Check the surface before you dive

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David JepsonWith the HCA looking to carry out deep dives on governance and financial control all board members should be reviewing how well they operate in these areas. Often problems arise not because of failures to spot complex issues, e.g. the rev counter seems to be running high, rather it’s the basics, e.g. we’ve run out of petrol!

From working in and with housing associations over the years here are a few things worth checking, more kicking the tyres than opening the cylinder head. First, in Board meetings who does the talking? If the Chief Executive speaks for more than 25% of the time you need to ask whether the non-executive members are getting sufficient airtime. Is the Chair making sure everyone has their say, do they sum up and clarify what has been agreed, do they get the balance between challenge and support of the executives right?

Do all the board papers come out, together, 7 days before the meeting? Really? Are there ever any substantive papers tabled? Are the papers so thick your heart sinks when they thud onto the doormat?

Are the minutes a brief and accurate summary of what was agreed or are they a rambling recounting of what was said? Think of an important decision you made between 6 months and 2 years ago. Write down what the decision was and what made you decide the way you did. Now look for the minute that sets out what was agreed. Can you find it? Does it match what you have written down? Does it provide a clear, unambiguous record of what was agreed and the key reasons for coming to the decision?

Now look at the paper that the decision was based on. If there was no paper and you relied on a presentation go back three squares. If you are being asked to make an important decision you must have a paper setting out clearly what the issue is, what risks are associated with the proposed and alternative courses of action, what the proposed route forward is, how the risks attached to that are to be managed. It should be comprehensive, clear and concise.

There are few issues that do not have financial implications. If the only numbers in a paper are the paragraph numbers, it is probably not adequate. However, you should not be presented with sheets of figures that cause the mind to numb and eyes to glaze. You want the essential numbers with a clear narrative.

Obviously, there is a whole lot more to good governance. However, if you recognise any of the above in your organisation, you need to take action now. Once you have checked the petrol tank, tyres and the steering wheel, to mix my metaphors, you can then dive under the bonnet!

David Jepson is an Associate Director at Altair, and can be contacted on david.jepson@nullaltairltd.co.uk | 07701 096 840.