How do Members ensure effective governance in your trust?

Thursday 8th October saw the release of the latest Governance Handbook, which was accompanied by Academy trust Governance Structures and Role Descriptors for the first time.  

The new governance handbook includes a number of changes that bring it further into sync with the Academies Financial Handbook 2020 and all the guidance documents continue to focus on increasing levels of detail for those charged with governance to follow and adhere to.

In my experience, the members’ role has a very crucial part to play in governance, although rarely exercised as an intervention, it is such an important role. In the vast majority of cases and for the majority of the time, members are a silent witness to the good governance of boards operating the trust’s business. However, I have also seen recent examples of where members have had to step in and address a situation in the best interests of the schools, to remove trustees who have been operating outside their boundaries or where governance has become dysfunctional.

It is clear that the separation of layers of accountability continue to have focus and the role the Members within academy trusts has been clarified further than before. The guidance emphasises the need for them to remain informed about the trust governance and to assure themselves that the governance of the trust is effective and that trustees are acting in accordance with the trust’s charitable objects. In the majority of trusts this object is “to advance for the public benefit education in the United Kingdom”.

Powers of the members:

• Appointing and removing Academy Trustees
• Appointing and removing Members
• Directing Academy Trustees (under certain conditions)
• Amending the academy trust’s Articles of Association
• Appointing and removing Auditors

We know that separation between members and trustees is important and that independence is highly valuable in terms of accountability. We now have an ESFA regulation “must” confirming that members cannot be employees of the trust or occupy unpaid staff roles, best practice previously. The current model articles specify this but, there are still many who operate under original, older articles, where it is permitted under law, although a breach of the regulations and therefore funding agreement.

It is the role of the members to step in, if governance is failing, so how do Members stay informed?

Some academy trusts have the chair of trustees as a member. This is as far as any connectivity to the board should go, and the DfE specify that their “strong preference” is that at least the majority of the members should remain independent from the board.

The Governance Handbook is clear that it is for the academy trust itself to determine how best to keep Members informed, so that they can be assured the board is effective in governing the academy trust. Members do however need to:

• Keep informed of the skills the board need
• Have confidence in the board at all times “with sufficient arrangements in place for them to know when they need to exercise their powers”
• Be able to know when/if the board becomes dysfunctional – so as to know when to step in and exercise their powers – or know that the trustees are staking steps to address issues
• Ensure that trustees, or anyone charged with governance, knows how to escalate concerns to the Members, where any issue are not addressed by the board

If you would like to explore your trust’s ability to keep members informed, please contact us.