Trustee effectiveness

Transcription

1 Trustee effectiveness Louise Thomson FCIS, Head of Policy (Not for Profit), ICSA: The Governance Institute 5 July 2017

2 What makes an effective trustee?

3 Session outline Role of trustees role of the chairman role of individual trustees hallmarks of a successful trustee board Trustee composition and succession planning Principles of sound decision-making Effective meetings Evaluating trustee performance

4 Who is a trustee? The persons having the general control and management of the administration of a charity - Charities Act 2011,s177

5 Legal duties of trustees CC3: The essential trustee: Ensure your charity is carrying out its purposes for the public benefit Comply with your charity s governing document and the law Act in your charity s best interests Manage your charity s resources responsibly Act with reasonable care and skill Ensure your charity is accountable

6 Chair: first amongst equals?

7 Role of the chair a few examples Leading the board, ensuring it discharges its duties and responsibilities Setting a board agenda which is primarily focussed on fulfilling the charity s objects Building and developing the board and individual trustees Ensuring proper constitutional and governance arrangements in place Ensuring the board has appropriate support, information and evidence Contributing to building a shared vision of the aims, values and culture Overseeing governance, ensuring board transparency and responsiveness Ensuring meaningful stakeholder engagement and accountability

8 Trustee contribution and commitment Induction Meeting attendance Contributing to meetings Ongoing communication outside of meetings Training and development days Strategy sessions Stakeholder events Board evaluation

9

10 Hallmarks of an effective board The board of trustees will provide good governance and leadership by: Understanding their role Ensuring delivery of organisational purpose Working effectively both as individuals and as a team Exercising effective control Behaving with integrity Being open and accountable

11

12 Trustee recruitment, composition and succession Governing document Charity and company law Skills audits Open and evidenced processes Diversity Due diligence Induction Review Tenure

13

14 Diversity in the boardroom Critical assessment Sound judgement Courage Independence of thought Openness Honesty Tact Humility Flexibility in thinking Ability to listen Ability to forge and build productive relationships Ability to develop and inspire trust

15 Boardroom diversity: What does it mean to you?

16

17 Why diversity matters Role models Life experience Better challenge in the boardroom Increased knowledge Better decisions Reach wider audiences Challenges perceptions Added legitimacy

18 Diversity is a solution to a competency problem

19 Principles of sound decision making Charity Commission guidance states that trustees must: Act within their powers Make decisions, and act, in the best interests of the charity, its current and future beneficiaries Be appropriately informed of all relevant factors relating to a significant proposal under discussion Not be swayed by personal interests or factors that are irrelevant Be able to defend their decisions in terms of their legal duties and powers

20

21 Good decision making facilitated by: Ensuring participants are afforded time to prepare for meetings High-quality board packs Obtaining expert opinions when necessary Allowing time for debate and challenge, especially for complex, contentious or charity-critical issues Achieving timely closure Providing clarity on the actions required, including timescales and responsibilities

22 Factors adversely impacting good decision making A dominant personality or group of trustees on the board which can inhibit contributions from other trustees Insufficient attention to risk, and treating risk as a compliance issue rather than as part of the decision-making process Failure to recognise the reputational implications of trustee decisions and the actions arising from those choices A reluctance to involve trustees, or viewing the trustee meeting as a rubber stamp to approve decisions already made Complacent or intransigent attitudes Weak organisational culture Inadequate information or analysis

23

24 Effective meetings The overriding purpose of the law of meetings is to ensure that those who are entitled to participate in the company s decision-making process are given a reasonable and fair opportunity to do so but also to ensure that decisions can be made by a majority of those who actually choose to participate. The Law and Practice of Company Meetings, A. Hamer, ICSA Publishing 2013

25

26 What are the key factors in delivering an effective meeting?

27 Time and frequency of meetings Agendas and corporate planning Minutes Managing conflicts of interest/loyalty Behaviours and attitudes Preparedness Constructive challenge Decisions and resolutions

28 Benefits of a skilled chair An adept chair can facilitate an effective meeting by: Focussing on what the meeting must achieve and gain commitment to the agenda Establishing the ground rules Using a business-like style (timely, focussed, maintaining gravitas) Being inclusive and non-partisan, allowing trustees to participate Offering an overview of the task but avoiding beginning with their own view or questions Steering discussions in a structured way; managing time and personalities Testing comprehension; paraphrasing and checking back Building on contributions to reach consensus Summarising and repeating actions to be taken before moving to the next agenda item

29

30 Self-reflection and evaluation

31 Board evaluation Desk top research - current governance systems and how effective they are Questionnaires providing a first cut of information that will feed into any faceto-face interviews Open interviews useful if there has been any board changes Board observations these may be seen as creating a false environment 360 degree feedback within boardroom and beyond? Marzipan layer input helpful for succession planning Peer practices benchmarking against similar entities Skills audits highlighting collective strengths and areas for improvement

32 How would you deal with a rogue trustee?

33

34 Thank you