RISK MANAGEMENT STRATEGY

Transcription

1 Agenda Item No: 15 RISK MANAGEMENT STRATEGY PURPOSE: The Risk Management Strategy has been updated to reflect the revised approach to the Corporate Risk Register and Board Assurance Framework and to reflect the introduction of Director line accountability. The RAQC approved the strategy at its December meeting, subject to a couple of amendments that have now been incorporated into this final version. The Board is asked to approve the revised Risk Management Strategy. IMPLICATIONS: Objectives to which issue relates Risk issues Financial HR Healthcare/ National Policy Legal issues Equality issues Relates to all assurance objectives The trust needs a ratified Risk Management Strategy to meet NHSLA and core standard C7a&c requirements Financial implications of mitigating risks will be considered by the Board as part of the review mechanisms recommended in the strategy All staff are required to act on the recommendations of this strategy and any associated policies Healthcare Regulation through Healthcare Commission, key component of NHSLA requirements and central to the Trust s FT application Significant in terms of Health and Safety legislation and the Corporate Manslaughter Act None identified RECOMMENDATION: The Trust Board is asked to approve the Risk Management Strategy DIRECTOR: Director of Corporate Development PRESENTED BY: Director of Corporate Development AUTHOR: Director of Corporate Development DATE: 10 th December 2008 Version No: 6 Date of issue: 1 st December 2008 Page 1 of 24 Valid until: December 2009

2 East & North Hertfordshire NHS Trust Risk Management Strategy Date of issue: 1 st December 2008 Page 2 of 24

3 CONTENTS 1. INTRODUCTION AIMS AND OBJECTIVES DUTIES AND ACCOUNTABILITIES LOCAL MANAGEMENT OF RISK ASSURANCE FRAMEWORK AND RISK REGISTER TRAINING AND SUPPORT KEY PERFORMANCE INDICATORS (KPI S) COMMUNICATION WITH STAKEHOLDERS / STAFF MONITORING THE EFFECTIVENESS OF THE STRATEGY EQUALITY IMPACT ASSESSMENT...8 APPENDIX 1 DUTIES...9 APPENDIX 2 TRUST BOARD COMMITTEES TERMS OF REFERENCE...9 APPENDIX 3 BOARD REPORTING FORM...23 Acknowledgements Thanks are given to the NHS Litigation Authority and to West Hertfordshire Hospital NHS Trust and Hillingdon Hospital NHS Trust who kindly shared their Risk Management Strategies. Date of issue: 1 st December 2008 Page 3 of 24

4 1. Introduction All actions contain inherent risks. Risk management is central to the effective running of any organisation. East and North Hertfordshire NHS Trust will ensure that decisions made on behalf of the organisation are taken with consideration to the effective management of risks. The Trust Board needs to be confident that the systems, policies and people it has put in place are operating in a way that is effective, is focused on key risks, and is driving the delivery of the trust s objectives. The Trust Board needs to demonstrate that it has been properly informed, (through evidence from the Board Assurance Framework and Corporate Risk Register), that it is aware of the totality of the risks facing the organisation, and that it has made effective decisions on the management of risk based on the available evidence. The Trust recognises that risk management must be embedded in order for the organisation to function safely and effectively. The Trust Board is therefore committed to ensuring that risk management forms an integral part of the organisation s philosophy, practices, activity and planning, and should not be viewed as a separate programme of work at any level within the organisation. All stakeholders, internal and external, must be considered within the trust s risk management arrangements. This strategy will be reviewed by the Trust Board annually. 2. Aims and Objectives The overall objective of the Risk management strategy is to improve the quality of care received by our patients, to ensure the maintenance of a safer environment for our patients, employees and visitors, to reduce the Trust s losses to a minimum, and to enable the achievement of the Trust s operational and strategic objectives. The delivery of a first class service requires the trust to take responsibility for the appropriate and effective management of its risks, in a way that informed business decisions are taken to improve safety and quality. The Trust s Risk Management Strategy reflects the principles set out in the Trust s Corporate Objectives and specifically seeks to: Maintain and continually seek to improve the quality of healthcare provided by the Trust through the minimisation of risk. Identify and control risks which may adversely affect the Trust s operational ability. Develop a fair and just culture. Provide and maintain a safe and secure environment for patients, staff and visitors. Encourage and support innovation and service developments within a framework for risk management. Protect the services, finances and reputation of the Trust through risk evaluation, control, elimination or transfer of risk. Otherwise ensure the organisation openly accepts the remaining risks. Create awareness throughout the Trust about the importance of actively managing risk. Ensure risk management systems and processes are clear and understood by all staff. Develop all staff to ensure they have the knowledge and skills in risk management appropriate to their role. Date of issue: 1 st December 2008 Page 4 of 24

5 Through a process of risk identification, assessment, learning and control the organisation will maintain a dynamic Corporate Risk Register that will inform the Board Assurance Framework and thereby provide assurance to both the Board and the community we serve. 3. Duties and Accountabilities The Chief Executive has overall accountability and responsibility for risk management within the Trust, and following the implementation of a system of Director line accountability, he has delegated responsibility for providing assurance on all areas of risk to individual Executive Directors. The Executive Directors are held to account for progress with mitigating identified risks by the Risk and Quality Committee, while the Trust s Audit Committee provides assurance to the Board on the overall process for identification, assessment and management of risk. Responsibility for maintaining the trust s risk management arrangements has been delegated by the Chief Executive to the Director of Corporate Development. Commitment to risk management is a non negotiable requirement at all levels of the organisation. All staff throughout the Trust, including contractors and temporary staff, are expected to participate in risk management processes. Specific duties and responsibilities are outlined at Appendix 1. The designated Assurance Committees of the Trust Board are the Risk and Quality Committee and the Audit Committee. They are supported by the Finance and Performance and Executive Committees. The Terms of reference for these Board Committees are provided at Appendix Local Management of Risk Each Clinical Division will continue to maintain a comprehensive risk register, which will be formally reviewed as part of the Divisional Performance Review process (bi monthly). At these meetings the Divisions will be expected to report on their top risks and present action plans for minimising and managing these risks. The Divisional risk registers will be collated with the risks identified within the Corporate Directorates to form the Corporate Risk Register which will be subjected to review and challenge by the Risk and Quality Committee. The Risk and Quality Committee will report monthly, on an exception basis, to the Board and the Board itself will review the Corporate Risk Register on a quarterly basis. The Trust will ensure that risk management is supported by the development of formal mechanisms to assess risk and to measure the effectiveness of risk management strategies, plans and processes. In particular: Risk management will be supported by accurate, timely and effective incident reporting, including categorising the consequences of risk and investigating system failures Preventative risk management processes will be applied to the management of facilities, equipment and clinical practice Risks will be escalated from committees using a standard Board reporting form as shown at Appendix 3 Safe systems of work will be in place to protect patients, visitors and staff Risk Registers will be in place with all risks linked to a corporate objective and owned by the appropriate Executive Director Date of issue: 1 st December 2008 Page 5 of 24

6 There will be a process of challenge at Performance Review meetings by the Executive Committee in relation to assumptions underpinning risk scores and plans Evidence will be maintained to demonstrate that recommendations and action plans have been developed and changes implemented accordingly Risk assessments will be undertaken for strategic policy decisions and documents relating to new projects. 5. Linking the Assurance Framework and the Corporate Risk Register The Assurance Framework provides the Trust with a simple but comprehensive method for the effective and focused management of risk. Through this Framework the Board gains assurance from the appropriate Executive Director that risks are being appropriately managed throughout the organisation. The Assurance Framework identifies which of the organisation s aims and objectives may be at risk because of inadequacies in the operation of controls, or where the Trust has insufficient assurance. At the same time it encompasses the control of risk, provides structured assurances about where risks are being managed effectively and ensures that objectives are being delivered. This allows the Board to determine how to make the most efficient use of resources and address the issues identified in order to improve the quality and safety of care. The Assurance Framework is built around the Trust s Corporate Risk Register which provides a record of all identified risks to the organisation. Each risk is aligned with a corporate objective to facilitate a straightforward means of assessing compliance. The Risk and Quality Committee, with additional oversight provided by the Audit Committee, determines whether or not any risks from the Corporate Risk Register should be transferred to the Assurance Framework. This approach is clearly defined in the Trust s Risk Register policy. The Corporate Risk Register is populated with risks arising from sources throughout the organisation, specifically: Business and Service Delivery Plans i.e. principal risks to the Trust achieving key performance standards Adverse Incident Forms if it is apparent from an adverse event form, or subsequent investigation into the adverse event, that there is a significant risk then it will be transferred to the risk register Health & Safety Risk Assessments Health and Safety risk assessments are a legal obligation for the Trust, and managers are responsible for ensuring these assessments are undertaken. Any risk identified from these assessments will be included on the Risk Register Local Risk Assessments where local assessments have identified risks External Assessment / Audit significant risks identified by any internal / external audit e.g., Healthcare Commission, NHS Litigation Authority, H&SE notices, will be placed on the Risk Register External Guidance / Alerts NICE, NSFs, etc that are not yet implemented Results of Feedback Learning from our patients and the public, whether through analysis or learning resulting from complaints, claims, surveys, observation of practices etc. Date of issue: 1 st December 2008 Page 6 of 24

7 An overview of the assurance process is illustrated below. Local & Corporate Risks Lead Executive Directors Clinical Divisions & Corporate Directorates Risk Register Assurance Framework Audit Committee RAQC BOARD Challenge & Review from Executive Committee 6. Training and Support At the heart of this strategy is the desire to learn from events and situations in order to continuously improve management processes. All members of staff have an important role to play in identifying, assessing, reviewing and managing risk. The Trust will provide information, training and support to achieve this. The Trust will: ensure all staff have access to a copy of this Risk Management Strategy via the Trust s Knowledge Centre (intranet) communicate with staff any action to be taken in respect of risk issues e.g.,. via the Trust Bulletin and the Patient Safety Bulletin develop policies, procedures and guidelines based on the results of assessments, investigations and all identified risks ensure that training programmes as identified in the Training Needs Analysis raise and sustain awareness of the importance of identifying and managing risk ensure that staff have the knowledge, skills, support and access to expert advice necessary to implement the policies, procedures and guidelines associated with this Strategy facilitate specific risk management training for Board Members, Executives and Senior Managers, as specified in the Risk Register Policy. In line with ALE requirements (KLOE 4.1) and NHSLA standard 1.4, attendance at training will be recorded, with non attendance followed up. Date of issue: 1 st December 2008 Page 7 of 24

8 7. Communication with Stakeholders / Staff Systems of communication with stakeholders that contribute to minimising risk are in place. These systems include the Trust website, the Involvement Committee, the annual patient survey, consultation publications, the annual general meeting, and the Public Board Meetings. Communication with staff is mainly via line management at team meetings, the Trust Bulletin, the Knowledge Centre or Trust wide s. A national staff survey is carried out annually and a safety culture questionnaire every two years. 8. Monitoring the Effectiveness of the Strategy The strategy will be reviewed and approved on an annual basis by the Trust Board. Reports relating to risk management will be presented monthly to the Risk and Quality Committee and on a regular basis to the Trust Board in line with the Board Cycle. 9. Equality Impact Assessment This strategy and its impact on equality have been reviewed in line with the Trust s Equality Scheme and no detriment was identified. Date of issue: 1 st December 2008 Page 8 of 24

9 Appendix 1 Duties Chief Executive & Directors The Chief Executive is ultimately accountable for ensuring that there is a comprehensive risk management system in place and maintained in accordance with this strategy. The Chief Executive has delegated responsibility for all areas of risk to individual Executive Directors (areas of accountability are reflected in the Corporate Risk Register and Board Assurance Framework). The designated Non Executive Director for Risk Management monitors the delivery of the risk management strategy and chairs the Risk and Quality Committee. Divisional Chairs and Divisional Directors Divisional Directors, supported by the Divisional Chairs, are responsible for ensuring that effective risk management processes, as described within this strategy, are in place and implemented within their Divisions. Divisional Chairs are responsible for leading and monitoring clinical governance issues with relevant staff. All Managers (inc. Managers of Contracts) All managers are accountable for the day to day identification and management of all risks within their area of responsibility. They must ensure that risk registers are maintained; that risk assessments are undertaken and preventive action is carried out where necessary. Senior Clinical Risk Management Advisor The Senior Clinical Risk Management Advisor is responsible for overseeing the day to management/coordination of clinical risks; is a resource for all clinical risk related issues; advises and supports Divisional leads; and reviews performance through the interrogation and trend analysis of incident data held on Datix. Safety & Security Manager The Safety & Security Manager is responsible for overseeing the day to day management /coordination of non clinical risks throughout the organisation in conjunction with other non clinical risk management specialist advisors (inc. Health & Safety Advisor, Fire Risk Manager, Moving & Handling Advisors, Infection Control team, Occupational Health who are responsible for their respective areas). All Staff (inc. contract staff and agency staff) Management of risk is a fundamental duty of all staff. All staff must follow Trust policies and procedures; ensure that identified risks and incidents are dealt with swiftly and effectively; report all incidents and near misses to the Risk Management Department; and undertake mandatory training. All Clinical Consultants All clinical consultants have a responsibility to identify and assess the risks of the clinical services they offer; inform patients of all common or serious risks relevant to the treatment offered and ensure appropriate consent is sought; undertake appropriate training and seek permission to introduce new interventional procedures. Date of issue: 1 st December 2008 Page 9 of 24

10 Appendix 2 Trust Board Committees Terms of Reference RISK & QUALITY COMMITTEE TERMS OF REFERENCE Purpose: The purpose of the Committee will be to ensure that the Board has a sound assessment of risk and that the Trust has adequate plans, processes and systems for managing risk. It is inclusive of clinical and corporate risk, clinical governance, clinical effectiveness, research governance, financial risk, information governance, health & safety, staff governance and patient and public safety. The Committee will ensure that the Trust has an effective management and clinical governance framework which includes the assessment and monitoring of quality indicators which drive forward the development of quality of services and care, patient safety and patient experience. Authority: The Committee is constituted as a formal committee of the Trust Board. The Committee is authorised by the Board to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co operate with any request made by the committee. The Committee challenges and provides assurance on all areas of risk to the Audit Committee and the Trust Board. Membership: The Trust s Vice Chairman and two other designated Non Executive Directors. The Trust s Vice Chairman will chair the committee. Attendance: Chief Executive Director of Nursing & Clinical Governance Director of Corporate Development Medical Director Director of Human Resources & Organisational Development Director of Strategic Development Director of Operations Director of Finance Strategic Advisor, Governance Trust Secretary In addition to the above list of attendees the committee will co opt attendance as required from Infection Control, Health and Safety, Clinical Governance etc. Date of issue: 1 st December 2008 Page 10 of 24

11 The Committee will be quorate if two non executive directors are present. All attendees are expected to attend each meeting or to send a nominated deputy and a written report when they are unable to do so. Frequency of Meetings: The committee will meet monthly. Responsibilities: Managing Risk To provide assurance to the Board that the services the Trust provides meet all national standards and are safe, effective, high quality and patient focused To endorse and monitor the Trust s key governance strategies To review and monitor the Board Assurance Framework and the Corporate Risk Register, ensuring appropriate action is taken to mitigate risks where possible and advise the Board where acceptance of risk may need to be considered To monitor the standards and reviews from external bodies through receiving development plans, outcome reports and associated action plans, e.g. Healthcare Commission, NHS Litigation Authority (NHSLA), Clinical Negligence Scheme for Trusts (CNST), Health & Safety Executive (HSE), Strategic Health Authority (SHA), the Auditors Local Evaluation (ALE) and ensure action is taken for compliance. Please note: This committee will focus on the risk elements within ALE and the full requirements will be formally monitored through the Trust s Audit Committee To improve and develop the effectiveness of the assurance systems across the Trust by monitoring activity across the Trust through regular reports specified by the Committee in the Committee s Annual Cycle, and by exception To receive reports and monitor the progress in mitigating risks arising from the Trust s major service developments To work with the Audit Committee when appropriate, and specifically in agreeing the Annual Internal Audit plan and Annual Health Check declaration Ensuring Compliance To monitor and advise the board on progress against national and local governance standards and compliance framework; this includes governance risk rating, exception reports and monthly SHA performance monitoring return (Monitor s Compliance Framework when achieve FT Status) To receive and review regular progress reports for achieving compliance against all aspects of the Quality of Services, Annual Health Check, (Standards for Better Health, Existing Commitments and National Priorities) To monitor and advise the Board on compliance with the Hygiene Code To receive reports on the changes to Healthcare Regulation and assurance as to how the Trust will manage this process Improving Quality To endorse and monitor the implementation of the Trust s key quality, patient safety and patient experience strategies Date of issue: 1 st December 2008 Page 11 of 24

12 To receive regular reports from the Trust and Divisions on Patients Safety and Clinical Quality and Outcomes ensuring appropriate action is taken To receive regular reports from the Trust and Divisions on Patient Experience Indicators ensuring appropriate action is taken To receive regular reports from the Trust and Divisions on Nurse/Patient Indicators ensuring appropriate action is taken To support the implementation of the Productive Ward, releasing time to care initiative; incorporates meeting performance standards, improving patient experience, balancing the books/financial pressures, improving patient safety. To be advised of the progress of any major quality initiatives in the Trust Reporting arrangements The Committee will report to the Trust Board after each meeting, using the approved committee reporting form. It will make recommendations to the Board, Executive Team and Executive Directors for these groups/individuals to take appropriate action. The Committee will provide reports to the Audit Committee as requested. Support The Board Committee Secretary will support the committee administratively, with responsibility for: Agreement of agenda with the Chairman, attendees and collation of papers Taking minutes Keeping a record of matters arising and issues to be carried forward Advising the Committee on pertinent areas Date of issue: 1 st December 2008 Page 12 of 24

13 AUDIT COMMITTEE TERMS OF REFERENCE Every Trust must have an Audit Committee. The aim of this Committee is to provide an independent and objective review of the Trust s system of internal control including its financial systems, financial information, assurance arrangements including clinical governance, approach to risk management and compliance with legislation 1. Membership Three Non Executive Directors (excluding the Chair of the Trust Board), one of whom shall be Chair. 1.1 Attendance The Director of Finance, the Head of Internal Audit, and a representative of the External Auditors shall normally attend meetings. The Chief Executive should be invited to attend, at least annually, to discuss with the Audit Committee the process for assurance that supports the Statement on Internal Control. Others may be required to attend as needed. At least once a year the Committee will meet with the External and Internal Auditors without any executive board director present. 2. Quorum Any two members of the Committee are required to be present. 3. Frequency Meetings shall be held not less than three times a year. The External Auditor or Head of Internal Audit may request a meeting if they consider that one is necessary. 4. Terms of Reference 4.1 Authority The committee is authorised by the Board to investigate any activity within its terms of reference. It is authorised to seek any information it requires from any employee and all employees are directed to co operate with any request made by the Committee. The Committee is authorised by the Board to obtain outside legal or other independent professional advice and to secure the attendance of outsiders with relevant experience and expertise if it considers this necessary. Date of issue: 1 st December 2008 Page 13 of 24

14 4.2 Duties The duties of the Committee can be categorised as follows: Governance, Risk Management and Internal Control The Committee shall review the establishment and maintenance of an effective system of integrated governance, risk management and internal control, across the whole of the organisation s activities (both clinical and non clinical), that supports the achievement of the organisation s objectives. In particular, the Committee will review the adequacy of: all risk and control related disclosure statements (in particular the Statement on Internal Control and declarations of compliance with the Standards for Better Health), together with any accompanying Head of Internal Audit statement, external audit opinion or other appropriate independent assurances, prior to endorsement by the Board the underlying assurance processes that indicate the degree of the achievement of corporate objectives, the effectiveness of the management of principal risks and the appropriateness of the above disclosure statements the policies for ensuring compliance with relevant regulatory, legal and code of conduct requirements the policies and procedures for all work related to fraud and corruption as set out in Secretary of State Directions and as required by the Counter Fraud and Security Management Service In carrying out this work the Committee will primarily utilise the work of Internal Audit, External Audit and other assurance functions, but will not be limited to these audit functions. It will also seek reports and assurances from directors and managers as appropriate, concentrating on the overarching systems of: integrated governance, risk management and internal control, together with indicators of their effectiveness. This will be evidenced through the Committee s use of an effective Assurance Framework to guide its work and that of the audit and assurance functions that report to it Internal Audit The Committee shall ensure that there is an effective internal audit function established by management that meets mandatory NHS Internal Audit Standards and provides appropriate independent assurance to the Audit Committee, Chief Executive and Board. This will be achieved by: February Specific terms of reference will comprise: consideration of the provision of the Internal Audit service, the cost of the audit and any questions of resignation and dismissal review and approval of the Internal Audit strategy, operational plan and more detailed programme of work, ensuring that this is consistent with the audit needs of the organization as identified in the Assurance Framework consideration of the major findings of internal audit work (and management s response), and ensure co ordination between the Internal and External Auditors to optimise audit resources Date of issue: 1 st December 2008 Page 14 of 24

15 ensuring that the Internal Audit function is adequately resourced and has appropriate standing within the organisation annual review of the effectiveness of internal audit External Audit The Committee shall review the work and findings of the External Auditor appointed by the Audit Commission and consider the implications and management s responses to their work. This will be achieved by: consideration of the appointment and performance of the External Auditor, as far as the Audit Commission s rules permit discussion and agreement with the External Auditor, before the audit commences, of the nature and scope of the audit as set out in the Annual Plan, and ensure coordination, as appropriate, with other External Auditors in the local health economy discussion with the External Auditors of their local evaluation of audit risks and assessment of the Authority/Trust/PCT and associated impact on the audit fee review all External Audit reports, including agreement of the annual audit letter before submission to the Board and any work carried outside the annual audit plan, together with the appropriateness of management responses Other Assurance Functions The Audit Committee shall review the findings of other significant assurance functions, both internal and external to the organisation, and consider the implications to the governance of the organisation. These will include, but will not be limited to, any reviews by Department of Health Arms Length Bodies or Regulators/Inspectors (e.g. Healthcare Commission, NHS Litigation Authority, etc.), professional bodies with responsibility for the performance of staff or functions (e.g. Royal Colleges, accreditation bodies, etc.) In addition, the Committee will review the work of other committees within the organisation, whose work can provide relevant assurance to the Audit Committee s own scope of work. This will particularly include the Board Assurance Committee and Clinical Governance Committee. In particular, the Audit Committee will monitor the process for establishing compliance with the Standards for Better Health. In reviewing the work of the Clinical Governance Committee, and issues around clinical risk management, the Audit Committee will wish to satisfy themselves on the assurance that can be gained from the clinical audit function Management The Committee shall request and review reports and positive assurances from directors and managers on the overall arrangements for governance, risk management and internal control. They may also request specific reports from individual functions within the organisation (e.g. clinical audit) as they may be appropriate to the overall arrangements. Date of issue: 1 st December 2008 Page 15 of 24

16 4.2.6 Financial Reporting The Audit Committee shall review the Annual Report and Financial Statements before submission to the Board, focusing particularly on: the wording in the Statement on Internal Control and other disclosures relevant to the Terms of Reference of the Committee changes in, and compliance with, accounting policies and practices unadjusted mis statements in the financial statements major judgmental areas significant adjustments resulting from the audit The Committee should also ensure that the systems for financial reporting to the Board, including those of budgetary control, are subject to review as to completeness and accuracy of the information provided to the Board Reporting The minutes of Audit Committee meetings shall be formally recorded by the Trust Secretary and submitted to the Board. Following each meeting, the Audit Committee will also submit an Isle of Wight Form to the Board and the Board Assurance Committee highlighting the main risk areas that have come to its attention. The Chair of the Committee shall draw to the attention of the Board any issues that require disclosure to the full Board, or require executive action. The Committee will report to the Board annually on its work in support of the Statement on Internal Control, specifically commenting on the fitness for purpose of the Assurance Framework, the completeness and embeddedness of risk management in the organisation, the integration of governance arrangements and the appropriateness of the self assessment against the Standards for Better Health. 5. Other Matters The Committee shall be supported administratively by the Secretary to the Board, whose duties in this respect will include: Agreement of agenda with Chairman and attendees and collation of papers Taking the minutes Keeping a record of matters arising and issues to be carried forward Advising the Committee on pertinent areas Date of issue: 1 st December 2008 Page 16 of 24

17 FINANCE & PERFORMANCE COMMITTEE TERMS OF REFERENCE The Finance Committee is a committee of the Board with responsibility to support the development of the financial strategy of the Trust, to review the strategy as appropriate and monitor progress against it. The group will oversee the financial activities of the Trust, including the short, medium and long term planning, the budget setting process, the LDP process and financial recovery. It will ensure appropriate, high quality Management Reporting and will monitor progress against plans and targets, with particular emphasis on current and forecast liquidity. It will approve and monitor the Capital Programme. It will highlight the major financial risks to the Board and the Risk and Quality Committee while providing proactive risk management within the areas of activity covered by its own remit. It will ensure the Trust is prepared for the forthcoming major changes including Investing In Your Health, Payment by Results and Foundation Status. In considering overall financial performance, the Committee will also oversee aspects of the underpinning activity performance of the Trust, along with responsibility for the enabling IM&T strategy for the Trust. Membership Core: Membership Invited: Non Executive Director (Chair) All other Non Executive Directors Chief Executive Director of Finance Director of Nursing Medical Director Director of Operations Director of Strategic Development Other Directors / Senior Finance and other managers as required 1. Quorum A minimum of five members should be present (including two Non Executive Directors and either the Chief Executive or the Finance Director). 2. Frequency and Timing The Committee will meet every month normally on the 3 rd Wednesday of the month. 3. Terms of Reference To be accountable to the Board for the overall operation of the Trusts financial health and IM&T strategy with specific reference to the following: Date of issue: 1 st December 2008 Page 17 of 24

18 3.1 Financial Planning & Financial Recovery To develop a robust medium and long term Financial Strategy for the Trust, including a recovery plan, to enable the Trust to achieve underlying financial balance within available resources and within the context of the Investing in Your Health programme To oversee the commissioning process and to monitor the Trust s work with commissioners ensuring sign off of the LDP (or its equivalent) in line with SHA timetable requirements. To develop plans to maximise income to the Trust To oversee the Trust s annual budget setting process and the preparation of a 3 Year Plan To review manpower plans To ensure that the Trust has integrated service, manpower, activity and financial plans. To enable the Trust to achieve underlying financial balance within such a timeframe as may be agreed from time to time with the SHA. 3.2 Financial Review To monitor progress against LDP and Income plans and ensure remedial action is taken where necessary To monitor in year financial plans, including liquidity and capital spending and ensure remedial action is taken where necessary To monitor progress against Manpower plans and ensure remedial action is taken where necessary To monitor progress against the Financial Strategy of the Trust To oversee development of the financial issues relating to Investing in Your Health, Payment by Results, and Foundation Status To monitor annual cost improvement, efficiency and savings plans To carry out a programme of Value for Money reviews 3.3 Risk Management The Finance Committee needs to finalise its role in relation to the overall governance arrangements operating in the Trust; specifically the Risk and Quality Committee and the Audit Committee. Until that time, the following responsibilities are identified: Ensure the risk register is adequately populated for Finance and IM&T risks. In conjunction with the Audit Committee, agree the timetable for the completion of the Annual Accounts. In conjunction with the Audit Committee, agree an action plan following the annual Auditors Local Evaluation (ALE) report and monitor progress. In conjunction with the Risk and Quality Committee, agree a Standards for Better Health action plan and monitor progress. To report to the Trust Board and the Risk and Quality Committee the major financial risks facing the Trust using an Isle of White Form. 3.4 Capital Management To oversee the work of the Capital Group and approve the capital programme To authorise individual projects over 500k in value Date of issue: 1 st December 2008 Page 18 of 24

19 3.5 Information Management & Technology To design, develop and ensure delivery of high quality, appropriate and timely Management Information and Reporting to all appropriate levels of management To oversee the work of the IM&T Strategy Committee and monitor progress against plans. 4. Reporting The Finance Director will provide a summary report of the financial position of the Trust to the Board on a regular basis. The Finance Committee will identify the key issues requiring Board consideration through a risk reporting form. In addition the minutes of the Committee meetings will be formally recorded and submitted to the next Board, together with a report of the key issues discussed. Date of issue: 1 st December 2008 Page 19 of 24

20 EXECUTIVE COMMITTEE TERMS OF REFERENCE 1. Purpose The EC is a forum for handling complex, major organisational issues. It will work within the strategic framework agreed by the Trust Board and characterised by robust debate argued in the context of Trust Board strategy, NHS priorities, local targets and requirements, accompanied by relevant evidence. It will ensure executive decision making and sign up to delivery through group and personal accountability. The EC will act in the context of corporate governance and the Trust Board can be assured that relevant issues will be aired, whether or not decisions are taken by the EC and reported to the Board or recommendations are formulated by the EC and made by the Board. 2. Status The EC is a formal committee of the Board. 3. Membership Executive Directors Deputy Medical Directors Director of Strategic Estates Head of Public Affairs The committee will be chaired by the Chief Executive or a Deputy Chief Executive. 4. Quorum A minimum of four members should be present, including the Chief Executive or a Deputy Chief Executive. 5. Frequency of Meetings Meetings will be held weekly. 6. Terms of Reference The duties of the EC cover the whole operation of the Trust and will include: 1. Delivery of the organisation s objectives and management of risks to those objectives. 2. Recommendations to the Board on strategic or sensitive issues 3. Advice to the Board on the development of and / or amendments to strategy 4. Implementation of strategy 5. Corporate business planning Date of issue: 1 st December 2008 Page 20 of 24

21 6. Managing Trust wide performance, anticipating and acting to deal with problems, and operating a no surprises approach, letting the Trust Board know in good time of relevant issues 7. Continuing to work to create an appropriate culture which values good (and better) clinical outcomes for individual patients and a relevant range of services for patients through appropriate and timely pathways; at the same time integrating these achievements with national requirements more commonly seen as targets 8. A mechanism for decision making and a forum for the more difficult decisions that cannot be reached elsewhere in the Trust, picking up issues referred from the Audit, Board Assurance and Finance Committees. 9. The EC will review all Board papers at the meeting preceding the Board meeting each month. 7. Reporting arrangements The work of the Executive Committee will be minuted but will be reported where appropriate through the Chief Executive s report, typically: as a decision made by the Executive Committee for Trust Board information, or as a recommendation from the Executive Committee for a decision to be made by the Trust Board. There may or may not be a separate Trust Board paper or as deliberations of the Executive Committee on significant issues whether on a one off or an on going basis. The monthly meeting at which Board papers are reviewed will be minuted on a more formal basis. Other meetings will be noted and actions circulated. 8. Support The Committee shall be supported administratively by the Secretary to the Board, whose duties in this respect will include: Agreement of agenda with Chairman and attendees and collation of papers Taking minutes Keeping a record of matters arising and issues to be carried forward Advising the Committee on pertinent areas. Date of issue: 1 st December 2008 Page 21 of 24

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23 Appendix 3 Board Reporting Form TO: FROM: DATE: Objective to which issue relates: Core Standard to which issue relates Risk / Issue for Escalation (up to six issues) Risk Score (H/M/L) On Risk Register Action for Board Lead Target date Date of issue: 1 st December 2008 Page 23 of 24

24 ISSUES BEING DEALT WITH BY THE COMMITTEE Date ISSUES OUTSTANDING FROM PREVIOUS MEETINGS Target Date Signed:..(Chair) FEEDBACK FROM BOARD / COMMITTEE: Date of issue: 1 st December 2008 Page 24 of 24