Governance is the system by which organisations are directed and managed. It influences how the objectives of the organisation are set and achieved, spells out the rules and procedures for making organisational decisions and determines the means of optimising and monitoring performance, including how risk is monitored and assessed.
The ASC recognises that effective sports governance requires leadership, integrity and good judgment. Additionally, effective governance will ensure more effective decision making, with the organisation demonstrating transparency, accountability and responsibility in the activities undertaken and resources expended.
It is commonly accepted that governance structures have a significant impact on the performance of sporting organisations. Poor governance has a variety of causes, including director/committee inexperience, conflicts of interest, failure to manage risk, inadequate or inappropriate financial controls, and generally poor internal business systems and reporting. Ineffective governance practices not only impact on the sport where they are present, but also undermine confidence in the Australian sports industry as a whole.
Governance concerns three key issues:
- how an organisation develops strategic goals and direction
- how the board/committee of an organisation monitors the performance of the organisation to ensure it achieves these strategic goals, has effective systems in place and complies with its legal and regulatory obligations
- ensuring that the board/committee acts in the best interests of the members
The Sports Governance Principles of Best Practice advocate strengthening structures that support good leadership and decision-making, and ensure sound and effective governance.
In keeping with best practice in Australian corporate governance, the below resource, available for download, contains guidelines within which the ASC believes a sporting organisation’s board members should operate and enact their role. The resource takes the form of six major principles:
> Principle 1: Board composition, roles and powers
> Principle 2: Board processes
> Principle 3: Governance systems
> Principle 4: Board reporting and performance
> Principle 5: Stakeholder relationship and reporting
> Principle 6: Ethical and responsible decision-making.
The full resource can be downloaded in the related downloads section below.
Mandatory Sports Governance Principles
In its new High Performance Strategy released in November 2012 (Australia’s Winning Edge), the Australian Sports Commission (ASC) noted that there was a compelling case for change in Australian sport. A key area of focus highlighted was governance — the time is now here to raise the bar, recognising that organisations that are managing public investment and member interests must have structures in place that reflect a greater level of professionalism. This is true whether a national sporting organisation (NSO) is focused on high performance or participation. Good governance is a necessary condition for success.
For more information view the Mandatory Sports Governance Principles