Good Governance Series #4
Skills Comparison
Review of Governance in the Uniting and Presbyterian Churches (Queensland) and the Presbyterian and Methodist Schools Association
According to the Australian Institute of Company Directors (AICD) website, Resources/All sectors/Role of the Board, the board is responsible for the overall governance, management and strategic direction of the organisation and for delivering accountable corporate performance in accordance with the organisation’s goals and objectives. This responsibility is usually set out in the organisation’s constitution or in the enabling legislation under which the organisation is registered or incorporated.
The Uniting Church Schools Commission Queensland, in their Governance in Uniting Church Schools and Residential Colleges” document, states “Being a member of a Uniting Church governing body carries similar responsibilities to those carried by people who serve on the boards of Australia’s largest companies.
The only reference made by the PMSA regarding governance and roles and responsibilities is from the Council Manual Part A Section 4(a)(ii) By-Laws of the PMSA which states Subject to the law, the Constitution and these By-Laws, the Council is responsible for the good government of the business of the Association and the attainment and performance of the Association’s objects and may exercise all of the powers of the Association except those that are required to be exercised in general meeting.
No statement regarding governance or roles and responsibilities for boards or councils can be found for The Presbyterian Church Queensland including within the 532 page Presbyterian Church of Queensland Standing Orders and Rules and Forms of Procedure document. This document appears to have been updated in February 2015 and includes their Letters Patent dated 13 June 1876. This document explains the structure of the council, powers of the directors and councillors but not their responsibilities.
Board Skills Mix
The AICD (Role of the Board) states "the board needs to have a broad mix of skills, knowledge and experience. Different directors have different skills and backgrounds. The goal in selecting directors is to build a mix that can work as a well-rounded team of people each with an appropriate range of experience. In selecting a director, the board should consider the skills, knowledge and experience needed to govern the company both now and in the future. It is important to select people who have sufficiently broad experience in the issues and opportunities the company is facing now or is likely to face in the future. While specific skills required by each board differ, there are some core skills that should be represented on a board as a whole (not necessarily in one person). Additionally, if an organisation has special needs or exposure to a particular stakeholder group, it makes sense to include a director who has experience in that area. For example, a company that spends a great deal of time doing business with government may need someone with first-hand experience of the political process."
The AICD also refers to the ASX Corporate Governance Council Corporate Governance Principles and Recommendations regarding diversity on boards.
The following table shows the core skills required, as stated by the AICD, and those of the PMSA councillors and comparison organisations. Skill determination has been made based on the qualifications and experience of each board director/councillor.
In addition to the skills mix the AICD provides the following guidance on board selection:
Independence refers to directors who have true independence of mind in their deliberations as directors, and at least should not include those directors who may lack structural independence (that is, executives, substantial shareholders in the corporation or their representatives, and those representing corporations or businesses which are major purchasers or suppliers to the corporation), but without denigrating the value that such persons can contribute to a board.
The preceding information shows the PMSA Council has significant skill gaps both to those recommended by the AICD and also by comparison to other Queensland schools. The PMSA manages annual income nearly three times that of the Anglican Church Grammar School and Brisbane Girls Grammar School who both have a significantly stronger composition of board skills and qualifications.
It is also interesting to note the significant imbalance in representation between the Uniting Church (three representatives) and the Presbyterian Church (seven representatives). While Mr Graves would be seen as the key individual with knowledge in education, he has only recently joined the council.
Presbyterian Church Queensland and Uniting Church Queensland
Whilst an in depth assessment of every board and council that falls within the Presbyterian Church Queensland and the Uniting Church Queensland has not been undertaken, observations can be drawn to the stark difference in governance between the two churches. The Uniting Church has a more robust standard of governance in their approach to board selection criteria and process including maximum terms of nine years. It is difficult to find any information on the board selection criteria for the Presbyterian Church. The Presbyterian Church seems to have individuals with little to no qualifications and certainly many with qualifications that do not relate to the organisation they are charged with governing.
To provide a like for like comparison an assessment of the Board of Prescare and Uniting Care has been conducted as follows;
Summary
This review has been limited to the approach to governance, board skills and qualifications. A further review of risk management practices would enable a deeper understanding of key issues. Based on this governance review it is clear the Uniting Church Queensland has a sound and appropriate approach to governance. Information is readily available, up to date with current practices and it is clear to see it is applied by looking at the board selection and skills. The Presbyterian Church Queensland has little to no information on governance and the board selection, including the skills and experience of Presbyterian appointees to the PMSA, is significantly lacking.
The Australian Institute of Company Directors (AICD) provides free resources to assist organisations with good governance; as does the Governance Institute of Australia. The poor practices and documented approach of the Presbyterian Church Queensland could be quickly improved by simply leveraging the publicly available resources.
If one approach to governance was to be adopted it is highly recommended it is the Uniting Church Queensland’s. It is further recommended PMSA councillor selection and tenure adopts the Uniting Church Queensland approach as a minimum.
