The Governance Route Master

Governance is formally defined as “systems and processes that ensure the overall direction, effectiveness, supervision and accountability of an organisation” (Comforth 2003) 

Getting the governance right is probably the most important task of any social enterprise, many of whom organise themselves with a Board of Directors to fulfil that role.  Getting the right blend of skills on that Board is crucial (see Typical Board Requirements below).

In many cases social enterprises can learn from the good practice of other organisations, especially those in the voluntary or NGO sector.  An excellent guide is the Schwab Foundation pbblication Governing Social Enterprise.  But there also some differences that can affect the way we look at governance in the social enterprise sector.

  1. Independent values and objectives.  Not only do these often “trump” other factors affecting governance, such as financial gain or profit but social enterprises have to both establish their own values and objectives independently, along with their stakeholders and apply their own internal criteria to monitor and evaluate their application. See Governance and management using the logframe
  2. The socialisation of enterprises.  Our cooperative roots influence many social enterprises who seek to move away from hierarchal structures and attempt to include different stakeholders such as workers, customers, beneficiaries and community in more flat and democratic structures. See the case study on SUMA
  3. Social Innovation.  Social Enterprises exist largely because those involved in setting them up do not agree with the way the world works and are looking for change.  This leads many involved with social enterprise to explore innovation within the governing function for example seeing it more as an inclusive process rather than a rigid structure.  Have a look at the case study on Innotiimi to see an example

These are some of the reasons why we have developed the Governance Route Master. The Governance Route Master is an on line tool that provides a “governance route” for the governors of social enterprises.  The Tool gives access to guides and support information, allows the download of interactive documents that can be shared with whoever is involved in the governance process.  This tool has been developed by us in response to the need for more flexible and inclusive governance processes in keeping with the way many social enterprises are looking to develop.

SOCIAL ENTERPRISE – TYPICAL BOARD REQUIREMENTS

Has the Board these skills?

 

Skill

Example

Representation

Able to represent the views of primary stakeholders

Able to feedback and be accountable to the stakeholders

Management

Have competent Company Secretary and legal knowledge

Chairperson with Chairing skills

Aware of Director responsibilities

Able to supervise the work of the Manager

Planning

Able to make policy decisions

Able to set and monitor long term strategy

Able to set goals and targets

Marketing

Able to set and oversee a marketing strategy

Able to make marketing decisions

Financial

Able to set and oversee funding strategy

Able to understand management accounts

Able to make Financial decisions

Personnel

Able to set and oversee staffing policy

Able to recruit and support the Manager

Values

Able to formulate and review the enterprises’ values

Abe to ensure the enterprise adheres to these values

Social Objectives

Able to set Social objectives

Manage the Social Audit

Understand the needs of the main beneficiaries

Commitment

Able to attend meetings or maintain communication

Able to carry out Board member duties

Be prepared to take part in relevant training

Promotion

Able to promote and champion the Enterprise at different levels e.g. Funding bodies, community groups and Statutory bodies

Resolve conflicts

Able to resolve conflicts within the Board and the enterprise?

 

GOVERNANCE AND MANAGEMENT OF SOCIAL OBJECTIVES FOR SOCIAL ENTERPRISES USING THE LOGFRAME

 

Management Governance

Overall Objectives

The social objectives to which the social enterprise contributes

 

 

 

The Social Purpose

The main benefits that the social enterprise delivers

Indicators

The evidence that proves the social impact

Sources

How the evidence is collected

Assumptions

being made that the benefits contribute to the overall purpose

The Outputs

The services and products that create the benefits

Indicators

The evidence that the outputs are being achieved

Sources

How the evidence is collected

Assumptions being made that the outputs achieve the social purpose

Activities

The activities that produce the outputs, deliver the evidence and respond to the assumptions

 

Resources

The resources required to deliver the actives

Time

The timescales

Finance

The finances needed to fund the resources and activities

 

In this diagram Governance focuses on the social objectives and their impact whilst management is about carrying out the activities that support the objectives.

For further information of the use of Logframe in social enterprise planning contact Social Enterprise Europe - contact@socialenterprise.co.uk