What makes an effective board?

As part of aged care reforms, from December 1 2023, all approved aged care providers will need a governing body and a supporting advisory body. For the most part, established aged care providers already have a board in place, but not all do. With the clock ticking down as December nears, finding the right composition and mix of individuals who can offer effective insight and experience for your board is essential. 

What are the Government requirements?

• Under the Aged Care and Other Legislation Amendment (Royal Commission Response) Act 2022, all approved aged care providers must have a governing body featuring a majority of independent non-executive members and at least one member with experience in providing clinical care
• Providers must also have a quality care advisory body and a consumer advisory body to support governance and consumer interest, respectively
• For transparency purposes, the Aged Care Quality and Safety Commission must be notified about changes to key personnel and general operations
• More information can be found on their website

Efficiency is critical but it can be challenging to hit the right balance when forming a board for the first time. These guiding principles should set you up for success when establishing a board. 

A clear purpose

Depending on the size and scope of your organisation, your board could be responsible for any number of things: budgets, governance framework, reviews and audits, strategic direction, etc. Boards are never short of work, but the most effective boards have clarity towards direction and purpose; too many competing priorities mean certain tasks are ignored while impactful outcomes are delayed. 

So no matter what stage of life the board is in, conception or otherwise, outline its purpose. It could be working towards a merger, expansion, or a change in ownership. Whatever the reason, ensure there is clarity from day one. Equally important is individual purpose. Why are they a part of the board and how do you expect them to contribute? Expectations need to be defined and shared for success.

The right mix

Board composition is essential to creating and sustaining an effective environment. Your directors need the right skill sets, experience and diversity to make the most impact. So who exactly should you look for when establishing a board?

• A mixture of independent and interested directors for insider and outsider perspectives
• People with previous experience in boards who can bring instant guidance
• C-level executives and non-executives with invaluable leadership, knowledge and experience
• Members from various professions and backgrounds to address all strengths and weakness
• Diverse members of different cultural backgrounds, ages, genders, educational backgrounds, etc
• At least one industry expert to offer insight into growth and development

A manageable size

An effective board should be a manageable size, but also reflective of your organisation’s overall size. For small-to-medium providers, five members are often the perfect composition, while medium-to-large providers could have up to eight members. Ultimately, it should be big enough or small enough to complement internal resources and experience. With the addition of advisory boards, you may also find some overlap or a need to break up the overarching governing body into smaller focus groups. 

Committed members

Your board of directors is there to be relied on when making major decisions. Therefore, you need members who are committed to the cause. Look for candidates who have a vested interest in the aged care industry, or have a proven track record of helping similar organisations. They should be a good fit for your culture so you know their advice is going to benefit your mission.

Additionally, consider what you deem to be effective participation. Although technology means a board member can participate from anywhere in the world, perhaps you want to see an initial team based locally who can put their feet on the ground to really engage with the organisation. People who also like to participate in multiple boards may not be available when you need them, so consider those with industry experience looking to establish a presence with a new board. 

Change and challenge

All good boards must change. Over time, your organisation’s priorities will change, your goals will shift and your directors will give all they have. So to truly be effective, ensure you have fixed terms and regular board turnover to bring in fresh ideas and guidance. 

This will help you better plan towards key tasks requiring specific insight and experience while also allowing for new members to come in and challenge the status quo. Change such as this means you can always meet the evolving needs of your consumer base and stakeholders.