Welcome to our fourth edition of Perspectives. In this issue, we explore the often-debated theme of FE Board remuneration, and we ask Gillian Norton, Chair of two NHS Trusts, to share her experience of the impact pay has on NHS boards, in particular on motivation to become a NED, accountability and affordability.
In this climate of uncertainty and the operational challenges that most Colleges face in adapting to a new way of working, on the surface Board remuneration may not be top of the list in terms of investment priorities. Balanced with this view, however, is the unprecedented responsibility that board’s face in terms of organisational performance and governance. The soon to be released White Paper will undoubtedly discuss governance of colleges, and the recent ‘College of the Future’ report certainly highlighted the role of the board, including “leadership and governance reflects the community the college serves and is highly skilled to provide system leadership.”
As Executive teams across the sector wrestle with significant strategic challenges, the board needs appropriate opportunity to input, scrutinise decisions and maintain effective stewardship of the College. A highly functioning board, with professional levels of support made up of the right constituent members with a diverse skillset, background and inclusive, will be essential to navigate the choppy waters ahead.
Of course, payment of board members is not the ‘silver bullet’ to resolve these issues. The debate on remuneration has continued for well over a decade but is gaining increased traction. The DfE, along with the ETF, is supporting the professionalisation of governance in FE and the outgoing FE Commissioner has also thrown his weight behind remuneration of Chairs. Further discussions have taken place within the AoC though many arguments remain the same:
- Remuneration leads to people applying for financial reward
- Remuneration could negatively affect the relationship between the remunerated Chair and the unremunerated board member
- Colleges can’t afford it and money should be spent on learners
- Where is the evidence to support the claim that it will lead to a higher calibre of board members and therefore decision making?
Counter-arguments are also put forward;
- The money, for senior and experienced leaders is relatively minor and not a motivating factor.
- The increasing time, accountability and responsibility means it requires greater effort than in the past and should be recognised.
- It becomes a different psychological contract. It supports those who are still in full-time roles, not only with their precious time but also from the perspective of their employer who more readily recognises and appreciates remunerated board positions.
- Individuals now look towards developing a portfolio career and can often only look at just one unremunerated role. In a highly competitive marketplace, remuneration increases the chance of reaching a more diverse pool of talent – who are often the most in demand.
- If Colleges are really serious about increasing board diversity remuneration can unlock a wealth of talent. A strong argument for remuneration is that is draws in candidates who might not otherwise be able to afford the time commitment, and therefore repeats the cycle of non-representative boards.
- Remuneration can increase attendance and commitment – it also allows a more performance management approach to governor performance and input.
- The cost to the College is also minimal. It should be value, not cost, that is looked at. There are many examples in education and in charities where money is directed solely to the frontline and not enough is spent on governance and leadership of the organisation, resulting in organisational failure, which is of far greater cost.
Paul Aristides Partner, Further Education and Skills
Read Gillian Norton's perspective, Chair St George’s University Hospitals NHS Trust and Chair of Espsom and St Helier University Hospitals NHS Trust