Best Governance Improvement Initiative Award Entrant:
The Issue: A new Governance Structure
Just over three years ago, Extern’s auditors advised the organisation that a new Governance structure was needed due to an overlap between the two existing Boards (Extern Ireland and The Extern Organisation). Today, there is Extern Ireland, Extern Northern Ireland, Extern Supporting Communities and Extern Group.
This extensive restructuring presented Extern Ireland Trustees with a challenge, in that they felt they needed clarity not only in relation to their obligations and responsibilities within the new Group structure, but also with regards to leadership ahead of setting the new strategy for Extern.
As a result, the Chair of Extern Ireland felt strongly that a Governance Action Plan (GAP) be developed to ensure members would be:
- Fully trained and aware of their legal and collective responsibilities within the new structure and in adhering to the Governance Code.
- Equipped to play their part in ensuring transparency and accountability for the organisation.
- Assured and confident in setting the new strategy for the organisation.
Action Taken: Developing a new Governance Action Plan
Leading Governance was initially appointed to work with the Board to review governance and board effectiveness, and to create a Governance Action Plan and tailored Governance Manual.
The last 18 months, however, have seen this work developed further.
Improved Induction and exercising of control:
- Today, new Trustees are taken personally through the new Extern Governance Manual by the Chairman. Recruitment is now by public advertisement and in line with any identified skills gaps.
- The Governance Manual consists of 32 chapters, including Extern’s Constitution, Policies (Risk Management, Conflicts of Interest, Gifts and Hospitality etc), Code of Conduct, Matters Reserved for the Board, Escalation Procedure.
- They also meet the Strategic Leadership Team and the Chairman of the Audit and Risk Committee, who goes through the annual report/accounts, most recent budget, and Risk Register. They also meet the CEO and undertake at least one site visit.
- Members wanted more time to deal in-depth with strategic issues/planning, and to reflect on issues in the wider operating environment. A new meetings structure and Committee Terms of Reference were created. Now four meetings are held each year (with additional meetings if necessary), with accompanying meetings of the Audit and Risk and Business Development Committees, along with two ‘Away Days’ for in-depth/strategic planning and a meeting of the Nominations and Remuneration Committee.
- Extern’s GAP includes commitment to on-going development of the Boards as teams, and of the individual members of those Boards, using an ILM accredited framework.
- An annual review process looks at performance as individual members and as teams. The Chairman meets each member to review their contribution. Team reviews take place at Away Days & there’s reflection on board team dynamics.
- Five Extern Trustees and the CEO of Extern have completed the ILM Level 5 Award in Leadership and Management – others have completed units.
- September 2018 will see the first ‘Soundbite’ sessions for the Board, whereby key sectoral topical issues will be explored.
- As part of our GAP, Stellar Leadership Ltd was engaged to facilitate a strategy setting workshop for the Board and committees.
- The Board identified five strategic aims – setting the organisation’s direction until 2019. Extern’s senior team develop operational plans towards these five aims – the Balanced Scorecard is the reporting mechanism and Trustees discuss the achievement/non-achievement of objectives, along with any changes needed to operational plans/budgets.
The Impact: Results matter
The Board’s increased confidence and knowledge, as an outcome of our GAP, resulted in increased confidence in setting stretch targets and ambitious aims as part of the new strategy, and also in delivering support for senior management to enable them to put in place the operational capacity and resources to achieve these targets.
- As a result, Extern was able to support over 18,000 people last year. That’s 4,000 more than the year before. Our Trustees are also confident we will reach more this year.
- We feel that is powerful and tangible testament as to the positive impact our Governance Action Plan has had on the implementation of our mission and on those people who need our support the most.
…Extern Ireland: Changing Lives Every Day…