5 Top Tips for working with a Board

 

I’ve been thinking about Boards.  There seems to be such a spectrum of relationships, responsibilities and behaviours of Boards, either because of or even despite the requirements of Company Law, that I thought it might be helpful if I gave some ‘Top Tips’ on how to work with Boards, based on  our experience of working with many clients and their boards, as well as with our own.

The first thing to say is that for anyone wrestling with the role and relationship of a Board with your company, there are certain requirements laid down by law that have to be in place.  You can find material on these here:  http://knowhownonprofit.org/basics .  It’s a site run by NCVO and therefore is not arts specific but I think you and your Board members will find it useful.  (I tried ACE’s site but everything seemed to be out of date and inaccessible.  Keep an eye on it, though.)   There is also a very useful document called Cre, Diligence and Skill, produced and updated by the then Scottish Arts Council – well worth a read:  if you can’t find it online, contact Dawn@cida.org and she’ll send you a copy. This blog, however, is really about the reality of managing the relationship with your Board, assuming they know what their statutory duties are.

Essentially, the Board of Directors is the governing body of a not for profit organization. The responsibilities of the board include discussing and voting on the highest priority issues, setting organisational policies, and hiring and evaluating key staff. Board members are not required to know everything about the management of a not for profit organisation, but they are expected to act prudently and in the best interests of the organisation. They approve operating budgets, scrutinise management accounts and financial management practices, and establish long-term strategic plans.

That’s easy to say – sometimes harder to do.  Most creative organisations are set up by one or two individuals who have conceived the idea and, through their passion and commitment, have driven the idea into reality.  The day comes when the organisation is sufficiently successful that it recognises the need to secure the protection of formally constituting.  This is where the Board comes in and everything changes.  The visionary leader is no longer in control of the organisation.  The law requires that the Board assume that control and that responsibility.  Plans have to be presented, discussed, approved and minuted as such.  Records of minutes have to be kept as the history of the organisation, and against a situation where serious dispute or difficulty arises.  The freedom of decision making by the visionary leader no longer exists.   It can be a tricky time of adjustment.

It’s fair to say that most new Boards will recognise this potential tension and will be empathetic.  However, it’s not something that you can take for granted.  When you are making that move into formal constitution and selecting your Board members, be very careful about your expectations of that Board and be very clear to them about what you expect.  It’s astonishingly easy to end up with at least one member of the Board who wants to assume a strong interventionist role, confusing his role with that of the executive (you!).  After a particularly unhappy experience with one Board of a company I set up, I left and, the next day, this bull of a man stormed into the office roaring “Let me have no more visionaries about me”.  Well, to share my experience of schadenfreude, let me tell you that he got his way – and the company later collapsed.

What had happened in that particular case was that I had built a very high profile project that needed a lot of funding and influence, even up to Cabinet level.  So when it came to setting up a Board, I thought that I needed a Board of the Great and the Good.  Unexpectedly, it became a Board that it was fashionable to belong to, and we had no difficulty in recruiting eminent people of power and influence.  My difficulty was in developing the relationships with them that allowed me to share ideas and goals, instead submitting them for approval.  It’s a critical difference.

So Top Tip No 1 is: always ensure your Board members understand and empathise with your mission, vision and values before they join.

Once they join, they will in time want to help you articulate and shape the vision, and that can be both challenging and rewarding.  But if they don’t believe both in what you are doing and why you are doing it, then you are heading for real trouble in due course.  All the business skills and contacts in the world are a complete waste of time if they do not get and support the fundamentals of your organisation.

On the other hand, Top Tip No 2 is: do not, for goodness’ sake, get a Board of people who are just going to say yes to you all the time.

It’s very easy to do.  You are so keen to protect your idea that you think that a group of your friends, and even colleagues, are the best people for the role.  But, generally speaking, they aren’t.  We have a Company Secretary, Keith Arrowsmith, on our Board (whom, incidentally, we recruited through Arts & Business Board Bank) whom we all adore.  He’s a specialist in Creative and Media IP so fabulously helpful to our work.  He’s an unconventional lawyer in that he speaks everyday English and never drowns us in legalese. He’s also extremely witty.   But we all know that, when we are presenting a new project or scenario, he will be the one that will trip us up if we haven’t prepared properly.  He does it gently.  He always goes last, waiting for everyone else to have their say, and then, with the sweetest smile, he will just gently ask” And what will happen if….” If we’re not ready, everything comes to a standstill!  He says of himself “I’m here to ask the awkward questions”.  It’s true and he does.  But we never feel threatened by it – quite the reverse.  We might feel furious that we haven’t thought of it first, of course, but his approbation is important to us.  His commitment to the company is never in doubt and we feel confident that his questions make our ideas stronger.

Top Tip No 3:  discuss and agree the kind of relationship you expect with your future Chair before you invite him or her to chair your organisation.  I say that with feeling, partly because I’ve never done it.  However, having had simply wonderful Chairs in CidaCo since we started, I realise that it’s been more by luck than judgement.  So I want to recommend to you all that it’s worth having this discussion before you appoint.  Ric Green, our Chair at present, is infinitely wise, considered, perceptive and probing.  He never ever issues instructions and is both supportive and facilitative.  Sometimes, that support is given through questions and observations that make us rethink our propositions; often, it’s done in advance of Board meetings so that we can avoid elephant traps!  He’s very watchful during the meetings, observing how different people are reacting to the discussions, and has an unerring eye for levels of discomfort and disagreement which he will usually insist on being articulated.   Our Board meetings are not cosy, by any means, but they are intelligent, informed and informative.

Top Tip NO 4 is: do not confuse the roles of the Board and the Executive.   I heard a complete horror story the other day where the Board retain all control of the finances, even to the approving and signing of cheques over £50 (this is an organisation with over £500k turnover); where the executive are obliged to send them a weekly report on activities; and where the Board issue instructions for the executive to carry out.   There is history here which has given rise to this:  the organisation was hit by a serious fraud, perpetrated by an employee (despite the fact that there were forensic accountants on the board, but that’s another story!).  The Board at the time resigned en masse and the new Board came roaring in, determined to ensure such a thing could never happen again.   However, their authoritarian approach effectively positions the executive as children and is utterly reprehensible.

Of course, Boards who don’t or can’t be bothered to meet, don’t read the papers, and don’t engage with the life of the company, are equally unhelpful.   Many years ago, I was called in to help a very well-known Theatre Company in the South East that had suddenly been found to be in difficulties.  The thing is, it is very rare that an organisation suddenly hits difficulties.  Usually, difficulties build up over a period of time – the signs are almost always there well in advance.   It transpired that this theatre company’s Board met only once a year; the Board meeting lasted less than an hour, with the CEO blandly doing all the talking; and always ended with the CEO opening up the whisky cabinet and a good time was had by all.  But no one outside knew that.  All you ever heard about was a theatre doing interesting work, playing to good houses, and offering a good time to any VIPs or assessors who turned up.   Even a cursory glance at the figures showed a very different story.   In the end, on that occasion, the company was baled out by the Arts Council (it was years ago!) but an early condition of rescue was that the entire board resign.

Top Tip No 5 is: identify the skills you need before you identify the people you want on your BoardIt’s pretty much a general rule that all Boards need financial, legal and marketing expertise.  Then there will be other knowledge, skills and networks that you need: e.g. particular sector expertise, both public and private; expertise in HR, in the environmental agenda, in new technology and in fundraising; and, of course, most arts organisations will want artists on the board to keep the creative focus.   Therein lies the rub:  there is a risk that non creative sector board members fall in love with the artists and with the work and forget why they are there.  In Graham Devlin’s report on governance for the Arts Council, there’s a lovely story about “the boards of arts organisations are made up of the cleverest, most able business people in the country who give up their time to support the arts, come to the Board meetings ………and leave their brains at the door”.  Make sure your Board members don’t do that:  be clear about why you have invited them, what you expect from them and get agreement from them about their responsibilities, both general and specific, towards the organisation.  Of course they should have fun and of course they should support the work and get to meet people in the company, but their first duty is to bring their expertise to help the organisation function efficiently, effectively and sustainably.

There’s much more to say on this, of course, but if you remember those five Top Tips, you should be able to develop relationships of trust and respect, the absolute prerequisites for fruitful partnership.

 

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