Governance and Conflict of Interest; A Viewpoint From A Member

7/29/2019 Governance and Conflict of Interest; A Viewpoint From A Member.

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An Informal Viewpoint from a Union Member on Governance, Duties,

Conflict of Interest and the current IA891 Election 2013.By K.Higgins 09/13

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So I want to share some what I have been taught and my experience with regards to governance and

conflict of interest, as it seems to me that this is a relevant issue in the current IATSE local 891 election.

Already there seems to have been some significant publicshenanigans taking place in the format ofheated board meetings, screaming matches between the Board and the candidates, assistant stewards

who are employees actively nominating each other to Executive Board positions to ruffle some

feathers, while also informing and promoting their candidacy/nomination on sets around the lower

mainland during their working hours and finally, and least personally appreciated, candidates bugging

me at my workplace with the intent of engaging me in their self-interested and biased perspective while

building their voter base.

As many of you know, Ive experienced my fair amount of organic compostable bovine substrate overthe years, so lets add some factual information to this process and hopefully we can all hold our noses

and try to elect a somewhat more effective Executive Board to the IATSE local 891.

Lets start with what the Executive Board is actually entrusted to do:

Governance

Governance is often defined as the overall processes and structures used to direct and manage an

organizations operations and activities (Panel on Accountability and Governance in the Voluntary

Sector). The overall goal of Union governance is the protection of the members, employees and

stakeholders interests.

At the IATSE local 891, governance is the domain of the Executive Board, which is comprised of

representatives who are nominated and elected from the ranks the general union membership. It has

been said that proper governance requires an Executive Board to stand outside the organization and

hold it accountable to the stakeholders interest. In the case of the IATSE local 891 the stakeholders

may include any of the following; union members, union workers, volunteers, industry associations

(ACTSafe), governmental organizations (Worksafe BC, BC Labour Board) and even in some cases the

general public.

To be clear, in many progressive governance models and current research; governance and

management are not mutually exclusive functions and there is much overlap between the two. In the

words of one author, the distinction between management and governance is not absolute. In


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traditional governance models (Carver Model) the Board, Executive Director and Senior Management

held mutually exclusive roles and the Board was not to interfere in the daily operations of the

organization. That is also the crux of the problem with the traditional governance model as has a

tendency to develop a highly problematic situation because, in practice, the Executive Director and

Senior Staff are given too much power and may be tempted to abuse that authority.

So what is the role of the Executive Board?

In its governance role, the Board develops policies to provide direction and guidance to the Union. In its

management capacity, the Board is tasked with ensuring the Union has the necessary human and

financial resources so that the organization can function as it was intended and legislated to.

At a minimum the board is responsible for:

Developing a mission statement that provides vision and direction. The agencys financial health including annual budget approval. Proper human resources and employment practice. Ensuring legal requirements are followed. Bylaws. Ensuring Board effectiveness. Administration. Establishment of committees to undertake financial, personnel and planning functions Effective community relations and communications. Hiring the executive director; and Working conditions for all employees.

As individuals, board members are responsible for:

Understanding the organizations mission and mandate; Knowing the boards legal obligations; Ensuring the boards legal obligations are followed; and Understanding financial and budget matters.


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In order to fulfill ones legal responsibility, Executive Board should have a familiarity with tax law

and employment legislation that is specific to the work of the organization.

The law has also imposed fiduciary responsibility on all boards of directors. This means that board

members are required to ensure the organizations best interests are paramount. Fiduciaryresponsibility also means that the conduct of board members must not be based upon personal gain

or for the benefit of friends and/or family and the confidentiality of information must be respected.

Fiduciary responsibility also means that board members are required to regularly attend meetings.

The board is also liable for the organizations financial situation. Hence, it is responsible for ensuring

the existence of sufficient financial resources, for the establishment of financial controls to offset

potential liability, and it is accountable to the legislation in which its functions are overseen such as

labor code, workers compensation act, human rights act, privacy act etc.

It is vitally important that board members know their duties and responsibilities as the courts have

said that it is no longer possible to be a passive director or willfully blind. Lack of knowledge or

passive participation will not absolve the any Executive Board member of legal responsibility. Legal

responsibility or liability can and should exact a heavy price on Board members who fail to take their

responsibilities seriously.

So what is effective and ineffective governance?

Well, it is easy to spot a Board in trouble. Here are some of the more prominent warning signs:

Excessive or acrimonious turnover of the senior staff and board members. Difficulty in recruiting credible board members. Chronic financial deficits (anything over a span of two years). Low attendance or participation in board meetings, committee, departmental meetings, and

general meetings.

Failure to address Board conflicts of interest in a timely manner. Poor communications with members and stakeholders. A rotating door of organizational consultants with a multiple vague and unimplemented

strategic and organizational plans.


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Poorly-run boards give rise to unaccountable practices, non-transparency, and poor communications

with clients, staff, union members, stakeholders and the general public. Ineffective governance imposes

a level of dysfunction upon the Union and could eventually lead to organizational failure.

The characteristics of an effective board, on the other hand, support and maintain accountability.

A board that is accountable:

Is accessible and responsive to union members, staff, employer clients and the stakeholdercommunity at large

Is transparent in that it freely and accurately discloses information about its governance,finances and operations to all relevant parties.

Operates with a sense of Responsibility, Integrity, Honesty and Respect. Embraces and is respectful of diversity and inclusiveness. Provides for constructive conflict resolution. Regularly monitors adherence to applicable laws, regulations and bylaws. Involves stakeholders in planning and evaluations. Educates board members as to their roles and responsibilities. Develops and implements financial, human resources and organizational assessment and

control systems.

Takes action to plan for the succession and diversity of the board. Provides for regular, objective assessment of the board, executive director and organizational

performance.

Provides a healthy work environment.Transparency and accountability are the two buzz words of all Executive Board involvement and

show up in most candidate material. So what are they?

Simply put, transparency allows those outside of the immediate and internal organization to see what is

going on. It provides a window to the processes and procedures. Transparency suggests that the Board

operations should be open and visible to interested parties and that, decisions and actions should be

reported to members and stakeholders.


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Accountability demands that someone be responsible. The Board members need to understand where

their responsibilities, duties and obligations lie. They need a clear picture of the scope and limit of their

authority.

Accountability demands that each Board member keep in touch with his or her own sense of ethics.Boards must create and nurture a special type of trust, one that allows their members to discuss and

debate in a courteous yet vigorous manner.

Individual board members must feel that their opinions matter. Decisions must truly be that of the

group and not driven by one or two powerful members. In the end, board governance requires that

each board member supports the collective decisions of the board and will not speak out against them,

publicly. At the same time, morality requires that each board member maintain his or her own sense of

ethics. Sometimes these are the most difficult of conflicts to resolve in unskilled and dysfunctionalexecutive Boards.

All Executive Board members fiduciary duties can be divided into two main duties:

1. Duty of Care,2. Duty of Loyalty

The duty of care imposes on all Executive Board members a duty of competence or skill i.e., a

requirement to act with a certain level of skill; and a duty of diligence. The duty of skill and diligence

must be performed to a certain standard of care. The level and type of skill and diligence an executive

board member must demonstrate can be found in any of the following sources:

The legislation in under which the union is defined and must adhere to, and Various court decisions which attempt to define the standard of care expected of directors.

The duty of loyalty requires that an Executive Board member act honestly and in good faith in the best

interests of the Union and its membership. The duty of loyalty is a personal duty and cannot be

delegated (the no-delegation rule). Among other implications, it means that a Board member is not

allowed to profit from his or her office (the no-profit rule) and must avoid all situations in which his or

her duty to the Union conflicts with his or her interests (the no-conflict rule).

An executive board member must give undivided loyalty to the Union they serve. These Board members

should not put themselves in a position that would create a conflict between their duty to act in the best


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interests of the union and their own personal interest. In general terms, this means that an Executive

Board member should not have any personal interest in any proposed commercial contracts, collective

agreements or employment contracts with the corporation. Nor should Executive Board members take

personal advantage of opportunities that arise because of his or her association with the corporation.

Example: An union employee/union member running for and elected board position is in a personal

conflict of interest as they, once elected, will be in a position to have a direct voice in the negotiations of

their working conditions and wages as both a union Director and Employee whether they are working

under a collective agreement or not.

Conclusion:

Executive Board members, who breach any of their duties to the Union, may be liable if the Union

suffers a loss that can be directly attributed to their actions or omissions. To protect themselves fromsuch liability, the Union executive should always consider whether the decision(s) or action(s) being

taken are in the best interests of the Union.

They must discharge their duties of skill and diligence, as well their duty of loyalty, including acting

honestly and in good faith, not improperly delegating their responsibilities, and avoiding conflicts of

interest.

Taking the above into consideration it seems very obvious that any Executive Board members who also

are in the position of Employees of the Union are very clearly in a conflict of interest. As a result, the

Executive Board should and must take action when an organizational conflict of interest becomes

apparent. At a meeting of the Executive Board, the Board should declare the conflict. The involved

parties then should leave the room for the discussion and abstain from voting on any matter that affects

the Union or employment terms and conditions of themselves. If the conflict is found to be

insurmountable, the Board member may have to resign from one or both positions.

And going forward the Board and the directors should have a clearly defined policy to follow in the

event of a similar conflict of interest. However, the legal validity of any policy that allowed a board to

disregard a conflict of interest in breach of its fiduciary obligations is doubtful. This paper takes into

consideration Board members employed as assistant stewards, administrative assistance and organizers.

Now can we move to minimize the shenanigans at the next meeting..please?!

And just so you know I dont just make this stuff up, a bibliography. >>>>>>>>>>>>>>>>>>


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Bibliography:

Alliance for Non-profit Management, What is the Role of Governance? Available online at

http://www.allianceonline.org

Carver, J. Boards That Make a Difference(Jossey-Bass Inc.: San Francisco, 1990)

Carver, J. & M. Carvers Policy Governance Model in Non-profit Organizations.Available online at

www.carvergovernance.com/model.htm

Gill, M. Governance Dos &Donts Lessons from Case Studies on Twenty Canadian Non-Profits,

Final Report(Ottawa: Institute on Governance, May 2001)

Johnson, H.B. Getting on Board: Legal, Ethical, and Practical Considerations for Nonprofit Board

Members(1997) Winter, Tulsa Law Journal

Panel on Accountability and Governance in the Voluntary Sector (February 1999). Building on

Strength: Improving Governance and Accountability in Canadas Voluntary Sector.Available online

athttp://www.vsr-trsb.net/pagvs/

Now go and vote better.
http://www.vsr-trsb.net/pagvs/http://www.vsr-trsb.net/pagvs/http://www.vsr-trsb.net/pagvs/http://www.vsr-trsb.net/pagvs/

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Governance and Conflict of Interest; A Viewpoint From A Member