Board Effectiveness (principle three)

The essential functions of the Board are to: 

• Define and ensure compliance with the culture, values, vision, mission, and strategic objectives of the organisation ensuring its long-term success.
• Ensure that the organisation operates effectively, efficiently, and economically
• Establish a framework for approving and maintaining oversight of strategies, policies and plans to achieve those objectives.
• Satisfy itself as to the integrity of financial information and approve each year’s accounts, budget, and business plan prior to publication.
• Establish and oversee a framework of delegation and systems of internal control which are reviewed annually.
• Establish and oversee a framework for the identification, management and reporting of risk in order to safeguard the assets and reputation of the Group.
• Agree or ratify policies and decisions on all matters that might create significant financial or other risk to the organisation, or which raise material issues of principle.
• Monitor the organisation’s performance in relation to these plans, budgets, controls, and decisions and also in the light of customer feedback and the performance of comparable organisations.
• Develop positive and constructive relationships with stakeholders, including residents, funders, and regulators.
• Establish and monitor a mechanism for communicating and receiving feedback from the group’s stakeholders, and reporting on the feedback received, demonstrating accountability and transparency.
• Establish a strong working relationship between the Board, Chief Executive, Leadership Team, and other employees, providing oversight, strategic guidance and constructive challenge to the Chief Executive and Executive Directors.
• Appoint (and, if necessary, dismiss) the Chief Executive and approve his or her salary, benefits, and terms of employment.
• Satisfy itself that the organisation’s affairs are conducted lawfully and in accordance with generally accepted standards of performance and probity, good practice, and regulatory requirements.
• Satisfy itself that the needs and safety of the organisation’s current and future residents and other customers are placed at the heart of its decision-making.
• Assess how the Group follows the recommendations of the NHF Code and confirm compliance or explain any areas of non-compliance in its annual review and accounts.
• Follow the organisation’s constitution in appointing (and, if necessary, removing) the Chair and Deputy Chair of the Board.
• Confirm and maintain the high standards of conduct and behaviour expected of members of the Board.
• Protection of the assets of the organisation
• Hold subsidiary boards accountable for the delivery of their objectives.

In order to ensure the Board discharges its duties a Board Meeting Planner and Timetable is in place.  Decisions which are reserved for the Board  

The role of Board Members is collaborative, collectively working to effectively fulfil the Board’s functions.

Each Board Member is bound by a formal contract specifying obligations, signed to indicate acceptance. The contracts outline key elements of the role and duties, time commitments, and the principle that approved remuneration is linked to fulfilling specified responsibilities. Additionally, the contract and role of a Board Member encompass obligations to: 

• Uphold the values and objectives of the organisation. 
• Adhere to the organisation’s core policies, including the code of conduct, standing orders, financial regulations, and equality and diversity. 
• Understand the constitution and legislative framework applicable to the Group and act within its powers. 
• Contribute to setting the strategic direction of Housing 21, bringing knowledge and expertise to Board discussions, and demonstrating an understanding of Housing 21’s functions and the wider regulatory and political environment. 
• Ensure that issues are explored from a range of viewpoints. 
• Contribute to and share responsibility for the Board’s decisions, including the duty to exercise reasonable care, skill, and independent judgment. 
• Prepare for and attend meetings, training sessions, and other events. 
• Attend and participate in reviews linked to individual performance or of the whole Board. 
• Represent the organisation as appropriate. 
• Declare any relevant interests and avoid conflicts of interest. 
• Respect the confidentiality of information. 
• Uphold the principles of good governance as set out in the NHF Code and this Handbook. 

Board Members must allocate sufficient time to meet the requirements of the role. They work with and through the Board, without the obligation to undertake any executive duties or assume executive responsibilities. Board Members are encouraged and welcome to sit on Committees of the Board, subject to possessing the requisite skills and knowledge required. 

The Board has decided to remunerate its members and possesses the necessary authority to implement such payments. The details of payments made will be disclosed annually in the organisation's financial statements. 

Payment levels will be reflective of the roles served by members, with a pay differential to acknowledge the role of the Chair of the Board. All other Board Member roles are considered equal, whether serving as a Chair of a Committee or holding a specialist lead role. 

The Governance, Transformation, and Treasury Committee conduct an annual review of payments. Additionally, every three years, external validation is sought to ensure that the payments made are proportionate to the role and complexity of the organisation. This review takes into account good practices, market comparisons, and industry norms, with a commitment to paying at the median market level. 

The Chair of the Board is responsible for providing strong leadership for the Board, ensuring the Board works effectively. The Chair also has an important role in acting as an ambassador for Housing 21 with external stakeholders.   

The rules set out the process for electing and removing the Chair of the Board. 

The Chair is normally appointed for up to six years (longer with the agreement of the Board but for no more than nine years) and this is ratified annually at the first Board meeting after the AGM. 

The Board Chair whilst an ex-officio member of all Committees and Subsidiaries will not be a voting member of the Committees and will not Chair of the Audit and Assurance Committee or Governance, Transformation and Treasury Committee. 

The Chair and the Deputy Chair will work closely so there is effective leadership of the Board. The Deputy Chair will deputise for the Chair in their absence.   

The Chair of each committee fulfils an important leadership role similar to that of the Chair of the Board, particularly in relation to creating conditions for overall committee effectiveness.  

Committee chairs shall be appointed by the Board on an annual basis from amongst the existing members of the Board.  

The role of each committee is outlined within the related terms of reference at Appendix 8. The Terms of Reference for each committee will be reviewed annually while reviewing committee effectiveness. 

The Company Secretary role supports the Chair in helping the Board and is committees to function effectively.  

Appointment of an individual to the Company Secretary role requires approval by the Board. 

The Board is typically comprised of nine to 11 members selected and elected based on the collective skills and attributes required for effective governance. Board elections take place annually at the Housing 21 Annual General Meeting, with the rules of Housing 21 outlining requirements for: 

• Election of Board Members 
• Quorum for Board meetings 
• General powers 
• Powers to establish committees. 

A quorum, consisting of five Board Members, is required for Board meetings. However, the Board may, if deemed necessary, determine a higher number or impose additional requirements. Decisions are made by a simple majority, with an emphasis on achieving consensus whenever possible. In cases where a vote is tied, the Chair has the casting vote. 

Board decisions are typically made and recorded during face-to-face or virtual Board meetings. In exceptional and urgent situations when physical meetings are not possible, decisions may be taken by email. 

To fulfil its duties, the Board convenes a minimum of six times per year, with at least one meeting designated as a confidential away day focusing on strategic issues. Housing 21 has established a Scheme of Delegation Framework, outlining how the Board, Committees, and Executive collaborate to fulfil Housing 21's functions. Additionally, specific matters or decisions may be delegated to individual Board Members or committees as deemed fit by the Board. 

The roles of the Chair of the Board and standing Committees (and those of the Deputy Chair) are not held by an Executive. Further details are available in Appendix 7 - Conduct of the Board’s Business. 

Board – Review and Specification 

The Board establishes an open and transparent procedure based on merit, clear objective selection criteria, and assessment techniques for Board and committee recruitment and selection. Within this framework, it promotes diversity of gender, social, economic, and ethnic backgrounds, as well as cognitive and personal strengths. 

Provisions are made to consider individuals with direct lived experience or insight into the communities served by Housing 21 during recruitment and selection for the Board and committee positions. Periodic reviews of the Board's composition and membership are conducted to identify gaps or imbalances in diversity, skills, and experience. The appointment of new members may be considered to address any identified gaps. 

The Board and its committees ensure their continuing effectiveness by conducting an annual performance review, which includes an assessment of composition, diversity, and how effectively members collaborate to achieve objectives. The review also addresses any identified areas for improvement. 

The Board Chair, in conjunction with the Governance, Transformation, and Treasury Committee and the Chief Executive, determines the most appropriate method for publicising vacancies to the relevant community members. Methods may include national advertisements, contact with national bodies or agencies, or personal recommendations. 

Prospective Board Members receive comprehensive information about Housing 21, its committees, subsidiaries, and the roles of Board Members. The Board Chair, along with selected Board Members and the Chief Executive, manages the selection process, creating a shortlist of preferred applicants, matching skills against the Board Member specification, and conducting interviews. 

The selection group recommends the most suitable candidate(s) to the Board at the next available meeting for formal appointment to Board membership. Once agreed, the Company Secretary ensures the new Board Member signs a contract, receives relevant governance literature, and undergoes an induction programme. Ongoing learning and development opportunities are provided during the Board Member's tenure. 

Up to two places on the Board are reserved for tenant Board Members, and nominations are sought through newsletters and other engagement forums. The selection process is the same for other Board Members, except an existing tenant Board Member may also be invited to be on the selection panel for a new tenant Board Member. 

The maximum tenure is typically up to six consecutive Annual General Meetings (AGMs), comprising two terms of office. However, if the Board deems it in the organisation's best interests, a member's tenure may be extended. No fixed term is set to cause a board member to serve beyond their ninth consecutive AGM. A member who has left the Board will not be reappointed for at least three years. 

The Board Chair may be appointed from within the Board.  

The Governance, Transformation and Treasury Committee is responsible for overseeing the selection and appointment process in respect of the Board Chair. 

The Chair of the Governance, Transformation and Treasury Committee with the support of the Chief Executive, will manage the process in accordance with guidelines set by the Governance, Treasury and Transformation Committee, including:  

• Drawing up a specification of desired skills/ expertise. 
• Determining the most appropriate method of bringing the vacancy to the attention of prospective candidates. 
• Carrying out short listing and the arranging of interviews. 
• Conducting interviews together with other Board Members. 
• Making a recommendation to the Board regarding appointments; and 
• Overseeing the necessary procedural steps to formalise the appointment once the Board has approved this. 

The induction programme provides new members with information and support to be confident and productive in their role. The process helps new members to understand the organisation, the environment in which it operates, and their role in making the organisation a success. 

A tailored approach to induction will be put in place with some mandatory aspects also included. A standard set of corporate documents will be provided along with access to relevant policies. Further insights into the organisation are gained through visiting Schemes and connecting with both Executive Directors and officers.  

As part of the induction process a buddy arrangement will also be established. 

The Governance, Transformation, and Treasury Committee ensure plans are in place for orderly succession in appointments to the board, Chairs of Committees, Executive Team, and Subsidiary boards. They oversee the development of a diverse pipeline of succession. 

The Chair of the Board, with the support of the Company Secretary, helps the Governance, Transformation, and Treasury Committee review the skills required, identify gaps, develop transparent appointment criteria, and inform succession planning. 

A skills audit review, based on an assessment of individual and collective skills of members against current and future requirements, is undertaken, generally annually. Flexibility is needed so these can inform recruitment campaigns for new Board and committee members. 

The Governance, Transformation, and Treasury Committee, annually, assess whether the desired outcome has been achieved and propose changes to the Chair of the Board, as necessary. 

Succession plans will consider: 

• Contingency planning: For sudden and unforeseen departures. 
• Medium-term planning: The orderly replacement of current Board Members and Executives. 
• Long-term planning: The relationship between the delivery of company strategy and objectives to the skills needed on the Board now and in the future. 

Problems and misunderstandings may occasionally arise between Board Members, who are encouraged to resolve them quickly and informally through discussions. However, where this is not possible the Board grievance policy should be followed to seek to achieve a resolution. 

Where Board Members wish to report a concern, risk or wrongdoing which adversely affects Housing 21 service users, residents, customers, the public, other employees, or the organisation itself please refer to the Whistleblowing Policy and Procedure. 

The Board has a process for removal of Board Members where issues of performance, conduct and conflicts arise that cannot be resolved. This is overseen by the Governance, Transformation and Treasury Committee. Further details are provided within the Rules. 

Housing 21 has an open membership policy but will only appoint new members who are not Board Members if they have a particular association or interest in the long-term success of the organisation.   Housing 21 will remove existing members who are no longer actively engaged with the organisation in accordance with the provisions in the Rules. 

Board Members will be asked to become members of Housing 21, but membership will automatically lapse when the person ceases to be a Member of the Board, albeit there will be an opportunity to apply to become a permanent shareholding member at that point.