Policy Governance Model: A Comprehensive Guide

Policy Governance is an integrated board leadership paradigm created by Dr. John Carver, which is designed to empower boards of directors to fulfill their obligation of accountability for the organizations they govern. The Policy Governance Model is a generic system that is applicable to the governing body of any organization, regardless of its size or sector. The Carver Model, as it is informally known, defines and guides appropriate relationships between an organization's owners, board of directors, and chief executive.

The Policy Governance Model is a radical redesign of Board leadership that makes new sense of the Board-staff relationship, planning, evaluation, and all other aspects of the Board job. It is a conceptually coherent model, intended as a complete replacement of the deeply flawed traditional wisdom about Boards. Policy Governance is a system for organizational governance that defines and guides appropriate relationships between an organization's owners, board of directors, and chief executive. It is a framework that allows boards to focus on the larger issues, delegate authority, and manage their own performance.

John Carver is the creator of the Policy Governance Model and is the best-selling author of Boards That Make a Difference. He is co-editor (with his wife, Miriam Carver) of the bimonthly periodical Board Leadership. John Carver has written over 180 articles published in nine countries and is an author or co-author of several books on governance. The Policy Governance Model has been adopted by thousands of organizations worldwide, including non-profit organizations, public and private corporations, and government agencies.

Foundations of Policy Governance

Conceptual Overview

The Policy Governance model is a system of governance designed to provide a framework for boards of directors to fulfill their accountability obligations to the organizations they govern. The model was created by Dr. John Carver, and is based on a set of principles that provide a conceptual overview of the system. The principles include a clear definition of the roles and responsibilities of the board and the CEO, a focus on strategic leadership rather than management, and a commitment to transparency and accountability.

At the heart of the Policy Governance model is the concept of ownership, which is defined as the right to control the organization. The model recognizes that ownership can be divided among a number of different stakeholders, including shareholders, members, and the wider community. The model also recognizes that ownership can be exercised through a number of different channels, including voting rights, financial control, and the power to influence decision-making.

Historical Background

The Policy Governance model was first developed by John Carver in the 1970s, and has since been refined and expanded by a number of other authors and practitioners. The model is based on a theoretical framework that draws on a number of different disciplines, including organizational theory, management science, and political science.

The Policy Governance model is designed to be a generic system, which means that it can be applied to the governing bodies of any enterprise, regardless of its size, structure, or purpose. The model has been used successfully in a wide range of contexts, including corporations, non-profit organizations, and government agencies.

The Policy Governance model is based on a set of principles that provide a conceptual framework for boards of directors to fulfill their accountability obligations to the organizations they govern. The model recognizes the importance of ownership, and provides a clear definition of the roles and responsibilities of the board and the CEO. The model is designed to be a generic system, and has been used successfully in a wide range of contexts.

Roles and Responsibilities

Board Functions

In the Policy Governance model, the board of directors has a critical role in setting the direction and monitoring the performance of the organization. The board is responsible for defining the organization's mission, vision, and values. They must also establish policies that guide the organization's operations, including those related to finance, human resources, and risk management. The board should ensure that there is unity of purpose and one voice in the organization.

Board leadership is responsible for ensuring that the board functions effectively. This includes selecting board members, setting the agenda, and managing board meetings. Board leadership should also ensure that the board is adequately informed about the organization's performance and risks.

CEO and Staff Roles

The CEO is responsible for implementing the policies set by the board. They must ensure that the organization's operations are aligned with the mission, vision, and values set by the board. The CEO should also ensure that the organization's resources are used effectively and efficiently.

Staff members are responsible for carrying out the day-to-day operations of the organization. They must follow the policies set by the board and the CEO, and work towards achieving the organization's goals. Staff members should also be held accountable for their performance.

In the Policy Governance model, accountability is a critical aspect of the organization's operations. The board, CEO, and staff must be accountable for their roles and responsibilities. This includes being transparent about their actions and decisions, and being willing to accept feedback and make improvements.

Overall, the Policy Governance model provides a clear framework for defining roles and responsibilities within an organization. By establishing clear policies and procedures, and ensuring accountability at all levels, organizations can achieve their goals and fulfill their mission.

Policy Development and Execution

Ends Policies

Ends policies are the ultimate goals of the organization. They are the results that the organization wants to achieve for the community it serves. The board of directors is responsible for developing and implementing the ends policies. The policies should be clear, concise, and measurable. The board should also ensure that the policies are in line with the organization's mission, vision, and values.

To ensure that the ends policies are achieved, the board should regularly monitor the organization's performance. The board should receive regular reports on the organization's progress towards achieving the ends policies. The reports should include both quantitative and qualitative data. The board should also use the reports to make decisions and take action to ensure that the organization is on track to achieve the ends policies.

Executive Limitations

Executive limitations policies are the boundaries within which the CEO must operate. The policies define what the CEO cannot do, rather than what the CEO can do. The policies should be clear, concise, and measurable. The board of directors is responsible for developing and implementing the executive limitations policies.

The executive limitations policies should cover areas such as financial management, personnel management, and risk management. The policies should also cover areas such as communication, public relations, and community outreach. The board should regularly monitor the CEO's performance to ensure that the CEO is operating within the boundaries set by the executive limitations policies.

By clearly defining the ends policies and executive limitations policies, the board of directors can ensure that the organization is operating effectively and efficiently. The policies provide a framework for decision-making and delegation of authority. The policies also ensure that the organization is accountable to its stakeholders.

Monitoring and Evaluation

Monitoring and evaluation are critical components of the policy governance model. They help ensure that the organization is meeting its goals and objectives, and that the board is fulfilling its fiduciary responsibility.

Board Self-Evaluation

Board self-evaluation is an essential component of monitoring and evaluation. It helps the board assess its own performance and identify areas for improvement. The board should conduct a self-evaluation at least once a year. The evaluation should include an assessment of the board's performance in relation to its expectations, as well as its performance in relation to the organization's goals and objectives.

The board should use a standardized evaluation form to ensure that the evaluation is consistent and objective. The evaluation form should include questions that assess the board's performance in areas such as governance, strategy, financial management, and stakeholder engagement. The board should also consider using an external facilitator to help ensure that the evaluation is unbiased and objective.

CEO Performance Review

The CEO performance review is another critical component of monitoring and evaluation. The board should conduct a formal review of the CEO's performance at least once a year. The review should assess the CEO's performance in relation to the organization's goals and objectives, as well as the CEO's performance in relation to the board's expectations.

The review should use a standardized evaluation form to ensure that the evaluation is consistent and objective. The evaluation form should include questions that assess the CEO's performance in areas such as leadership, strategic planning, financial management, and stakeholder engagement. The board should also consider using an external facilitator to help ensure that the evaluation is unbiased and objective.

Overall, monitoring and evaluation are critical to the success of the policy governance model. They help ensure that the organization is meeting its goals and objectives, and that the board is fulfilling its fiduciary responsibility. By conducting regular board self-evaluations and CEO performance reviews, the board can help ensure that the organization is performing at its best and meeting the expectations of its stakeholders.

Governance in Different Contexts

Governance models are implemented in various contexts such as nonprofit organizations, corporate and public boards, school boards, and NGOs. The implementation of governance models in different contexts depends on the nature of the organization and the stakeholders involved.

Nonprofit Organizations

Nonprofit organizations are typically governed by a board of directors who are responsible for overseeing the organization's activities. The board of directors is responsible for setting policies, providing guidance, and ensuring that the organization is operating in accordance with its mission and values. In this context, the governance model is focused on ensuring that the organization is fulfilling its social mission and is accountable to its stakeholders.

Corporate and Public Boards

Corporate and public boards are responsible for setting policies, providing guidance, and overseeing the organization's activities. In the corporate context, the governance model is focused on ensuring that the organization is operating in accordance with its legal and financial obligations and is accountable to its shareholders. In the public context, the governance model is focused on ensuring that the organization is fulfilling its mandate and is accountable to the public.

In both contexts, the governance model is designed to ensure that the organization is operating in an ethical and transparent manner. The governance model includes mechanisms for oversight and accountability, such as regular reporting to stakeholders and the establishment of audit committees.

Overall, the governance model is an essential component of any organization's success. It ensures that the organization is operating in accordance with its mission and values and is accountable to its stakeholders.