Roles and responsibilities of the board of directorsDocument Transcript
Roles and Responsibilities of the Board of DirectorsThe Board governs by fulfilling the following roles:Policy FormulationEstablish policies to provide guidance to those empowered with the responsibility to lead andmanage QHC operations.Decision-MakingOn matters that specifically require Board approval, choose from alternatives that are consistentwith Board policies and that advance the goals of QHC.MonitoringMonitor and assess organizational performance and outcomes.The Board is responsible to:Establish Strategic Direction • Consider key stakeholders and health care needs and engage the community of diverse persons and entities when developing plans and setting priorities for the delivery of hospital-based health care; • Establish and periodically review and update QHCs mission, vision and values; • Contribute to the development of and approve the strategic plan of QHC, ensuring that it is aligned with the provincial strategic plan, the LHIN integrated health services plan and conduct a review of the strategic plan as part of a regular annual planning cycle; • Ensure that its decisions are consistent with the Ministrys provincial strategic plan, the LHINs integrated health service plan, and QHCs mission, vision, values and strategic plan; • Monitor corporate performance regularly against the approved strategic and operating plans and Board-approved performance indicators.Provide for Excellent Management • Select and appoint the President and Chief Executive Officer (CEO); • Establish measurable annual performance expectations in cooperation with the CEO, assess CEO performance annually and determine compensation; • Delegate responsibility and authority to the CEO for the management and operation of QHC and require accountability to the Board; • Select and appoint the Chief of Staff; • Establish measurable annual performance expectations in cooperation with the Chief of Staff, assess Chief of Staff performance annually and determine compensation; • Delegate responsibility and authority to the Chief of Staff for the supervision of the practice of [medicine, dentistry, midwifery and extended class nursing] in QHC and require accountability to the Board; • Provide for CEO and Chief of Staff succession; • Ensure that the CEO and the Chief of Staff establish an appropriate succession plan for senior management and professional staff and establish a Medical Human Resource Plan; • Review annually the succession plan for senior management; • Appoint chiefs and other medical leadership positions, on the recommendation of the Chief of Staff, as required under QHCs professional staff by-laws and the Public Hospitals Act; and
• Establish and monitor implementation of policies to provide the framework for the management and operation of QHC in compliance with applicable laws and regulations.Ensure Program Quality and Effectiveness • Be assured as to the effectiveness and fairness of the credentialing and privileging process and review and approve appointments, reappointment and privileges for medical, dental, midwifery and extended class nursing staff (Nurse practitioners, who are not employees of the hospital and to whom the board has granted privileges to diagnose, prescribe for or treat as out-patients in the hospital) as recommended by the Medical Advisory Committee, in consideration of QHCs resources and the strategic plan; • Provide oversight of the credentialed professional staff through the Chief of Staff, Chiefs of Departments and the Medical Advisory Committee and if necessary or advisable, effect the restriction, suspension or revocation of privileges of any credentialed professional staff member as provided under the Public Hospitals Act, following recommendation by the Medical Advisory Committee; • Establish quality goals and performance indicators (using best practices and benchmarks) and monitor indicators of access, clinical outcomes, quality of service and patient satisfaction; • Ensure the development of a process for identifying, managing and monitoring organizational risks; • Ensure that policies on utilization and patient safety systems are in place and operating effectively; • Ensure that policies are in place to provide a framework for addressing ethical issues arising from administration, clinical care, education and research in QHC; and • Ensure that management has plans in place to address variances from performance standards, including management of complaints, and oversee implementation of the remediation plans.Ensure Financial Viability • Approve the annual operating and capital budget and monitor financial performance periodically against the budget and agreed-upon indicators; • Ensure that management undertakes multi-year financial planning, optimizes the use of resources, operates within the resource envelope and the Hospital Accountability Agreement and manages to approved levels of risk; • Ensure policies are in place on asset protection, insurance, procurement, leases, borrowing and signing authority; • Approve an investment policy and monitor compliance; • Ensure that management has measures in place to ensure the integrity of internal controls; and effective management information systems; and • Review and approve the Corporations financial statements at least quarterly and the report of the auditors at least annually. • Ensure that the Members appoint qualified auditors.Ensure Board Effectiveness • Recruit Directors who are, skilled, experienced and committed to QHC and plan for the succession of Directors and Officers; • Establish a comprehensive Board orientation program and ongoing Board education; • Establish Board goals and an annual work plan for the Board and its committees and ensure that the Board receives timely appropriate information to support informed policy formulation, decision-making and oversight;
• Establish and periodically review policies concerning governance structures and processes to maximize the effective functioning of the Board; • Establish a policy and process for evaluating the performance of the Board as a whole and individual Directors that fosters continuous improvement;Build Relationships • Ensure that QHC builds and maintains good relationships with the Ministry and the LHIN in fulfilling QHCs accountability agreement with the Minister and/or its service accountability agreement with the LHIN; • Ensure that QHC is filling its role within the LHIN region by fostering effective coordination of patient care and positive working relationships with other community health care providers; • Ensure that mechanisms are in place for effective communication within QHC with professional staff, employees, volunteers, Foundations and with its members, community stakeholders, including political leaders and donors, and the broader public.Roles and Responsibilities of a DirectorAccountability and Fiduciary DutiesA Director acts ethically, honestly, in good faith and makes decisions that are in the best interestsof QHC and in so doing, supports QHC in fulfilling its mission and mandate and discharging itsaccountabilities. A Director exercises the care, diligence and skill that a reasonably prudentperson would exercise in comparable circumstances. Directors with special skill and knowledgeare expected to apply that skill and knowledge to matters that come before the Board. A Directordoes not represent the specific interests of any interest group. A Director complies with allapplicable laws, including but not limited to the Public Hospitals Act, the Corporations Act, by-laws and Board policies.Exercise of AuthorityA Director carries out the powers of office only when acting as a voting member during a dulyconstituted meeting of the Board or one of its appointed bodies. A Director respects theresponsibilities delegated by the Board to the President & CEO and Chief of Staff.ConfidentialityEvery Director shall respect the confidentiality of matters brought before the Board and allcommittees, keeping in mind that unauthorized statements could adversely affect the interests ofthe Corporation.Conflict of InterestA Director complies with QHC Board of Directors Conflict of Interest policy as prescribed in theSection 4.06 of the Administrative By-Laws.Team WorkA Director works positively, cooperatively and respectfully with all members of the Board ofDirectors and the management team in the performance of his/her duties.
Policy SolidarityThe official spokesperson for the Board is the Chair or Chief Executive Officer. A Directorsupports the decisions and policies of the Board in discussions with outsiders, even if the Directorholds another view or voiced another view during a Board discussion or was absent from theBoard meeting. A Director refers requests for statements on behalf of the Board to the BoardChair or Chief Executive Officer.Formal Dissent at a Board meetingA Director who is absent from a Board meeting is deemed to have supported the decisions andpolicies of the Board taken in his/her absence unless he/she formally records a dissenting viewwith the Board secretary.AttendanceA Director is generally expected to attend all of the Board and assigned committee meetings andBoard retreats. All Directors are expected to serve on one or two committees and to represent theBoard when requested. Unless otherwise decided by the Board, a Director is deemed to haveresigned from the Board if that Directors is absent for: three (3) consecutive regularly scheduledmeetings of the Board/ Committee to which he/she is appointed or if a Directors is absent for four(4) or more of the regular meetings of the Board in a twelve month period or misses a majority ofregularly scheduled committee meetings during one Board year.Participation - A Director comes prepared to meetings (of both Board and its Committees) andevents, asks informed questions, and makes a constructive contribution to discussionsCompetencies - A Director actively contributes specific expertise, skills and other attributes thatare needed on the Board.EducationA Director takes advantage of opportunities to be educated and informed about the Board and thekey issues related to QHC and broader health system through participation in initial orientationand ongoing Board education.Self-evaluationA Director participates in the self-evaluation of the Board and individual Directors."Role of CEO/Chairman/Non-Executive Director"There is often confusion around the roles and responsibilities of company leaders. In particular, one very critical relationshipcan suffer from the lack of clarity regarding duties and responsibilities and create friction and impaired productivity - or worse- at the highest levels: Chairman and CEO.Overall, the CEO leads internally, with the Chairman adding value in strategy and structure and ensuring that the company isrepresented with integrity and influence to institutions, analysts and other stakeholders. The Chairman is there to support the
CEO, and both need regular and structured access to the Executive and management team. Clearly, the Chairman must also be prepared to step in if deemed appropriate. It is absolutely critical that this Chairman / CEO interface is working and is seen to work (this is why there is a danger in the chairman and CEO being one and the same). Otherwise this dysfunctionality will affect the Board performance and the wider relationships between the Executive and Non-Executive Directors. Some of the more common reasons for the relationship going wrong can include:• An imbalance in power• Critical issue of external representation• Critical issue of internal access• Lack of mature judgement and flexibility• Lack of ability to conflict and confront A meeting of minds Ideally, the CEO/Chairman relationship is complementary and dynamic, and both parties have clarity on their involvement, accountability and remit. Where there is a well developed relationship of mutual respect, there will be regular contact between the Chairman and Chief Executive that allows for much greater reciprocal understanding and clarity of communication. The role of the Chief Executive is often isolated and a strong relationship with the Chairman also provides a “sounding board” to test and debate new thinking and to air concerns and worries that cannot be shared with others in the Executive team. For this to work effectively there must be a high degree of trust and confidence that the Chairman is not seeking to be a surrogate Chief Executive. Other attributes of a good Chairman include:• Mature, internal compass of values, integrity and judgements• Long-term strategic perspective• Unconditional positive regard for others• Creative, curious and challenging• Ability to master the brief• Ability to weather crises• Leader for different seasons Mastering the role CEO, Chairman and Non-Executive Director roles each have a commonly-accepted set of duties and responsibilities. Whilst there will be differences as a result of size, listing status and investor mix, these are the normal guidelines in the UK. Role of CEO• Runs the company’s business• Responsible for operations and financial performance• Provides clear leadership• Executive Directors report to CEO• Prepares strategy, plans, objectives etc. and implements• Submits acquisition / investment proposals and implements• Develops organisation structures, succession planning
• Together with Chairman, communicates to investors etc.• Submits proposals on Non-Executive fees to the Board Role of Chairman• Runs the Board - organises, with Company Secretary, the Board committees etc.• Maintains consistent strategic input and scrutiny• Enhances the standing of the company with the outside world. Communicates with investors the strategic content and architecture of accountability.• Recommends to the Board the appointment / dismissal of the Chief Executive and Non- Executives• Reviews the performance of Non-Executives and keeps them informed• Assists and guides the CEO (acts as mentor / coach)• Reviews the performance of the Directors• Ensures the Board annually reviews its performance and is balanced Role of Non-Executive Director Independent (or Non-Executive) Directors are primarily valued for their objective judgement of corporate affairs. They need knowledge of the technical and legal aspects of directorship and may have a specific skill that can be exercised from time to time. But for the most part, their contribution will be rated by their overall knowledge and wisdom. Judgement cannot be learned from reading a book or attending a course - neither can wisdom. The best course for anyone wishing to become an independent Director is to build on their own business experience and develop judgement by exposing and testing this knowledge and experience in many different situations and learning from a wide cross-section of individuals. An independent Director legally bears the same responsibilities as the Executive Directors, but achieves effectiveness by influencing decisions rather than controlling operations. The field of independent directorship is in no way risk free; it should not be entered lightly. It carries significant exposures, of financial liability, possible disqualification, and consequential damage to future careers.