June of this year saw the official launch of the Governance Code which provides for the first time, clear guidelines on the roles, duties and responsibilities of those who run community, voluntary or charitable organisations. In the absence of regulatory legislation, this is certainly a milestone for the sector.
Boardmatch caught up with the CEO and Company Secretary of Clúid, one of the largest housing associations in the country to hear their experiences on implementing the Code.
1. Boardmatch Ireland: Why did you decide to implement the Governance Code?
Brian O’Gorman (CEO): The Code came as somewhat of god send for us so we really grabbed hold of it with both hands. It covers all bases in terms of good governance practice and so for us, ticked all the right boxes.
I think the structure of the Code is one of its main strengths. Firstly; the principles-based method whereby organisations are given a framework of 5 main principles of compliance makes the Code very comprehensive and user-friendly. In addition, the Code has been developed into three versions, mirroring three main organisational types within the sector. In my mind, this is one of the major triumphs of the Working Group because an organisation like Clúid with complex governance structures and over 100 staff will have different requirements to a small organisation run on a purely voluntary basis.
Lorraine Nolan (Company Secretary): As I am in charge of administering and overseeing the implementation of the Code in Clúid, I have found that one really useful aspect is the Checklist function. Implementing the Code may seem like a mammoth task and you might not know where to start. I’ve found that the checklist has really helped me keep track of where I am in terms of progress.
2. BMI: Did you come across many challenges when trying to implement it?
Lorraine: Naturally, we found the implementation of the Code a bit challenging in the beginning because it was new so we had to adjust and manoeuvre accordingly. But in actually fact, the Code highlighted that Clúid had quite robust governance structures already in place which had not been formally recognised. The Code in this sense provided a mechanism for recording what we were already doing and other organisations may find that this is also the case.
What I would say is that you need a designated person like a compliance officer or equivalent, who will manage and oversee the implementation of the Code otherwise you risk making things quite complicated.
As an aside, I think the most important lesson I have learnt is that you can’t lose sight of your core business. Whilst it is essential for every organisation to have a strong governance structure in place, devoting too much time at the cost of your core business isn’t good for the organisation.
3. BMI: One of the reasons why organisations opt against the Code is the notion that it will increase an already full workload. Did you find this was the case?
Brian: Implementing the Code definitely takes work but the results have been overwhelmingly positive. For Cluid, it is of the upmost importance that we are seen to be upholding good governance structures for our external stakeholders. So yes, it was work but it brought us closer to one of our key objectives and this is certainly worth putting time into.
4. BMI: Do you think the Code and other such codes of practice can act as effective replacements for regulatory legislation as indicated by Minister Hogan?
Brian: The not-for-profit sector needs regulatory legislation like the Charities Act 2009. However, I also feel that the Code is designed in such a way that it could easily be adopted as statutory legislation a few years down the line when it has garnered sufficient acceptance within the sector. Whilst the Code in its present form is very valuable to the sector, it is still voluntary and this presents obvious problems in terms of the level of up-take.
5. Minister Hogan recently released a draft Code of Governance for the housing association and co-operatives. Do you think the sector needs specific Codes of Practice?
Brian: The principles of governance remain the same whether you are a housing association, a sports organisation or over-seas development charity, so I feel that the Governance Code is equally relevant for all organisations in the sector. A plethora of Codes will only dilute their effectiveness.
6. Finally, if you had one piece of advice for organisations looking to implement the Code or currently in the process of implementing the Code, what would it be?
Lorraine & Brian: Just do it. Don’t be put off by starting, it takes work but the end result is certainly worth it. Good governance makes for a more a more transparent, efficiently run organisation and this is hugely beneficial for both the organisation itself and its external stakeholders.We think real questions are raised about an organisation if they do not make steps towards implementing the Code.