Finding the right skills to ensure good governance
6 August 2020 at 7:30 am
Social enterprises and not for profits gain valuable skills, perspectives and enduring relationships through the non-financial support of their funding partners.
For the past seven years, Victorian-based social enterprise Good Cycles has been creating jobs and employment pathways for disadvantaged youth through its commercial operations. From working in the shopfront in Melbourne’s CBD to fixing bikes, cleaning car-share cars and re-grouting bluestone around the City of Melbourne, these practical services can be transformational for the young people they support.
Like all thriving social enterprises, Good Cycles maintains strong relationships with its funding partners, which can often lead to unexpected opportunities.
Jaison Hoernel, CEO of Good Cycles, says they were looking for someone to join their finance and risk committee in mid-2018 and reached out to Westpac Foundation.
“The next thing we knew we had a new member on our committee in Lucinda, who we invited to join the board a couple of months later,” he says.
Lucinda Makrakis, a commercial credit manager at Westpac, brought over 25 years of risk and finance experience to the table. Joining Good Cycles’ board has allowed her to see how her expertise could be used beyond the banking sector.
“Sometimes it’s not obvious how your banking skills transfer to a business, you just have to dive in and back yourself. But if you’re willing to step outside your comfort zone, the personal growth can be powerful,” Makrakis says.
In 2019, the Good Cycles team and Makrakis took part in Westpac Foundation’s Board Observership Program. Delivered in partnership with law firm MinterEllison, the program is designed to give social enterprises and not for profits the opportunity to bring new skills and expertise to their boards by taking on an observer.
The observer, from either Westpac or MinterEllison, has the opportunity to be part of the organisation’s board over a 12-month period to explore the prospect of a board position in the social sector. Through the program they also participate in a structured governance development program with mentoring from an experienced board executive, who provides advice and guidance along the way.
Participating organisations have the chance to select their observers according to their needs. For Good Cycles, the decision was easy, given Makrakis was already volunteering with them.
“Social enterprises rely on good governance for their sustainability. It provides a framework and helps set expectations. Strong governance also gives the board assuredness to make rapid decisions, like when dealing with the impact of an unexpected global pandemic,” Makrakis says.
Social enterprises, especially those experiencing growth or change, can often find that there are gaps in the skills matrix of their current board members. The program affords an obligation-free opportunity to fulfil that need.
“The program provides organisations with an opportunity to have someone sit at the table with the skill they may need, while also offering a new perspective,” Makrakis says.
Hoernel says it’s important to ensure the individual is the right cultural fit and that their skills align with the existing board members.
“At the time of the program, Good Cycles was growing rapidly so it was important for us to have the right people in place as we tried to expand our business and commercial opportunities,” Hoernel says.
One of the most notable outcomes of the program is the longevity of the relationships formed.
“Another advantage is that it’s evergreen. Instead of discussions about short-term issues, the conversations are ongoing. With Lucinda we’ve got a really strong connection to Westpac and she’s there supporting us all the time,” Hoernel says.
Of the Westpac and MinterEllison skilled volunteers who have participated in the program, two thirds have transitioned to either become a board director or have remained engaged with their respective organisation.
In 2019, Westpac’s Jason Chuang spent 12 months as a board observer with Worldview Foundation, a social enterprise that provides holistic programs and employment opportunities for Indigenous Australians who’ve had contact with the justice system. This year he joined their board as a non-executive director.
Executive director and founding member of Worldview Foundation Jamie Miller says Chuang provided the right perspective at the right time.
“Jason brought an independent perspective and raised questions which assisted our strategic decision making and focused our objectives,” Miller says.
“Jason’s integrity, strategic thinking and focus have strengthened our board and we are looking forward to working with him in the next phase in our growth.”
Based on its early success, the program continues to grow. This year, 27 social enterprises and not for profits are participating in the program with 37 observers.
Some organisations have elected to take on multiple observers to further increase their diversity of skills, and while not all will lead to permanent board fixtures, it’s clear many will stay connected to the organisation.
Makrakis is deeply committed to Good Cycles and its programs. She uses the pronoun “we” when she discusses the organisation and she’s recently stepped in as their interim chair.
“It’s something I’m not sure I would have taken on without the backing of the Board Observership Program,” she says.
Facing an unpredictable pandemic, Hoernel says she was there at the right time for Good Cycles.
“Lucinda’s been able to spend the time and work to help the organisation during what’s been a really critical period, just to have those conversations and be there for me as CEO and to communicate strongly to the board,” he says.
When she finishes as interim chair, Makrakis will return to being a board director.
“Lucinda is great to work with. I think having someone with her skills is unquestionably an asset for the organisation,” Hoernel says.
To find out more about the Westpac Foundation Board Observership Program visit Westpac Foundation’s website.