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. . . The Policy Governance@ Model Page 14 of 16 To illustrate the nature of what is reported in a Policy Governance monitoring report, we will use two items from an Executive Limitations policy already shown. In that policy. among other unacceptable means. the CEO was told he or she cannot (1) expend more funds than have been received in the fiscal year to date except through acceptable debt and (2) indebt the organization in an amount greater than can be repaid by certain. otherwise unencumbered revenues within 60 days, but in no event more than $200.000. Here is what the monitoring data might look like for these two provisions: Item 1: Through the end of May. $3,694,800 has been expended. Receipts in the same period were $3,654.728. The shortfall of $40,072 was offset by a $60,000 short term loan. Item 2: Total debt is a 45 day working capital loan for $60,000 incurred on May 25. Revenues of $75,000 from our foundation grant, guaranteed by letter of May 5, are not otherwise encumbered and will be used, in part, to retire the debt prior to due date. Notice that the data are rather bare-bones, only enough to answer the question, unobseured by incidental information. Board members should adopt a "prove it to me" attitude, so if the information submitted is insufficient to convince them, then more detail can be added. But the detail must be such that directly address the criteria. For example, what data prove the "not otherwise encumbered" statement? Obviously. the complexities of some organizations will cause the monitoring data to have more facets than in our simple example. Even then, however, the reported data should be as brief as possible and maintain a razor-sharp connection to the policy-based criteria being monitored. If more interesting, explanatory information, other than that directly addressing the criteria, is desired by the board or offered by the CEO. it should not clutter the monitoring report, but be distributed separately. Board members can know anything they wish, but they should never be in doubt about what is disclosure of performance on the board's criteria and what is not. Using similar criterion-focused reasoning, when the board seeks to evaluate itself, it compares its actual behavior and accomplishment with the behavior and accomplishment it committed to in its Governance Process and Board-Staff Linkage policies (Carver, 1997b). Policy Governance boards tend to self evaluate on a frequent basis-we recommend every meeting-because a more sophisticated system requires continual tending. Board Meetings Because in Policy Governance the board is in charge of its own job. board meetings become the board's meetings rather than management's meetings for the board. Board meetings occur because of the need for board members to learn together, to contemplate and deliberate together, and to decide together. Board meetings are not for reviewing the past, being entertained by staff. helping staff do its work, or performing ritual approvals of staff plans. As a result, many board meetings may not look like traditional board meetings at all, but learning and studying sessions or joint meetings with other boards. particularly in communities where boards rarely talk with each other. The CEO is always present. but is not the central figure. Other staff might be present when they have valuable input on matters the board is to decide. For community boards. with rare exceptions meetings would be open~not to please the law. but because a board commitment to transparency. The board is not merely a body to confirm committee decisions, but the body that makes the decisions. Board committees might be used to increase the board's understanding of factors and options, but never to assume board prerogatives or remove difficult choices from the board table. In contrast to the old bromide that "the real works takes place in committees,"' in Policy Governance the real work takes place in the board meeting. Board meetings should thus be more about the long term future than the present or short term future. . . more about ends than means. . . more about a few thoroughly considered large decisions than many small ones. And by their very character. meetings should demonstrate that the board's primary relationship is with owners, not with staff. hltp://www.earvergovernance.com/model.htm 6/12/2002