At YWCA, we recognise that one of the areas where young women and gender diverse people encounter obstacles to achieving impact and empowerment in is governance. How many articles are there about organisations that have a board that is 100% populated by white men over the age of 45? Or that there were more men named John (or Andrew, or Peter, or David) who are the CEOs or Chairs of big companies than there are women? And don’t even get us started on the lack of representation of gender diverse people, LGBTIQA+, people with disabilities or people of colour at Board-level!
You can’t ‘girlboss’ your way out of systemic barriers or change a system when it’s not designed to be easily understood. Despite being important, governance is often way too technical, theoretical and inscrutable. Rather than take our word for how important governance is (and it IS, trust us) we’re aiming to make the inscrutable very scrutable and even the playing field for the Janes, Jamilas and Jessies and diversify the voices leading change at the top.
So, what is governance?
There are a few ways that we can describe governance:
- Governance is the system by which a company or organisation is directed and managed. It includes structures and processes that are designed to ensure transparency and consistency of decision making. In turn these lead to accountability, equity and inclusiveness.
- Governance includes ethics, risk management, compliance and administration – all the parts together result in a system within which the company or organisation is controlled and operated.
- Governance helps you to act in the best interests of your organisation. It ensures stability and reduces risks, can lead to faster and safer growth, an improved reputation and ability to foster trust amongst stakeholders.
Put very simply, governance is everywhere in any organisation you encounter when you’re an employee, Board member, or volunteer. But it’s not until things go really wrong that you’d ever really notice it or how important it is.
Can you give me an example?
Think of a school council. There is a process around how council members are selected and this process is shared beforehand – so it is open and transparent. The process should be fair (no one is secretly tapped on the shoulder and asked to join), so there is a level playing field for everyone and equity of opportunity. Everyone understands the rules of applying, and how the selection process will take place.
Once on the council, there is likely to be a calendar of activities that happen throughout the year – this helps the council plan their time and understand when decisions need to be made. There is also a delegation of authority: The school council know what they can make decisions on, how much authority they have and, most importantly, the limits of their authority. For example, the Council might make the decision about how they can raise money for their school at school, but they may not have the authority to plan a fundraiser outside of school grounds, or they might need the approval of someone who works for the school (like the principal) before it can go ahead. This delegation of authority is an important piece of the governance structure.
Processes, policies, procedures, practices… These are aspects of governance that set out how things should be done. They might not be glamorous or exciting, but they are extremely important. The school council will have an agreed election process so that every year the nomination, candidate selection and vote processes are consistent. In some organisations these processes exist only in people’s heads or memories, so it’s important that these are recorded and that others have access to them – in this way the process is transparent and accessible.
For example, the school council might have a policy on fundraising. This could be that students are never asked to give more than a gold coin. When recording this policy, the Council might give the reasons behind this (it’s not fair to expect students to give more than they can afford) and there might be an accompanying procedure (who collects the money, when do they collect it, and how is it stored). In this way, students know what to expect and who to give the money to. This fosters trust in the Council and the way it operates, so everyone is comfortable with what’s being done and how it’s being done.
I think I’ve got it! It comes down to rules, processes and good leadership, right?
Exactly. And when good governance goes bad, the consequences can be pretty dire – we’re talking bad news coverage and court appearances dire. For example, have a look at what happened with Crown Resorts. They operate Crown Casino, which is one of the largest employers in Victoria, but a series of investigations and reports found that they had been involved in unethical and illegal activity like money laundering and suspicious ties to organised crime. They were denied a licence in NSW and almost had their Victorian licence revoked.
What’s important here is to note the role of the Board and the management team in all of this. There was never any doubt who was at fault, because these were the people responsible for having oversight of what Crown was doing and making sure that everything was ethical, legal and operating according to the many, many regulations it was supposed to follow. The Crown is the perfect example of ‘what not to do’ for good governance.
Governance IS important! How can I get involved?
Now that you have an understanding of what governance is and why it’s important, it’s time to think about how you can get involved in it. When so many organisations are populated by the same voices (like the Johns, Andrews and Peters of the world), it’s hard to see change for good.
The biggest hurdle is getting young people and people of diverse genders, life experiences and backgrounds into positions where they can diversify the voices heard and lead to systemic change. Your knowledge is a weapon, now you just need to find the opportunity to use it.
