Overview of Policy Governance ®

Policy Governance ® is:

A governance system that enables boards to focus on ownership (moral or legal), the future of the organization and its own governance processes, while empowering the CEO and his/her staff to manage the organization within pre-defined boundaries. The system strengthens the organization through board adoption of a comprehensive set of policies and protects the organization through board monitoring of policy compliance.

Policy Governance ® is not*:

A specific board structure. It does not dictate board size, specific officers (including CEO). While it gives rise to principles for committees, it does not prohibit committees nor require specific committees.
A set of individual “best practices” or tips for piecemeal improvement.
A dictation of what a board should do or say about group dynamics, methods of needs assessment, basic problem solving, fund raising, and managing change.
A limitation of human interaction or a stifling of collective or individual thinking.

Ten Principles of Policy Governance ® :

(Adapted from Dr. John Carver)

(1) The trust in trusteeship: Because board members act as trustees on behalf of a larger group, the “moral ownership,” and because the board is a subset of that group, the board MUST do the following: (1) clearly identify who that larger group is, (2) states what the larger group wants, and (3) make certain that the organization achieves what that group wants.

(2) The board speaks with one voice or not at all: Although unanimity is not required, the board's group decision must be unambiguous, recorded in policy, and upheld by all members of the board as if it had been a decision that each made individually. No member has the authority to speak for the board unless specifically authorized to do so by the whole board. The board's policies are the board's voice.

(3) Board decision should be policy decisions: Because the board's voice is expressed in its policies, board decisions are always an amendment of, or an addition to, existing policy.

(4) Boards should formulate policy by determining the broadest values before progressing to narrower ones: By "nesting" policies, boards delegate details and concentrate on why those details matter. For example, instead of deciding that staff members should receive a certain number of vacation days each year, the board first decides that fair and competitive staff treatment is a board value, and then expects the CEO to interpret this policy.

(5) The board should define and delegate rather than react and ratify: If a board truly chooses to govern, then it must not be led by staff members or by its own committees. The board itself should work incessantly, continually, and obsessively to define the results the organization is to produce (Ends policies) and to define the "acceptable boundaries" (Executive Limitations policies) within which it can delegate the achievement of those results to the CEO.

(6) Ends determination is the pivotal duty of governance: On behalf of the moral ownership (which can not conveniently assemble on a regular basis), the board must paint the target toward which the staff should shoot in terms of the benefits to be produced, the people to be served, and the cost of meeting those goals.

(7) The board can best control staff means by limiting not prescribing: Although boards often try to develop comprehensive "to do" lists for CEO's and staff members, boards cannot oversee all the details involved. It is easier, and in fact, more complete, for a board to tell the CEO what should be achieved on behalf of the moral ownership (Ends) and then to allow the CEO to use his or her expertise and experience to determine how best to get there within the limits of law, prudence, and ethics (Executive Limitations).

(8) A board must explicitly design its own products and processes: Because the board's governance function is distinct from the staff's management function, the board must determine its own definition of governance and then decide how it will actually govern. All board members should clearly understand why the board exists; the purpose is not to oversee staff but rather to define the future on behalf of the moral ownership and to ensure that the future is achieved in a legal, ethical, and prudent manner. The board must be accountable for its own performance.

(9) A board must form an empowering and safe linkage with management: Role clarity means that the board clearly knows its own role and the staff's role and that the staff has a similar understanding.

(10) CEO performance must be monitored rigorously but only against policy criteria: In a fair contest, contestants are only judged if they know the rules. Similarly, in Policy Governance ® the board judges the staff only according to the board's own rules, and the staff will know those rules because they have been stated in policy.