Going beyond governance

Governance is one of those weird words that you hear a lot more in the non-profit world than you do outside it.

It’s only very recently that I’ve started to understand what people mean when they use it.

For a long time, my assumption was that “governance” meant “issues relating to the board”.

While not every for-profit organisation has a board, most non-profits do. That’s because non-profits exist to use their resources for the public good, and so they require some kind of oversight to make sure that happens. Hence: a board.

Now, in any organisation that has a board, a certain amount of leadership time is taken up with board relations.¹ You have only a very limited amount of time with your board members, so you have to prepare thoroughly. It takes careful risk assessment to make sure you are telling them everything that they need to know, in the right level of detail.² And similarly, board members themselves have to risk assess the information that they’re asking for. They have to be confident that decisions they make are being acted on. They also have to form an effective team with their board colleagues.

This is all important stuff. Charities and other types of non-profit are naturally very concerned with governance, because that’s how they manage their adherence to public benefit, which is central to their existence

Getting this flow of information and decision-making right is an art. That’s what I’ve always thought of as ‘governance’. And it is.

But I think there is a way the word is used (in the UK, at least) that is bigger than this.

I googled “what is charity governance” and got this response:

Charity governance refers to the systems, processes, and leadership ensuring a charity is directed effectively, manages resources well, complies with the law, and remains accountable to the public to achieve its charitable goals. Led by a board of trustees, it involves setting strategy, overseeing operations, managing risks, ensuring financial health, and maintaining transparency and integrity, ultimately building public trust and delivering lasting impact.

That first sentence is exactly the stuff I wrote about above. But something else is going on in that second sentence. Risk management, financial health, operations, strategy setting... Those are certainly issues that the board needs to be informed about, but are they part of governance?

I think there is a thought process that goes something like this:

1. The board makes certain key decisions

2. These decision are often captured in policies³

3. All policies are therefore part of governance

I mean “policies” in the widest sense of the word, meaning “anything formal-ish that the organisation writes down”. And, using that definition, it’s that third step where I think a significant problem occurs, because governance effectively takes over all the space where operations would sit.

Ops people are concerned with making it easier for an organisation to do things in a reliable and repeatable way. Writing things down is part of that.

Things that are written down - including work processes, job descriptions, contracts etc - do serve a function of managing risk. But they can do so much more. They can help drive learning and continuous improvement. They can a way to create resilience, by codifying knowledge so things rely less on specific individuals. They can create clarity and reduce friction.

These things can have a bigger impact when looked at through an ops lens, than when they are just seen as part of governance.

What I think I’m seeing is that the traditional focus on governance seems to starve operations of oxygen. Most non-profits are small. ‘Small’ is the standard size for charities in the UK. And small organisations only have so much energy and attention to go round. Small organisations are left without the space to think about ‘improving the way the organisation works’. And because of that, they are not as effective as they could be. They could be having more impact with their limited resources.

So this is my rallying cry. Charities of the UK - operations is here for you. We want to help you have more impact, but first you have to make space for us. Please include us in your view of what organisations need to succeed!

Or have I got it wrong? Have I just been seeing a lot of people talking about ‘governance’ recently and jumped to conclusions? Is operations just hidden ‘under the bonnet’ and not something people focus on publicly? Is this a problem for all small organisations and not a non-profit issue? Comments are open…

1. When I did the Operations Nation course for COOs, we had a whole module on this.

2. Remembering always how much harder it is to write everything you one to say in one very precise page, than in ten rambling pages.

3. This is another chance to quote a colleague in the sector: “I’d never heard the word ‘policy’ so many times until I joined an NGO.”