Board Governance Watching Brief Codes of Conduct and managing conﬂicts of interest are the daily responsibilities of our health boards. Without good governance, public trust is at risk. When Medical Forum embarked on this select survey of governing boards of WA charities, NGOs and mutuals operating in health, it became clear just how different the organisations were from each other. Some are member owned, others are overseeing billion-dollar businesses, while others are community-based organisations. While impossible to compare apples with oranges, it is useful to explore how the boards govern and what safeguards are in place in areas such as transparency, remuneration and conﬂict of interest. The Healthway controversy is a timely reminder of the important role public perception and trust plays in the performance of our health boards, particularly for those organisations that invest taxpayer or donor money for the welfare of the community in which they serve. The Public Service Commission’s website is a font of information regarding standards and its guidelines on remuneration of boards and governance issues such as conﬂicts of interest are benchmarks. In the limited time available, we approached eight organisations representing communitybased, not-for-proﬁt, mutual and industry bodies: St John of God Health Care (SJGHC), Cancer Council WA (CCWA), Heart Foundation WA, MDA National, ConnectGroups, Bethesda Hospital, Lotterywest and AGPAL, all but AGPAL responded at least in part to our questions.
recorded in a register and the member is absent during all discussion on related matters. The board regularly evaluates its own performance and individuals are “carefully selected and evaluated on the basis of their performance.” Lotterywest
Is a State government authority reporting to the Premier, Mr Colin Barnett. It collects $797m in lottery revenue (7% to operating costs; 8% commissions to the 500 retail outlets; $271m community grants, remainder to winners). In his public comments during the Healthway controversy, Mr Barnett used Lotterywest as the model he prefers. It has a six-member Board of Commissioners appointed by the Cabinet on recommendations from the Premier for threeyear terms. Board members are remunerated under the matrices of the PSC. Declarations of events attended or beneﬁts received are made at each board meeting and recorded in the minutes. Conﬂicts of interest are dealt with as per PSC guidelines. The Minister (Premier) reviews all board positions and performances and he invites individuals to the board who possess the “appropriate skills”. “Good standing in business and the community is important.”
Is a religious-based NFP managing a national hospital and healthcare operation with an operating revenue of over $1b in the last ﬁnancial year. Its trustees select board members on the basis of “skills and experience from different backgrounds” – a detailed board proﬁle is available on its website. Members are from medical, business, legal and consumer backgrounds. Tenure is usually three years though it is at the trustees’ discretion. There is no maximum time limit. Board members are remunerated but no ﬁgure was provided to Medical Forum. A full ﬁnancial statement is online at the Australian Charities and Not-forProﬁt website (acnc.gov.au) where SJGHC says it discloses transactions of a related party nature. Conﬂicts of interest is the ﬁrst agenda item of every board meeting, such conﬂicts are
Is a member-owned mutual providing professional indemnity and supporting services for the medical profession. It has two arms – MDAN Ltd and MDAN Insurance Pty Ltd and is led by two boards – the mutual board and the insurance board. The mutual board currently has nine member-elected directors and one appointed director. Elections are conducted as per its Constitution and tenure is for three years. Voters must be members and be registered or retired medical practitioners. The majority of insurance board members including the chairman are independent. All of its directors are appointed by the mutual board. They must meet the Australian Prudential Regulation Authority requirements for a licenced general insurer. Members of both boards are remunerated at “commercially competitive”
Each was asked (abbreviated here): så (OWåITSåBOARDåISåSELECTEDåANDåTENUREåOFå members? så !REåBOARDåMEMBERSåREMUNERATED så (OWåBENElTSåANDåCONmICTSåOFåINTERESTåAREå addressed? så 4RANSPARENCY så 0ERFORMANCEåREVIEWåOFåBOARDåMEMBERSåIFå controversy arises?
rates “reﬂecting the contributions required”. Each board assesses the boards’ and individual directors’ performances against the constitution. Elected directors who remain eligible under the Constitution and the Corporations Act and their Board charters can only be removed by a resolution of the members of MDAN. Conﬂicts of interest must be declared at board meetings and that member may be required by the remaining directors to absent themselves from relevant parts of the meeting. Cancer Council WA Is a non-government agency with a charter to provide support and services to cancer patients and their families, fund cancer research and run cancer education and prevention programs. Funding is through community fund-raising, donation, sponsorship, income from retails outlets and government grants. It has 11 board members who are not remunerated. Board membership is by recommendation from CCWA’s Nominations and Membership Committee based on skills and experience to complement the board. If the board accepts a recommendation, that person is appointed for 12 months with a review at the end of that period. Each board member must formally agree to abide by the Code of Conduct which includes well-deﬁned conﬂict-of-interest guidelines and deﬁnitions, and precludes any member from “seeking or accepting any fee, favour, reward, gratuity or remuneration of any kind.” In addition a member must not use conﬁdential information obtained during a board meeting for personal advantage. Donors and supporters are able to request a copy of the Code of Conduct. Conﬂicts of interest are a standing item on the agenda and board members must disqualify themselves from any relevant discussion or decision. Performance evaluation occurs if need arises and action is based on the Code of Conduct. Public trust is crucial and strict observance of governance practices and procedures is paramount. continued on Page 10 MEDICAL FORUM
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