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A new scale of governance challenge

27 September 2016 by Kirsty Watt

Academies: A new scale of governance challenge - read more

Many more highly-skilled people are needed to lead academy trusts through the next phase of change

Few can fail to have noticed that the education system in England is changing. The number of academies – independent, self-governing, state-backed schools funded directly by government – has grown from around 200 in 2010 to nearly 6,000 in 2016. In any sector that rate of growth would be transformative. Couple that with the trend for academies to join together to create multi-academy trusts (MATs) and you have a new scale of governance challenge emerging.

The good news for education is that high-calibre people relish change and leaders from other sectors are stepping forward to volunteer for academy non-executive director (NED) roles. Academy Ambassadors is a non-profit organisation that helps build better MAT boards by recruiting talented business leaders as volunteer NEDs. Through our introductions, we have helped over 280 board members join MATs.

This year, we commissioned independent consultants, Populus, to conduct research to find out more about the experience of those joining MATs from outside education. The two major motivating factors behind the NEDs decision to get involved was the challenge and the chance to make a real difference to young people’s lives at scale. As one appointed NED said: ‘the appeal was of helping a chain of schools provide a better education for children in more deprived areas.’

Many more highly-skilled people are needed to lead trusts through the next phase of change. Newly formed and small MATs need to establish governance arrangements from scratch. Larger and growing MATs must review their governance arrangements to ensure they remain fit for purpose to drive financial efficiencies and higher performance. As the Government encourages more schools to become academies and to join MATs, demand for external expertise may exceed supply.

In a survey of 20 large MAT boards, there were surprisingly few members with previous board experience from another sector. Beyond education, the most common professional experience of a board member is finance. Wider business and commercial skills beyond finance are still rare. Of 248 individuals, across 20 large MATs profiled, 10 note a HR background and nine a legal background, with 28 showing membership on charity or voluntary sector boards.

Classic governance skills are much needed and ICSA’s recent blog ‘Five essential qualities of a non-executive director’ is a good guide to the abilities needed to have an impact in an MAT role.

Big picture thinkers

NEDs need to be strategic thinkers to guide MATs through the education landscape at a time of great change. The bar is already set high: ensuring better academic standards for every child, guaranteeing safety and improving financial management.

Almost all NEDs that took part in our research feel able to drive change in their MAT and make a positive impact on the trust and its outcomes. Examples of impact cover every aspect of governance and MAT strategy, from reviewing growth strategy and assessing financial risks, to continuity planning.

Assessing the big picture on risk remains a top priority as boards steer their trusts through financial pressures and demographic, curriculum and exam change. The best NEDs also report a proactive approach to identifying opportunities for growth, such as setting up new free schools in response to demand and taking over failing schools.

As we enter a period of further reform with the publication of the government consultation document, ‘Schools That Work for Everyone’, boards will have new questions ahead: whether to partner with a university or independent school and how to address demand for academic selection.

Governance knowledge

An understanding of governance is essential for an NED in an MAT as much as any other sector. The three core features of good MAT governance that our participants have identified will be familiar to ICSA members:

  • Drawing on the experience and expertise of a wide range of NEDs and combining the views of both educationalists and those from business
  • Continuous review of governance arrangements to ensure NEDs with the right skills are in place for each stage of an MAT’s growth
  • Effective challenge and scrutiny of the executive by NEDs on areas such as educational outcomes, long-term growth, financial management, and vision and ethos.

Education is a highly regulated environment and NEDs need good orientation and induction. Poor induction and training remain concerns among new NEDs. However, the picture is improving: Academy Ambassadors has recently introduced new induction essentials, organisations like ICSA are here to help and trusts are learning the value of structured inductions.

Board recruitment is being taken increasingly seriously as a part of embedding good governance systems in education. MAT CEOs and chairs talk of moving away from informal recruitment and ‘accidental’ board structures, to rigorous recruitment based on board audit.

Independent mindset

Advocating for the right thing, not the most expedient, is critical when young people’s life chances are at stake. All trusts are expected to help their most disadvantaged pupils catch up quickly and well-performing trusts should be encouraged to reach out and support schools with generations of under-performance. The board members that Populus interviewed spoke passionately about the power of education. Independent board members have a critical role ensuring that the most vulnerable pupils have the opportunity to succeed.

For many, a belief in the importance of good schools extends to the wider social impact made possible by education. From higher incomes and equality of opportunity, to reducing poverty and improving the health of the nation, NEDs at MATs speak strongly of the importance of good schools and the wider societal contribution they make.

One NED said: ‘I believe in the longer term that the way we advance the UK economy, advance UK competitiveness, improve social standards and welfare across the UK is via education. It is a deeply rooted personal belief that I think a lot of other people seem to share. So that is why education is for me.’

Ambassador potential

Most of the trusts we work with are ‘sponsor’ MATs, which means that they take on failing schools and are charged with turning round educational and financial performance. The turnaround can be rapid: primary school academies, for example, improve at twice the rate of more traditional local authority maintained schools.

In these circumstances, however, there will sometimes have been a crisis of confidence along the way among staff, pupils and parents. Strong MAT NEDs and particularly chairs make it their mission to help the trust rebuild school performance and confidence. Skills in marketing, reputation management and communication are consequently in demand.

External board members also frequently find themselves encouraging the schools in the trust to take a more external perspective. The business leaders in particular that we recruit encourage greater education-business links by driving up opportunities for students to engage with the world of work.

Nikki King, former Chief Executive of Isuzu Trucks, joined Greenacre Trust as Chair, not only to support the trust through good governance and financial stewardship, but to also close the gap between education and business. She said: ‘We began this strategy with the belief that education is not for children but for the adults they will become, so we first looked at how we wanted our young adults to be in 10 years’ time. Like many of us who run businesses, I felt strongly that today’s school leavers were generally unemployable. After many years complaining about this situation, I decided to do something about it. The big picture is that our teaching, extracurricular activities and educational offer have a focus on life skills and life after education. This is a work in progress but the staff, governors and parents are really bubbling with enthusiasm.’

Energy and commitment

The role of an MAT NED is demanding but rewarding. The NEDs we introduce to MATs are motivated, engaged and committed. Almost all NEDs interviewed are positive about their role; they bond quickly with educationalist colleagues, feel able to make a valued contribution and are intellectually stimulated.

A monthly time commitment of between six and 12 hours is typical for MAT NEDs, with chairs obligations ranging upwards from this level, and what they get back is a fulfilling experience. As one NED commented: ‘Meeting the other people on the MAT board has been a lot of fun, particularly the people who do not come from business backgrounds. To understand how they come at it and to see the issues they are interested in versus the ones that I pick up on, has been absolutely fascinating for me, particularly on educational standards and risk management.’

Kirsty Watt is Head of Academy Ambassadors

The ICSA Academy Governance Conference

Kirsty Watt spoke at ICSA’s Academy Governance Conference on 4 October. For more information or to view the conference slides, visit our Academies resource hub.

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