1. CCEC Governance Seminar Improving Organizational Performance with Sound Governance Hopkins & Associates Inc. 41 Leatherwood Crescent Winnipeg, MB R2G 3N1 204-269-5077; hopkins@mts.nethopkins@mts.net

2. CCEC HOPKINS & ASSOCIATES Legal Issues  A Director is a Director is a Director...  Publicly traded firms  Privately held firms  Crown Corporations  Not-for-profit and Non-profit organizations  The Objects will vary but not the responsibility

3. CCEC HOPKINS & ASSOCIATES What Is Board Governance?  Description  definition of leadership, stewardship and management roles, responsibilities and relationships  formalization and codification of practices  defines “who does what”

4. CCEC HOPKINS & ASSOCIATES Carver Model  Carver’s model has 4 areas of particular relevance: 1. Board’s responsibility to test Mission and Vision  Are Management’s plans congruent with the Mission & Vision?  Are the results of those plans furthering the Mission & Vision?  Are continuously altering external circumstances driving a need to alter the Mission & Vision?  Are the Mission & Vision central in the organization’s thinking and actions?

5. CCEC HOPKINS & ASSOCIATES Carver Model 2.The relationship between the Board and CEO  defining the CEO’s authority by placing limits e.g. capital expenditures; size/duration of contracts; matters which affect the public; etc. 3. The Board must focus on ends not means 4.The relationship between the organization and its key stakeholders  Openness, transparency, integrity, consistency

6. CCEC HOPKINS & ASSOCIATES Carver Model  Non-Profit Boards work for either a vaguely defined group or a well-defined though difficult-to-communicate-with group (or both)  Carver can be harsh: he calls most non-profit Boards “incompetent groups of competent people”

7. CCEC HOPKINS & ASSOCIATES The Conference Board of Canada  Research linking sound governance practices to improved organizational performance  Governance programs for Not-for-profit organizations, Crown corps and for-profit companies  Identified roles and responsibilities of shareholders, the Board, individual directors, committees, CEO, etc.

8. CCEC HOPKINS & ASSOCIATES The Toronto Stock Exchange  The TSE reporting requirements

9. CCEC HOPKINS & ASSOCIATES Leighton and Thain  Who are they?  Why are they relevant?

10. CCEC HOPKINS & ASSOCIATES Governance Principles  Why Are They Important?  Many key decisions will flow naturally from the governance principles including:  the relationship between the Board and CEO  committee structure  board processes  communications policy/reporting style

11. CCEC HOPKINS & ASSOCIATES Examples of Governance Principles for Non-Profit Organizations Transparency Fairness Integrity Effectiveness Politically sensitive but apolitical

12. CCEC HOPKINS & ASSOCIATES Examples of Governance Principles for Non-Profit Organizations Accountability Full Board makes decisions Clear delineation of responsibilities Responsibility to the community Consultation with key stakeholders

13. CCEC HOPKINS & ASSOCIATES Example of Governance Principles Conference Board of Canada recent publication “Who Does What” identifies 6 governance principles: 1. leadership & stewardship 2. empowerment & accountability 3. communication & transparency

14. CCEC HOPKINS & ASSOCIATES Example of Governance Principles Conference Board of Canada recent publication “Who Does What” identifies 6 governance principles: 4. service & fairness 5. accomplishment & measurement 6. learning & growth

15. CCEC HOPKINS & ASSOCIATES The Board’s Basic Responsibilities 1.directing and supervising strategic management. 2.appointing and overseeing the CEO (and other officers) 3. representing shareholders and maintaining shareholder relations (substitute stakeholder)

16. CCEC HOPKINS & ASSOCIATES The Board’s Basic Responsibilities 4. protecting and enhancing the company’s assets 5. fulfilling fiduciary and legal requirements 6. managing risk 7.communication policy 8. integrity of internal controls & MIS

17. CCEC HOPKINS & ASSOCIATES A Director’s Responsibilities  What Are A Director’s Responsibilities?  Aspects and Qualities of a Good Director

18. CCEC HOPKINS & ASSOCIATES Sharing Responsibility Between the Board and Management  This is where most organizations get into trouble.  Why?

19. CCEC HOPKINS & ASSOCIATES Question to Ponder  Has your Board assessed its performance?  Can you easily describe your governance system?  On what principles does it rest?  Is there a clear delineation of responsibility between the Board and Management?  Are Board committees organized around the Board’s responsibilities or congruent to operations?

20. CCEC HOPKINS & ASSOCIATES Question to Ponder  Is the Board’s mandate clearly described?  Are there job descriptions for the Chair, CEO and a director?  Are limitations on the CEO’s authority clearly spelled out?  Do you have a CEO performance assessment that is fair, thorough, inclusive, transparent and easily understood by all

21. CCEC HOPKINS & ASSOCIATES Question to Ponder  Do you have a strategic plan?  Are the business plan, CEO and senior management objectives aligned with the strat plan?  Do you have a risk assessment and mitigation process?  Are there adequate succession plans for the Board Chair, Directors, the CEO and senior management?

22. CCEC HOPKINS & ASSOCIATES Question to Ponder  Do you have Board policies on such matters as communications, human resources and the environment?  Do you a comprehensive director orientation and continuing education program?  Do you have a policy regarding information that the Board requires?  Have you developed an Annual Calendar of Events?

23. THANK YOU!