Answer to Question #123377 in Management for Lizah

Question

Conduct a review of the governance of your organisation (or one with which you are familiar) in the form of a report to the Chairman (or President) of the Governing Board of Directors. In the brief report use the concepts, tools and techniques learned in this subject to review the structure, process and effectiveness of the governance of the organisation and to make recommendations for appropriate improvements

Answer 1

Corporate Governance can be described as "The framework of rules, relationships, systems and processes within and by which authority is exercised and controlled in corporations.” Gympie Regional Council has gone through its fair share of major changes in the last 20 years, including forced amalgamations in 1993 and 2008. Prior to the 2008 amalgamation, the council areas had divisional representation – where the council area is divided and a resident of that division is elected to represent that particular division on council. This divisional representation was removed during the amalgamation process by the sitting councillors. Public backlash resulted in community consultation and, in October 2011, after much heated public debate, the Local Government Change Commission recommended that Gympie Regional Council operate under a divisional arrangement, resulting in eight divisions.

At a corporate level, there has also been major change, with the appointment of a new Chief Executive Officer nearly two years ago. The incoming Chief Executive Officer has brought about many changes, including two structural reviews, dropping back from 5 to 4 directorates, existing positions becoming redundant and personnel from outside the region being appointed to new positions to name a few.  The appointment of new Chief Executive Officer from outside the region (and another state!) to replace a very popular Chief Executive Officer (who was a local) has been difficult for long standing council officers, as it was felt that the outgoing Chief Executive Officer had been ‘pushed’ out. Speculation amongst council officers is rife that there will be another drop from 4 to 3 directorates within 12 months.  The corporate branding has also undergone a massive change at a cost that council officers believes should have been spent on more deserving requirements such as increased staffing, better IT, etc. From the ‘coal face’, it appears that these decisions are being made without consultation and by the Chief Executive Officer alone.

As the majority of council officers live in the region, this means that they are also ratepayers. It is not as common in private enterprise as it once was that employees were also shareholders, with shareholders of companies more and more being institutions rather than individuals. This means that not only does there need to be transparent and accountable corporate governance when it comes to the general public, it should flow throughout the whole organisation.

The Chief Executive Officer has a significant role in the promotion and provision of effective corporate governance. The responsibilities of the role are varied and include establishing and maintaining an appropriate organisational structure, making sure that decisions are implemented in a timely manner and developing a code of conduct for council officers. One of the more important roles is promotion of a positive culture of good corporate governance. When the Chief Executive Officer is seen to be actively promoting evenly balanced corporate governance, council officers are far more likely to be supportive.