David Marriott OUTSTANDING GOVERNANCE

 "If local democracy had worked, if local governing bodies had worked in the most challenging schools and for the most disadvantaged children, we would never have needed academies"  "Often governing bodies are the problem, actually“  Sir Michael Wilshaw  Head of Mossbourne academy, Hackney  New HMCI (Head of Ofsted) GOVERNING BODIES ARE THE PROBLEM… 05/08/2015www.thegovernor.org.uk 2

 “The new theology of the Coalition government is autonomy and choice…Governors are more important in a more autonomous system. Their ability to challenge and lead is the key.”  Sue Hackman  Chief Adviser for School Standards, DfE  MAKING A DIFFERENCE 05/08/2015www.thegovernor.org.uk 3

SPOT THE CONNECTION 1 05/08/2015www.thegovernor.org.uk 4

SPOT THE CONNECTION 2 05/08/2015www.thegovernor.org.uk 5

SPOT THE CONNECTION 3 05/08/2015www.thegovernor.org.uk 6

 Lord Turner, chairman of the FSA said there was a seventh factor in the bank's collapse - the "underlying deficiencies in RBS management, governance and culture which made it prone to make poor decisions".  "a pattern of decisions that may reasonably be considered poor, at the time or with hindsight, suggests the probability of underlying deficiencies in: a bank's management capabilities and style; governance arrangements; checks and balances; mechanisms for oversight and challenge; and in its culture, particularly its attitude to the balance between risk and growth." EG: RBS 05/08/2015www.thegovernor.org.uk 7

 “Corporate governance has been gaining more predominance around the world over the last decade. However the last year or so…has seen an unprecedented interest in some of the areas that are central to corporate governance: executive remuneration; boards of directors, independent non-executive directors; internal controls and risk management; the role of shareholders.”  Chris Mallin  Feb 2009 CORPORATE GOVERNANCE ISSUES 05/08/2015www.thegovernor.org.uk 8

 Rights and equitable treatment of shareholders  Interests of other stakeholders  Role and responsibilities of the board  Integrity and ethical behaviour  Disclosure and transparency  Source: the Sarbanes-Oxley Act, an attempt by the federal government in the United States to legislate several of the principals recommended in earlier Cadbury and OECD reports PRINCIPLES OF CORPORATE GOVERNANCE 05/08/2015www.thegovernor.org.uk 9

 published by the Financial Reporting Council in June 2010  The main principles of the code  A: Leadership  B: Effectiveness  C: Accountability  D: Remuneration  E: Relations with Shareholders THE UK CORPORATE GOVERNANCE CODE 05/08/2015www.thegovernor.org.uk 10

 Every company should be headed by an effective board which is collectively responsible for the long-term success of the company.  There should be a clear division of responsibilities at the head of the company between the running of the board and the executive responsibility for the running of the company’s business. No one individual should have unfettered powers of decision.  The chairman is responsible for leadership of the board and ensuring its effectiveness on all aspects of its role.  As part of their role as members of a unitary board, non- executive directors should constructively challenge and help develop proposals on strategy. LEADERSHIP 05/08/2015www.thegovernor.org.uk 11

 The board and its committees should have the appropriate balance of skills, experience, independence and knowledge of the company to enable them to discharge their respective duties and responsibilities effectively.  There should be a formal, rigorous and transparent procedure for the appointment of new directors to the board.  All directors should be able to allocate sufficient time to the company to discharge their responsibilities effectively.  All directors should receive induction on joining the board and should regularly update and refresh their skills and knowledge.  The board should be supplied in a timely manner with information in a form and of a quality appropriate to enable it to discharge its duties.  The board should undertake a formal and rigorous annual evaluation of its own performance and that of its committees and individual directors.  All directors should be submitted for re-election at regular intervals, subject to continued satisfactory performance. EFFECTIVENESS 05/08/2015www.thegovernor.org.uk 12

 The board should present a balanced and understandable assessment of the company’s position and prospects.  The board is responsible for determining the nature and extent of the significant risks it is willing to take in achieving its strategic objectives. The board should maintain sound risk management and internal control systems.  The board should establish formal and transparent arrangements for considering how they should apply the corporate reporting and risk management and internal control principles and for maintaining an appropriate relationship with the company’s auditor. ACCOUNTABILITY 05/08/2015www.thegovernor.org.uk 13

 Levels of remuneration should be sufficient to attract, retain and motivate directors of the quality required to run the company successfully, but a company should avoid paying more than is necessary for this purpose. A significant proportion of executive directors’ remuneration should be structured so as to link rewards to corporate and individual performance.  There should be a formal and transparent procedure for developing policy on executive remuneration and for fixing the remuneration packages of individual directors. No director should be involved in deciding his or her own remuneration. REMUNERATION 05/08/2015www.thegovernor.org.uk 14

 There should be a dialogue with shareholders based on the mutual understanding of objectives. The board as a whole has responsibility for ensuring that a satisfactory dialogue with shareholders takes place.  The board should use the AGM to communicate with investors and to encourage their participation. RELATIONS WITH SHAREHOLDERS 05/08/2015www.thegovernor.org.uk 15

 Who are our shareholders/ stakeholders?  What are our obligations to them and how well do we fulfil those obligations?  Does the GB have sufficient relevant skills and understanding to review and challenge management performance?  Do we induct new members effectively?  Is the GB an adequate size and are there appropriate levels of independence and commitment to fulfil its responsibilities and duties?  Is integrity a fundamental requirement in choosing our chair, vice chair, clerk and GB members (where we have a choice)?  Do we have a code of conduct for us and our leadership team that promotes ethical and responsible decision making?  Do we clarify and make publicly known the roles and responsibilities of the GB and school management to provide stakeholders with a level of accountability?  Have we implemented procedures to independently verify and safeguard the integrity of the school's financial reporting? Should we set up an audit committee?  Do we receive the information we need to carry out our scrutiny function in good time?  Is the disclosure of material matters concerning the school timely and balanced to ensure that all interested parties have access to clear, factual information?  Do we ensure collectively a satisfactory dialogue with our stakeholders and report to them regularly?  Do we self-evaluate regularly and use the outcomes to improve our performance? QUESTIONS FOR CORPORATE GOVERNANCE IN SCHOOLS 05/08/2015www.thegovernor.org.uk 16

 “This small-scale report was written to help governors reflect on their practice by considering the principles and approaches used by some of the best governing bodies.”  Available at  Also at SCHOOL GOVERNANCE: LEARNING FROM THE BEST 05/08/2015www.thegovernor.org.uk 17

 Positive relationships between governors and school leaders are based on trust, openness and transparency. Effective governing bodies systematically monitor their school’s progress towards meeting agreed development targets. Information about what is going well and why, and what is not going well and why, is shared. Governors consistently ask for more information, explanation or clarification. This makes a strong contribution to robust planning for improvement.  Governors are well informed and knowledgeable because they are given high- quality, accurate information that is concise and focused on pupil achievement. This information is made accessible by being presented in a wide variety of formats, including charts and graphs.  Outstanding governors are able to take and support hard decisions in the interests of pupils: to back the head teacher when they need to change staff, or to change the head teacher when absolutely necessary. KEY CHARACTERISTICS OF OUTSTANDING GBS 05/08/2015www.thegovernor.org.uk 18

 Outstanding governance supports honest, insightful self- evaluation by the school, recognising problems and supporting the steps needed to address them.  Absolute clarity about the different roles and responsibilities of the headteacher and governors underpins the most effective governance. Protocols, specific duties and terms of reference are made explicit in written documents.  Effective governing bodies are driven by a core of key governors such as the chair and chairs of committees. They see themselves as part of a team and build strong relationships with the headteacher, senior leaders and other governors. KEY CHARACTERISTICS OF OUTSTANDING GBS 05/08/2015www.thegovernor.org.uk 19

 In eight of the 14 schools visited, governors routinely attend lessons to gather information about the school at work. All the governors who were interviewed visit their schools regularly and talk with staff, pupils and parents. Clear protocols for visits ensure that the purpose is understood by school staff and governors alike. Alongside the information they are given about the school, these protocols help them to make informed decisions, ask searching questions and provide meaningful support.  School leaders and governors behave with integrity and are mutually supportive. School leaders recognise that governors provide them with a different perspective which contributes to strengthening leadership. The questions they ask challenge assumptions and support effective decision-making. KEY CHARACTERISTICS OF OUTSTANDING GBS 05/08/2015www.thegovernor.org.uk 20

 Governors in the schools visited, use the skills they bring, and the information they have about the school, to ask challenging questions, which are focused on improvement, and hold leaders to account for pupils’ outcomes.  Time is used efficiently by governors because there are clear procedures for delegating tasks, for example to well organised committees. These committees have clear terms of reference, provide high levels of challenge and use governors’ expertise to best effect. Systems are in place for sharing information and reporting back to the full governing body. This does not merely reiterate what has already been discussed in detail by the committee but focuses on the key points and decisions.  The role of the clerk to the governors is pivotal to ensuring that statutory duties are met, meetings are well organised and governors receive the information they need in good time. Consequently, governors come to meetings well prepared and with pertinent questions ready so that they are able to provide constructive challenge. KEY CHARACTERISTICS OF OUTSTANDING GBS 05/08/2015www.thegovernor.org.uk 21

 A detailed timeline of activities, maintained by the clerk and linked to the school development plan, provides a clear structure for the work of governors and ensures that their time is used appropriately.  Governors in the schools visited, use their external networks and professional contacts to fill any identified gaps in the collective skills of the governing body.  There are clear induction procedures for new governors which help them to understand their roles and responsibilities and ensure that best use is made of their varied skills and expertise.  The governing bodies constantly reflect on their own effectiveness and readily make changes to improve. They consider their own training needs, as well as how they organise their work. KEY CHARACTERISTICS OF OUTSTANDING GBS 05/08/2015www.thegovernor.org.uk 22

 How do we understand our roles and responsibilities and how they differ from those of the headteacher and senior staff?  What do we know about the achievement of pupils and the quality of teaching in the school?  How do we know that the information we have about our school is robust and accurate?  How do we provide the right balance of professional support and challenge for the headteacher and senior staff to help them improve the school’s effectiveness?  How do we use our time efficiently? QUESTIONS FOR GOVERNORS 05/08/2015www.thegovernor.org.uk 23

 How do we make best use of the skills and expertise of all members of the governing body?  How do we know that the governing body is as effective as possible and could we do things better?  How do we review our own performance regularly?  How do we plan our training and development?  Do we consider what might be needed when governors leave? How do we ensure we still continue to have the necessary skills and knowledge?  How do we ensure that members of our governing body are prepared to step into important roles such as the chair of the governing body and chairs of committees? QUESTIONS FOR GOVERNORS 05/08/2015www.thegovernor.org.uk 24

 New National Curriculum – delayed for a year  New assessment regime and methodology  Progress measures  No notice inspections from September  EBacc and its effects  How well deprived groups do  What happens when they leave?  Value for money – results vs expenditure; SFVS  What are your internal school performance indicators? NEW CHALLENGES 05/08/2015www.thegovernor.org.uk 25