Altair Consultancy and Advisory Services Ltd (Altair) has carried out a comprehensive research study to explore best practice in governance for Large Scale Voluntary Stock Transfer (LSVT) associations.
The report comes at a time when many LSVT associations are looking to respond appropriately to the HCA’s revised Regulatory Requirements and NHF Code of Governance (2015), while many are also diversifying their activities into more commercial sectors. Although these circumstances are faced by all housing associations, the nature of LSVTs, and the constituency model upon which they were founded, means that addressing these increasing pressures requires a wider set of considerations.
‘This is an important, well written report and as the pressure on boards to ensure they have the right skills increases is also timely’. Said David Orr, speaking at the report’s launch this evening.
The study, which was commissioned by Magenta Living, Incommunities and Bolton at Home, identifies the trends and learning points of different governance models and approaches that have been recently adopted by a number of LSVT associations. The research has drawn upon a range of resources, including a recent survey undertaken by the National Housing Federation.
The key findings of the research are as follows;
- Many LSVT organisations have adjusted to changing circumstances, developing their role and purpose beyond the initial promises made to tenants at transfer. There has been a range of approaches taken to board composition for maturing stock transfer organisations. Many have also introduced board pay, streamlined their arrangements, and reduced the size of their board to enhance and supplement their approach.
- LSVT associations who have retained the ‘standard’ constituency model usually adopted upon transfer face specific challenges in their governance arrangements, particularly in ensuring that they have access to suitable skills to manage complex risks.
- In particular, the ‘golden share’, which exists for some but not all LSVTs, was seen as a significant barrier to change if the authority did not want to relinquish its influence over the association. In addition, an anomaly continues to exist in some group structures where golden shares have remained in subsidiaries. For several LSVTs this remains a significant obstacle and can mean that the primacy of the parent is not clear or consistent
The final conclusions are as follows;
- To support future LSVT organisations government should place emphasis on the need for adequate skills when transfer organisations are created. The transfer manual should be revised to reflect current expectations and demands on all providers, as well as good practice in governance more widely.
- Now is the time to ensure that LSVT organisations have access to the right range and depth of skills, knowledge and experience. Those who do not adjust to the challenges they face are likely to find the capacity, viability and adequacy of their organisations’ governance threatened and their effectiveness and resilience undermined.
For more information please contact Steve Douglas: firstname.lastname@example.org, 020 7934 0175