A review of the effectiveness of Whitehall non-executive directors has called on permanent secretaries to prioritise appointing civil service high flyers to department boards in order to “engage the interest of the secretary of state”.
A major study of non-executive board members in Whitehall, undertaken by the Constitution Unit from University College London, reviewed the effectiveness of the roles since the since the positions were strengthened as part of departmental boards chaired by secretaries of state under the coalition government in 2010. It found the non-execs appointed since were of high calibre and had expertise that was greatly valued by the civil service. However, its interviews with 29 non-executive board members also revealed some found the role frustrating, and that it could be more effective.
The Critical friends? The role of non-executives on Whitehall boards report stated contributions had been made by non-execs in areas such as departmental talent management, procurement, and digital delivery. They had also helped with coaching and mentoring in departments, and advising on major projects.
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According to the report, whose interviewees included 11 lead non-executives and 11 departmental permanent secretaries, the advisory role of non-execs has been appreciated by senior officials. “They particularly value the discipline and experience they bring to chairing the audit and risk committee,” the report stated.
However, non-execs themselves expressed less satisfaction with the central part of their role, as board members, and study leader Professor Robert Hazell, said few Whitehall boards were said to be working well.
Departmental boards have no legal status and are a victim of what the report called “structural deference”, with the key to successfully including boards in departmental decision-making being ministerial engagement.
“Ministers who take the board seriously can make it work; but it takes time, regularity, and commitment,” the review concluded. “And it requires the board to focus on core governance issues: strategy, resourcing, capability, delivery, and risk.”
Among the report recommendations, perm secs are urged to “appoint high fliers as board secretaries, to liven up meetings, and engage the interest of ministers”.
There are also recommendations for departmental chiefs to agree with each secretary of state how the board will be used, explaining the key elements of the corporate governance code for central government departments and ensure there is a formal and rigorous annual evaluation of board performance.
Since 2015, single departmental plans have been the key vehicle to achieve strategic clarity for the department’s work and ensure that realistic plans are matched to resources, according to Hazell. Although he said that the plans had improved in their most recent iterations, “too many still consist of long lists of projects stapled together”. He added that non-execs were failing if they did not challenge what he called the unreality of many departmental plans.
“NEDs must be consulted on the single departmental plans. But there is still reluctance to challenge ministers’ wish to do everything, with consequential risks of overstretch,” he said.
“NEDs’ role could interlock more with the permanent secretary’s duty as accounting officer to seek ministerial directions before proceeding with programmes which are not feasible, or offer poor value for money.”
Given the risk of departmental overload, Hazell also recommended that non-execs use their powers “of persuasion, and publicity” to provide oversight and scrutiny.
“Non-executives do the civil service and themselves no favours if they remain silent about the immense challenges facing Whitehall, especially in connection with Brexit,” he added.
The Constitution Unit found that there was no single model of an effective board in Whitehall. The Ministry of Defence board meets monthly, and operates much like a good private sector board, while the non-execs on the board at the Department for Business, Energy and Industrial Strategy “make challenge a reality” and work to assess and record their impact, it said.
It also said there were effective boards at the Department for Transport and the Department for International Trade.