Good Governance in Organizations: Principles and Practices

1. Governance IkramulHaque Syed Associate IPS-Islamabad CEO Centric Consulting Director MP&Co Audit Firm Trainer-consultant AGPR

2. It’s a system System through which organizations are directed and controlled in the best interest of Stakeholders

3. System Set of interrelated component working together to achieve desired objectives

4. To direct…… • Set direction • Using established • Rules , regulations , Principles • Good Practice • Directing must be • Objective • Independent

5. To Control…. • Using the direction • Achievement of objectives • Maintaining Effectiveness • Achieving Efficiency • Controlling is • interest oriented • Dependent

6. Setting objectives Reason of existence Intentions Expectations of stakeholder Quantification Of Goals

7. Governance and structures Accountability Responsibility Transparency Information Governance Structure

8. What is governance? • Broadly, the way that power is taken on and used by the leaders of an organisation • Specifically for community based organisations, it refers to the structures and processes that are used to steer the organisation

9. ‘Good governance’ is… ‘A transparent decision-making process in which the leadership of an organisation, in an effective and accountable way, directs resources and exercises power on the basis of shared values’ A sharing of decision making so that power and resources do not accumulate in the hands of one person or a single group. What might ‘bad governance’ mean?

10. Shared decision making and individual accountability • The two take place together • Individual accountability for the group making the best decisions • Not a contradiction

11. Discuss: Who makes the decisions? • Who makes the decisions in your organisation? • How are they made? • How can others participate in this? • Do they participate?

12. Some more basic features of good governance • A basic form of accountability • Decisions are discussed and made collectively • There are restrictions on one person becoming more powerful than the others • This doesn’t happen accidentally, by chance or because of good will – it has to be formalised through rules and procedures

13. Let’s be practical… • Organisations with good governance will have: • A governing body (normally called a board) • Clear roles within this governing body • A system where the people on the governing body can and do change • A system where the roles within the governing body are chosen fairly and appropriately

14. In a ‘good governance’ … • There is a membership • There are regular elections for the board and nominations for all positions on a board • The board is voluntary and unpaid • There are clear and specific roles (president/chairperson, treasurer, secretary) • There are regular, minuted meetings • The meetings are organised in a standard format with regular reports on key issues • There are written procedures for how elections and meetings and for how conflict is resolved

15. Also… • If there is a coordinator, executive officer or secretariat responsible for the organisation’s daily business, they are accountable to the board • There is a distinction between governance (board, broad direction) and management (staff, everyday activity) • … sometimes this isn’t possible because the size or newness of the CBO means it doesn’t have staff… • But in this case it’s even more important that there be checks and balances on individual power – a separation of powers

16. Secretariats and boards • Role of the board: to set broad direction and oversee the general business (governance) • Role of the secretariat: to implement the board’s decisions and attend to the details in making things happen (management) • The relationship is mutual and reciprocal – a two way, supportive relationship • The secretariat supports the board’s development and decision making processes • The board supports the secretariat’s work in day to day management

17. Why good governance matters ? • Stability and reliability • Guards against corruption • Clear rules and procedures (transparency) • Accountability to communities/members • Sustainability and development • Diversity of views • Participation of more people • Guard against autocratic rule • Having structure to keep organisation focused on stated mission • And many more…

18. Governance in your organisation • Is there a governance structure in place? • If so, what is it? Does it work (in terms of what we’ve been discussing)? How does it work? How can it be improved? • If not, what do you think might be needed?

19. Governance manuals (by-laws) • Normally there are documents that set out the rules of an organisation’s governance structure – by-laws • The by-laws along with legal documentation (incorporation) and the mission statement as well as other documents communicate what the organisation is doing, how it’s doing it and where it’s going

20. A basic governance manual… • Membership rules • Board election processes • Responsibilities of the board • Board positions, criteria and duty statements • Terms of office for board members • Decision making and minuting procedures • Frequency and number of meetings per year • Meeting quorum • How meeting dates are set and agendas developed (and by who)

21. Developing a governance manual… • Takes time • Must be consultative • Engage the organisation’s members and/or constituents • Must be formally endorsed by the membership

22. Bringing all together… GOOD GOVERNANCE ACCOUNTABILITY TRANSPARENCY