This document provides information and recommendations about effective school board governance practices. It discusses the importance of transparency, accountability, clear roles and responsibilities, oversight of finances and student achievement, and adherence to standards like those in the Sarbanes-Oxley Act. The effects of poor governance like losing accreditation or lawsuits are also reviewed. Best practices around policies, committees, audits, and training are recommended to help boards govern effectively and avoid costly mistakes.

1. GovernancePolicies & Board CommitteesPurpose, Performance and Practices Tanya J. GiovanniStaff AttorneyNCSBAPolicy ConferenceJune 18 & 19, 2009

2. DisclaimerTHIS INFORMATION IS INTENDED AS AN AID FOR SCHOOL BOARD MEMBERS AND IS NOT TO BE CONSTRUED AS LEGAL ADVICE.FOR SPECIFIC LEGAL ADVICE, PLEASE CONSULT YOUR BOARD ATTORNEY.

3. Let the Sun Shine InTransparency and accountability should not only come after a lawsuit or a grassroots effort to get rid of the board. As stewards of the public trust, school boards have a very important responsibility to ensure the school system is run wisely, efficiently and properly.

4. Good governance . . . provides a framework and a process for the allocation of decision-making powers.

5. requires clarity and a shared understanding of roles, responsibilities, rules and reporting.

6. sets forth what the school system is and how it will conduct itself.Boards committed to good governance . . . are accountable and provide oversight.

7. have a stable, and economically viable work environment for staff

8. have an educational environment for students that targets success and achievementSarbanes-Oxley ActFinancial advisors, auditors, attorneys, companies providing liability insurance, bond rating agencies, or members of corporate boards of directors may expect that the practices mandated by Sarbanes-Oxley should also be applied to oversight of public school operations.Courts may look to this redefined responsibility to help define the school official’s duty of care.

9. Good School Board Governance□ Clearly stated mission that includes high expectations for student achievement□ Allocation of resources in support of the stated goals□ Board holds its system accountable for student achievement through the superintendent by regularly monitoring evidence of student achievement

10. Good School Board Governance□ Engages constituents in the creation of policies that affect them and communicates its progress in raising student achievement□ Board monitors its own performance and takes action to continually improve its governance processes.

11. Good School Board Governance□ Focus by the board on student achievement and policy□ Effective management by the board without micromanagement□ Trusting and collaborative relationship between the board and superintendent□ Evaluation of the superintendent according to mutually agreed upon procedures

12. Good School Board Governance□ Effective communication between the board chair and superintendent and among board members□ Effective board communication with the community□ Governance retreats for evaluation and goal setting purposes

13. Present TimeSchool boards are responsible for virtually every aspect of education. A very real and pressing need for ongoing training and board development in school governance to meet these statutory demands.No longer just sit overseeing legal compliance; boards have affirmative duties and are accountable for meeting academic performance standards.

14. EFFECTS OF POOR GOVERNANCE

15. Failure to Thrive

16. What else happens when governance goes wrongBoard behavior was so bad the board attorney resigned. The school district lost almost $550,000,000 Million Dollars in housing equity and untold amounts in lost business opportunities.

17. What is the worst that could happen?The school lost its accreditation with Southern Association of Colleges and Schools.

18. The new board advises it is heavily focused on training in boardsmanship, parliamentary procedure, ethics, finances, conducting meetings. Best Practices Board Authority & Duties --- NCSBA Policy 1010Governing Principles ---NCSBA Policy 1100Operational Goals ---NCSBA Policy 2000Code of Ethics ---NCSBA Policy 2120Retaliation---NCSBA Policy 1760/7280

19. Best PracticesWhistleblower --- Generic SampleConflicts of Interest ---NCSBA Policy 2121Conflict Disclosure Form --- Generic SampleGift & Disclosure Form --- Generic Sample

20. Code of Ethics/Conduct Policies should provide guidance on proper conduct, civility and communication within the board and between board members and the public. Board should adopt a code of ethics that exemplifies highest standards of conduct.

21. Conflicts of Interest A sitting board member, who was also a licensed attorney, represented a former teacher who was suing the school board and attempted to participate as both the attorney and a board member in the dispute.IRS Form 990 best practices suggest a disclosure form that raises the bar on disclosure of actual and potential conflicts.

22. Whistleblower ProtectionOne of the only express provisions of Sarbanes-Oxley that applies to schools is the requirement that the entity have a written whistleblower policy that provides a place to report illegal conduct, anonymity for whistleblower, and procedures for handling complaints

23. Litigation is Big Business$2,003,000 verdict – An elementary school principal alleged that after she reported two teachers for abusing children she was transferred and placed on leave in retaliation.$1,000,000 verdict- Two teachers reporting alleged improper test procedures.

24. RECOMMENDATIONRetaliation/whistleblower claims are currently a hot area. The large verdicts indicate juries are sympathetic to employees who report alleged wrongdoing by school systems.Consult your board attorney before taking any personnel action that could result in a whistleblower claim.

25. Document Retention and Destruction PolicySarbanes Oxley--- Makes it a criminal offense for: “any organization” to knowingly alter, destroy, mutilate, conceal, cover up or falsify any record, document or tangible object, with intent to impede, obstruct or influence the investigation or administration of any matter within jurisdiction of any US agency or bankruptcy case.

26. Contemporary Committee StructuresThe current practice recommends that board committees follow the four key governing functions: 1. Board operations and coordination; 2. Strategic and operational planning/budget preparation; 3. Performance oversight and monitoring; and 4. External/community relations.

27. Standing committeesA governance or executive committee responsible for planning board agendas and coordinating the work of the other standing committees.A planning committee responsible for overseeing board involvement in strategic and operational planning and annual budget preparation and for reviewing and recommending key planning actions to the board.

28. Standing committees (cont.)A performance-monitoring committee responsible for keeping track of educational and financial performance and for recommending updated operating policies to the board as appropriate.An external affairs committee responsible for overseeing the relationship with the public at large and with key people in the community.

29. Audit Committees In the final analysis, the school board is ultimately responsible for adopting system-wide policy and philosophy, including the internal financial controls to protect the school system’s assets. Audit committees are quickly becoming a necessary and best practice in board governance.

30. Expensive Lessons A $2.25 million dollar budget shortfall results in criminal convictions and the school board saying ‘We may be stupid but we are not liars.’ School finance officer serves at the “pleasure” of the superintendent. N.C.G.S. §115C-435. $12 Million dollars charged to pay dry cleaning bills, rent, personal travel costs, four mortgages, a Lexus and Jet Skis.

31. RECOMMENDATIONEstablish an audit committee as a standing committee of the board to provide oversight of financial policy and practices and to report on the management of risk.