Good Governance Series #2

The Dangers of Fishing in Shallow Pools

One of the many restrictions on the PMSA’s ‘Governance Review’ being conducted with the AICD, is the retention of the current PMSA Constitution. The Constitution can only be amended with the consent of the Churches. Amending the By-laws does not need Church consent – it can be done by a majority vote of the PMSA Council itself.

One of the many deficiencies of those documents is that the Councillor Qualification clause is not in the Constitution, but in the By-laws, which means it is at the behest of the PMSA Council alone. Another deficiency is the clause itself and, in particular, the requirements a person must satisfy in order to be appointed as a PMSA Councillor.

Clause 3.3 of the PMSA By-laws states:

3.3.1 Councillors must:

(a) be a member of either the Presbyterian or the Uniting Church; and

(b) display community leadership; and

(c) be able to apply sufficient time and effort as to achieve the objectives of the Association; and

(d) from appropriate experience in committees/associations/boards have an understanding of successful corporate governance practices; and

(e) have a preparedness to publicly identify with or champion independent Christian-based schools and the Association’s schools.

……..

3.3.3. In addition Council on the advice of the Appointment and Remuneration Committee may determine other criteria, skills, knowledge and experience to qualify a candidate as Councillor.

Much could be said about the inadequacy of those requirements for the people with ultimate responsibility of operating a large, complex educational undertaking with 2000 staff and volunteers, 5000 children, an income of $120,000,000 per annum and assets of over $500,000,000.

However, one in particular caught my attention - no-one, other than members of the Presbyterian and Uniting Churches, is allowed to be a PMSA Councillor. Now, I would have thought that that’s a pretty limited candidate pool, wouldn’t you?

Just how shallow is the pool?

About as shallow as you can get.

According to the 2016 Census, 2.3% of Australians identified as Presbyterian, although not all will be members of the church. The Presbyterian Church states it has approximately 54,000 members – only 11 times the number of students in the four (4) PMSA schools and a mere 0.22% of the total Australian population. The pool of potential candidates will be even tinier again, given that, for practical purposes, the person will need to be a member of a Presbyterian Church in south-east Queensland where all four (4) schools are located.

3.7% of Australians, or 870,000, identified as being members of the Uniting Church in the 2016 Census. The Uniting Church’s own census in 2013 indicates that its Queensland synod membership is between 16% and 21% of the national membership. That is, between 139,000 and 182,000 – only 0.57% to 0.75% of the total Australian population, without further reductions to take into account the south-east Queensland location.

It should be noted the pool is not enhanced or expanded by the community members of each of the School Councils. This is because School Councils are merely sub-committees of the PMSA Council and do not have decision-making powers. Only the PMSA Council, and therefore the PMSA Councillors as a group, has decision-making powers in accordance with the PMSA’s governing rules.

So, at very best, the pool of candidates from which PMSA Councillors must be drawn is less than 1% of the Australian population and excludes more than 99% of Australians from being PMSA Councillors. Less than 1% are considered suitable and more than 99% are considered unsuitable?

What problems does a shallow pool bring?

Like me, I’m sure that you don’t need a HR practitioner to tell you that when it comes to recruiting, bigger is definitely better. The bigger the pool, the more likely the person will be the right fit, will perform, and will stay. This is because a larger pool invariably leads to having multiple desirable candidates of a similar calibre. It allows a more robust process including comparisons, ratings, second interviews and informed debate, leading to a much higher quality decision.

Shallow pools are a common indicator of non-strategic thinking and processes, and greatly decrease the chances of finding a person who has the necessary qualities, characteristics, skills, knowledge and experience to fulfill such an important role as a director or, in this case, a PMSA Councillor, particularly in an educational business of such importance, size and complexity.

The incredibly shallow candidate pool must adversely affect the calibre of candidates, and have a negative impact on the level of skills, knowledge & experience available to make decisions.

But, it also has a negative impact on board dynamics and function, which are crucial to good governance and good decision-making. The importance of this issue cannot be understated. And, it is of sufficient importance to the existence (or not) of good governance that it was highlighted by the AICD in its publication “Good Governance Principles & Guidance for Not-for-profit Organisations”.

The ‘Group Think’ phenomenon

In the ‘Good Governance Series #1’ blog, I noted that implementation of the AICD’s Good Governance Principle 2 – Board Composition – was less likely to result in ‘group think’.

So, what is ‘group think’. And what’s the relationship with fishing in shallow pools?

‘Group think’ occurs within a group where the desire for conformity or harmony results in irrational and dysfunctional decisions and outcomes. It involves, on the one hand, a group (‘ingroup’) that significantly overrates its abilities, and on the other, it significantly underrated the abilities of the ‘outgroup’. What it produces is ‘dehumanising actions’ by the ‘ingroup’ against the ‘outgroup’. Sound familiar? Keep reading.

Symptoms of ‘Group Think’

The symptoms of ‘group think’ and their indicators have been divided by the experts into three (3) main types:

Causes of ‘Group Think’

Experts have identified three (3) primary causes of ‘group think’. They advise that the existence of all three (3) is possible, but not necessary; and although high group cohesiveness is the main competent, it is likely that ‘group think’ will be avoided where dissent and alternative strategies are encouraged.

It all sounds very, very familiar, doesn’t it?

Unfortunately, this is just one of the many factors of the PMSA’s governance arrangements that have led it, and us, to where we are now.

It needs to end. But, it will not end with a few changes to a very small portion of the PMSA’s governance. It will not end without changing the PMSA’s Constitution and By-laws.

Only sweeping, fundamental, top-to-bottom reform will bring it to an end. And that lays squarely at the feet of the PMSA and the Churches.