

Role of the Trustee

  • The trustee must effectively prepare for and contribute to board and committee meetings;
  • To be well informed about the organisation’s purpose, strategies, services and operating environment;
  • To be prepared to challenge the CEO in an open and constructive way, and to support them and their position within the organisation;
  • To advocate for the museum;
  • To maintain balance between strategy and management;
  • To question effectively and share responsibility for decisions;
  • To undertake other roles as required, for example interview panels, disciplinary appeals etc..;
  • To avoid even the appearance of a conflict of interest, disclose potential conflicts of interest immediately to the Chair.

Role of the Chair

  • To lead the board and ensure its effectively meeting its goals by
    • Making sure resources are used efficiently;
    • Ensuring high standards of governance and leadership at all times from the trustees;
    • Representing the museum;
    • Assessing and auditing the effectiveness of the board/trustees and putting in place processes for the continual development of the board – The Learning Board. Governance development should be a part of any strategic plans.
  • Ensuring the board is efficient and effective by
    • Properly planning meetings and making sure all trustees have relevant information to make decisions;
    • Putting in place process for induction of new trustees;
    • Ensuring energy is focussed on priorities and not on the minutiae of day to day operations, this is the role of management;
    • Securing professional advice where needed;
    • Ensuring the board is kept informed of performance data;

Establishing a good, balanced working relationship with the CEO to enable effective planning, control, support and appraisal.

 

*With thanks to Leading Governance.