FIDUCIARY RESPONSIBILITY AND GOOD GOVERNANCEStudent Governance – Understanding proper governance from the start for success throughout the year.
GOVERNANCE IS A SYSTEM OF CHECKS AND BALANCES FOR YOUR STUDENT ASSOCIATION
A governance framework designed to:
• Restrain acts of harm against the SA
• Promote actions that benefit the principals or beneficiaries of the SA
• SA Bylaws document this system of governance.
Students elected YOU… Your Responsibility…
Ensure the SA does what it is supposed to do
YOU make decisions to run the SA and allocate the resources it produces
STUDENTS delegated authority to YOU to exercise powers of decisions
Make proper and beneficial decisions on behalf of STUDENTS
YOU serve at the pleasure and on behalf of STUDENTS
YOUR ACCOUNTABILITY…Accountability means YOU answer to, satisfy and maintain the support of your STUDENT BODY. They grant you the mandate to govern on their behalf.
MOST
BOARD DISAGREEMENTS
WILL BE OVER
GOVERNANCE
ISSUES!
PRINCIPALS OF GOOD STUDENT GOVERNANCE Boards are responsible for increasing
student value.
Boards delegate operations to management.
Management is accountable to the board.
Students are the source of the Board’s power, authority and legitimacy.
BOARD MEMBERS HAVE A FIDUCIARY DUTY TO THEIR STUDENTS!
Fiduciary Duty
Defined: the legal duty to act honestly, selflessly and in the best interests of an individual or organization.
Unconditional loyalty is expected because discretion exists.
People in positions of trust should not gain personally from the power, position or opportunities that arise as result, without consent.
Fiduciary Duty presumes confidence and competence of the Board (YOU) and a vulnerability in the stakeholder/beneficiary.
COMMON EXAMPLES OF FIDUCIARY RELATIONSHIPS
Doctor – patient Lawyer – client Parent – child Executors – heirs Guardian – ward Teacher – student Priest – parishioner Director – corporation Board Member – Student Association
CONFLICTS OF INTEREST
Defined: a situation in which a person has a private or personal interest sufficient to appear to influence the objective exercise of his or her duties/responsibilities.
Potential conflicts for leaders in student associations: Contracting out services Spending on initiatives Advocacy for individuals or small groups of students Nepotism Governance Re-election
BREACHES OF FIDUCIARY DUTY
Breaches are hard to identify – what is unethical or immoral is subjective.
Breaches can be errors of omission.
Financial breaches include kickbacks, commissions, discounts, bribes.
Breaches can be litigated and are compensable.
BREACHES IN STUDENT GOVERNMENT
Circumstances on student boards that can lead to a breach of fiduciary duty:
: lack of experience or knowledge of governance
: “willful blindness” and/or malicious intent
: under-estimating the impact of decisions
: group-think or peer pressure environments
: lack of processes to identify and address conflicts of interest before they occur
EMBEDDING FIDUCIARY BEST PRACTICES Ongoing education of board members on their responsibilities to act
professionally and in the best interests of the organization.
Ensure “Declaration of Conflict of Interest” is a standing agenda item at board and committees.
Publish meeting agendas publicly, ahead of time.
Use in-camera time sparingly.
Create clear policies, procedures, codes of conduct and/or attestations.
Ensure by-laws clearly address how to handle breaches of fiduciary duty.
Seek out advice.
Communicate and be transparent in your dealings (the “Toronto Star” test).
YOU ARE NEVER ON YOUR OWN…
Your SA Executive
Your SA General Manager
Each other - talk it out
SA Staff
Your CSA
Ted Bartlett
Office: 416.340.1212
Cell: 416.948.9951
Email: [email protected]
Twitter: @CSA_ON
QUESTIONS
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