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A good board should never rest on its laurels
Grenfell has demonstrated that boards need to recognise that good governance is an ongoing challenge, says Helen White
I was asked recently what would be my one piece of advice to other housing association board members. I’m afraid to say at this point it’s time to get comfortable with being uncomfortable.
Post Grenfell everything feels different. It’s a sad reality that our wonderful sector has finally been thrust into the limelight, but for all the wrong reasons.
That dreadful morning after, when the horrific reality of what had happened began to sink in, my inbox began to ping with messages from my fellow board members asking for information on our homes with cladding, and fire safety compliance. Our response, like many others, has been to act fast and move to reaffirm the assurances we had in place. We’ve taken steps to make sure our customers feel safe in their homes.
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Board members are quite rightly asking about the possible investment decisions we may need to take in the future as a result of Grenfell and how this needs to be factored into investment decisions we are taking right now. I’m pleased to say we are being proactive, grabbing the bull by the horns and doing what needs to be done.
For many organisations this will be a catalyst for important conversations about how the board takes assurance across all aspects of the business. This should be welcomed, however good organisations were already having these conversations, recognising that achieving good governance is an ongoing challenge and it’s a tough nut to crack.
What drives this type of ‘good governance’ behaviour shouldn’t be a response to a disaster. It shouldn’t even be a response to a regulatory requirement; it should just be what the board expects of itself.
“For many organisations Grenfell will be a catalyst for important conversations about how the board takes assurance across all aspects of the business.”
As chair of the Regulatory Board for Wales and chair of Knowsley Housing Trust in Merseyside, I can claim a foot squarely planted on each side of the fence, albeit in different countries, as both regulator and regulated. This has given me a great insight into the challenges on both sides.
It almost seems so obvious it feels odd to have to reiterate; that the responsibility for the strategic decisions regarding all areas of an association’s work lies with its board. These decisions need to be under-pinned by high-quality information from executives and independent sources when appropriate. They should also be supplemented by a robust approach to measures such as risk management, value for money and stress testing.
Our ability as board members to challenge, support and test the executive’s thinking is essential. This needs to be built upon a board assurance framework that meets and reflects the ambitions of the organisation. But this is so much more than a process issue.
Getting the right balance between accountability and empowerment will stem from the board and the executive setting the right culture.
Diversity around the board table is vital. Those involved with board recruitment need to challenge themselves not to recruit solely in their own image.
As associations continue to evolve and diversify we need to make sure our approach to governance keeps pace. If we want to innovate and adapt how we run the business, surely we need to innovate and adapt how we govern the business.
“As associations continue to evolve and diversify we need to make sure our approach to governance keeps pace.”
We need to challenge ourselves to be more open and transparent. As board members we need to get better at not only listening to each other, but also better at listening to our tenants and other stakeholders.
It sounds simple enough but we all know in reality it’s really difficult. At the Regulatory Board for Wales we spend a significant amount of time dealing with complex cases. No matter what the issue is, I guarantee you can link it back to governance, anything else is a symptom not a cause. It’s such a relief when we are told a board recognises and want to be engaged and proactive in tackling the problem. However, when I’m told the board has little grasp of the issue and in some cases refuses to accept a problem exists, my heart sinks.
Of all the board traits I witness, it’s those who bury their heads in the sand that are the biggest cause for concern. Now of course, I’m not saying every board has major problems they don’t know about, but I am saying all boards need to be acutely aware that no business is immune to, at best, a bump in the road, and at worst a catastrophic event.
Board members, if you’re not feeling a tad anxious or slightly uncomfortable it’s time to get real. Think everything is perfect? Look again, as I guarantee it won’t be.
Helen White, chair, Regulatory Board for Wales, and chair, Knowsley Housing Trust
