Company Secretaries’

Conference 2013

B9: The changing governance scene in education

and health – what can we learn from them?

Speaker: Tony Mears

University Secretary The University of Huddersfield

Active chair: Eric Summers

Head of Governance and Strategy, Fabrick Housing Group

Governance Models in Higher Education, NHS

Foundation Trusts & Social Housing

Speaker: Tony Mears

University Secretary

University of Huddersfield

Active Chair: Eric Summers, Fabrick Housing Group

Higher Education

Governance models are very similar, with variations on a theme

• The dualistic model with a Governing Board and a Senior

Management Team/Executive

• The Vice-Chancellor/Chief Executive is appointed by the

Board of Governors

• The overlapping membership being that of Vice-

Chancellor/Chief Executive and sometimes the Deputy Vice-

Chancellor and Pro Vice-Chancellors

• Some (more recent) institutions are also Companies Limited by

Guarantee

The University of Huddersfield

Committee Structure

COUNCILSENATE

Audit

* Governance

& Membership

Remuneration

* Honorary

Awards

School Boards

Teaching &

Learning

Research

Senior Management Team

Senate Committees * Joint Council/Senate Committees Council Committees (no staff

members but attendees only)

Health & Safety

Employment &

Finance

* Estates

Development

Joint

Consultative

Council

NHS Foundation Trusts

A Hybrid Governance Model with:

• A Membership Community comprising local people, patients,

carers and staff

• A Membership Council with elected governors from the

membership community and representatives from partner

organisations

• A Board of Directors with a Chair and Non-Executive

Directors, the CEO and Executive Directors

• An Executive Board comprising the CEO and Executive

Directors plus Clinical Directors The Membership Council and Board of Directors is Chaired by the Chair of the Trust

Social Housing

A further dualistic (but mixed) model:

• The dualistic model with a Governing Body (the Board) and

a Senior Management Team/Executive

• The Chief Executive is appointed by the Board

• Increasingly an overlapping membership with the CEO and

often the CFO as Non-Executive Directors

But then mixed models including stakeholder appointments

(tenants, LA representatives) representing historical influences

Challenges for Social Housing Boards

“New research reveals housing’s boardrooms are divided, as

executives and their boards fail to see eye to eye”

From Inside Housing ‘Strictly Boardroom’ (10 May 2013)

• Challenge of Co-Regulation

• Concerns about regulation in mixed economy i.e. ‘for profit’ as

well as ‘not for profit’ providers (HCA Consultation Paper, May

2013)

Challenges for Foundation Trusts

• Some trusts feel that governors can misinterpret the governor role,

perceiving it to be the same as the Non-Executive role

• Governors and trusts alike are concerned that governors may need

further training to equip them to take on the additional

responsibilities in the expanded role

• The term “holding the Board of Directors to account” is not defined in

legislation or by Monitor’s Code of Governance and can therefore be

difficult to interpret

• There is a critical role to play [for the Trust Secretary] in acting as

the first point of contact with governors and organising meetings and

all communications between directors and governors

Extracted from “Director-governor interaction in NHS foundation trusts:

A best practice guide for boards of directors”

(Monitor & PA Consulting, 2012)

Challenges for Higher Education Boards

• The reduction of government funding

• Growing complexity of HE, with continuing changes in

government policy, increased fees & competition,

research funding, encouraging widening participation,

quality of provision, added regulation etc.

• Managing the reduction in the size of boards &

committees

• Increasing the skills of board members to cope with the

additional demands

Challenges for all?

Corporate

Governance

Community

Governance

Business Effectiveness & Accountability

Meeting the Challenges

How can we meet these challenges?

Can we enhance the support for the Board

in that dynamic partnership of

Chair, Chief Executive and Secretary?

Perhaps we need a ‘tune up’ to help with this partnership?

Do you have a map? Supporting the Board towards its strategic goals

Is there enough fuel? Funding cuts & government policy changes

The road ahead is uncertain Student numbers/Research/Pay/Pensions/higher

expectations from students/shared services etc

What if the track goes off-road

or you have a puncture?

Is your risk management really up to speed!

When was the last service? When was your last governance review?

How soon might it need new

parts or that turbo charger?

How do you attract and develop Board members to

work in a dynamic environment?

Driving and navigating is a

partnership

Close working with the Vice-Chancellor and Chair of

Council – tripartite arrangement with the

Clerk/Secretary

Ideas on advanced driving skills Five suggested ways for a value adding Board

Some Considerations for Higher Education

Supporting the Board towards its

strategic goals in an uncertain future

Working together on the essential future strategy –

rolling 5-years plan?

• Production of a Strategy Map at Huddersfield

• Agree short, medium and long term goals

• Great for staff to engage with

• Suitable for a range of audiences

• Easy to measure progress

• Colour coding scheme quickly highlights areas

needing further attention

Funding cuts and Government

policy change

Ensuring financial sustainability in this dynamic

partnership

• Present your investment and borrowing strategy to

the Board at least annually

• Involve the Board in forecasting and scenario

planning

• Benchmarking your performance is valuable to give

the Board assurance on your institution’s progress

• Present each Board meeting with a detailed update

on your finances

Ensuring continuous engagement with your Board, not

just at meetings and away days but in-between them

• Create opportunities to discuss major topics at the

beginning of each Board or committee meeting

particularly strategic elements, with a protocol of

ensuring continuous engagement

• Include staff and student members

• Encourage Board members to visit the University and

meet with Senior Team (Non-Exec) members

• Work on a ‘no surprises’ basis with your Board

Supporting the Board towards its

strategic goals in an uncertain future

Does each agenda reflect the key matters for the Board/

Committee, or do they show only standing items, similar

to that produced 5 years ago?

• Plan the Board business far ahead

• Ask your Board members what they wish to discuss,

particularly for major items of discussion

• Do the papers look as though there is little to discuss -

can options be presented?

• SUPPORTING THE BOARD TOWARDS ITS STRATEGIC GOALS IN AN UNCERTAIN FUTURE

Supporting the Board towards its

strategic goals in an uncertain future

Is your risk management really

up to speed?

Are Board members really attuned to the risks of your

institution?

• Refine the risk management appraisal and control

systems:

- prioritise the raw risks

- state the control measures to address these with an

assessment of their impact

- show the residual risk and how it can be managed

• The Board can then judge how effective you are

• Risk management must dovetail with your Strategy

When was your last governance review?

Don’t wait for that major 5-yearly effectiveness/performance

review - undertake mini-reviews on specific areas

• The CUC publication ‘What is an Effective and High Performing

Governing Body in UK Higher Education’ outlines a range of

enablers and outcomes

• Review the number of your committees and how many times

they meet

• Remember that Governance extends through the whole

committee structure

• Are your regulations a barrier to making quick decisions –

review your structure/scheme of delegation

Is your Board or its committee too big for

useful major debates?

• Reflect on how beneficial small sub-group meetings

have been

• If so, consider a reduction in numbers (keeping staff

and student members), but ensuring that your

committees can be serviced

• A reduction can be managed over a number of years

Five suggested practices for a value

added Board

• Handle ‘housekeeping’ items more efficiently to free

up bandwidth

• Continuously improve the personal and professional

qualities of the Board

• Refrain from succumbing to outside, short term

hype and pressure

• Increase the interactivity between the BOD and EMT

(active dualistic governance)

• Allocate more focus and time on strategy, while

ensuring proper control From The Value Adding Board – its focus and work

TORBEN BALLEGAARD (2012)

Interesting links

Committee of University Chairs

http://www2.bcu.ac.uk/cuc/publications

Leadership Foundation for Higher Education

http://www.lfhe.ac.uk/en/audiences/governance/publications/index.cfm

Monitor: Independent Regulator of NHS Foundation Trusts

PA Consulting Group

http://www.monitor-nhsft.gov.uk/sites/default/files/Monitor%20-

%20Director%20govenor%20interaction%20report%20June%202012_0.pdf