Governance: some people know what it is; some people have never heard of it; some go to sleep when they hear the word; other people ask ‘how do you spell that?’ It conjures up a range of reactions and emotions.
People tend to fear what they don’t understand. The natural instinct is to be negative or think it’s something specialised which needs an expertise which they don’t have.
Well the good news is that governance is for everyone! It’s actually very simple and a bit like DIY. Once you know the basics, know what questions to ask you can usually find the answers to help you somewhere on the internet.
OK, now that you’ve got over the fear factor let’s get down to talking about governance or to give it its full name, ‘Corporate Governance’.
The word ‘governance’ not surprisingly is derived from the word ‘government’. What’s the purpose of government? Contrary to popular belief it’s not there to tell us what to do. The main purpose of government is to protect us, ensure we are safe and to create the type of society that people want to see. In doing this they’ll pass various laws to help achieve that vision. Unfortunately, most political parties tend to concentrate on new policies and laws and never really describe the vison so we have politicians arguing about issues of detail.
So what’s this got to do with the Supporters Trust I hear you say? Well, as a new organisation our fundamental role is to create that vision for members and then ensure we have various rules and regulations to help us achieve it and to protect the organisation. Corporate Governance is intended to increase the accountability of the organisation to its members and avoid massive disasters before they happen. Simple isn’t it!
Most companies are established under the Companies Act and the board of directors who run the organisation have to adhere to various rules and regulations which the Government have put in place to protect the owners, the so called shareholders.
In the case of the Supporters Trust, we were established under the Co-operative and Community Benefit Societies Act 2014 and are overseen by the Financial Conduct Authority. No money can be distributed to shareholders and also funds have to be used by the Trust for the benefit of the community. All the directors are volunteers and do what they do in order to help Cardiff Rugby be successful.
So what do we need to do in order to both develop and protect the organisation? Well, the fancy term for this is to have a ‘Corporate Governance Framework’. You can find all sorts of stuff on the net telling you what this looks like but it broadly comprises 6 areas which need to be considered:
There’s an old adage which says ‘Its people who make things happen’ and that’s absolutely true. We therefore need a range of good people with a mix of skills on the Board – financial, organisational, marketing, IT etc. Most important, we need people who are prepared to put in time outside of formal meetings and people with a positive ‘can do’ attitude. Like any organisation they need training and development to understand both their role and responsibilities.
Every organisation needs to know what it’s trying to achieve and how it’s going to achieve it. This is all a vision needs to be; it doesn’t need to be a glossy publication. Importantly, the company also needs to decide the way in which it will work – its principles, ethics and values. What things it puts great store in and what it’s not prepared to do.
Structures, Systems and Procedures
It goes without saying that it needs procedures in place for spending money and taking money in. Who has responsibility for these and what checks need to be put in place to safeguard the company. The same applies if staff are employed. They need rules to know what they can and cannot do.
Accountability and Openness
Everybody is accountable to somebody. The Trust is accountable to supporters who are members of the Trust and to organisations with which we work. It’s important to be open and honest and communicate with them on a regular basis to tell them what’s going on and what’s being achieved.
Communications isn’t just about putting out good news stories and telling people how good we are, although that is important. It’s also a major contributor to the accountability point discussed above. Asking questions like: ‘who do we need to speak with?’; ‘who do we need to involve?’; ‘who needs to know?’.
Safeguarding the Reputation of the Organisation
If an organisation gets a bad name, for whatever reason, it’s potentially the beginning of the end. Organisations need to consider what risks they face. These could be financial, PR, data protection, health and safety, child protection etc. Everyone company will face different risks.
So there we have it a simple guide to corporate governance. The Trust has developed an action plan to ensure that we are putting all of the above in place. Progress on implementing this plan is considered at every working group meeting so that everyone is aware what is in place and what isn’t.
The Trust is a democratic organisation and if members don’t agree with what the Board is doing then they can vote members out and new ones in. But whoever is voted in will need to be aware of these governance principles and ensure they are in place.