Carver Model of Policy Governance

Introduction

Nonprofits and registered charities, like other incorporated entities, are required to have a Board of Directors to perform governance and oversight. Boards review the financial situation of the organization, write policies and perform risk management, among other duties.

There are a number of theories on the most effective form of Board Governance. Boards are generally separated into 3 types, with some overlap:

• Working Board: This is a Board that participates heavily in the day-to-day operations of the organization. This might be the case at a very small or very new organization where a “Steering Committee” who helped build the organization moves into the role of the Board
• Hybrid Board: This is a Board that performs some operational work (such as writing grants) but ideally spends the majority of their time performing governance and policy tasks
• Policy (or Governance) Board: A Policy Board or a Governance Board is one that spends no time performing operational duties and strictly works on Governance and Policy

There are pros and cons to each approach, but most large organizations have Policy Boards to ensure that the operational tasks are appropriately handled by the paid staff, while the Board acts as the stewards of the organization. One model of policy governance (arguably the model that popularized policy governance) is nicknamed the Carver Model, after its creator John Carver.

The Policy Governance Model is a registered trademark of John Carver, all rights reserved.

John Carver

John Carver earned a Bachelor’s degree in Business and Economics, a Masters in Educational Psychology and a PhD in Clinical Psychology from Emory University in 1968. (Carver, 2006) He has published five books and 13 monographs and authored over 200 journal articles. (Policy Governance Model, 2016)

10 Principles of Policy Governance

The ten principles of policy governance are as follows (BoardWorks, 2005):

1. The Trust in Trusteeship. This means the Board should be a steward or trustee of the organization – not just financially or for those who have a legal stake in the organization but all stakeholders, including clients or others to whom the Board has a moral responsibility to.
2. The Board speaks with ‘one voice’ or not at all. A Board should never be fragmented. Reaching a collective decision ensures that the Board will be able to carry out their mission effectively and consistently. A single voice provides true leadership and avoids politics.
3. Board Decisions should predominantly be policy decisions. Rather than intervening in operational or day-to-day decisions, the Board should restrict itself to making decisions in the form of written policies. The Carver Model actually sets out four types of policies (Carver & Carver, 2001) that the Board should concern themselves with :
   1. Governance Process. These policies set out the actions of the Board like its responsibility to perform visioning and accountability
   2. Board-Staff Linkage. These policies govern the relationship between the Board and the Executive. Examples of these policies include how the staff are monitored by the Board and who is responsible for making what decisions (operational vs governance.)
   3. Executive Limitations. These policies set out what the executive (e.g. the Executive Director or CEO) cannot do. For instance, in some organizations the disposal of real estate may only be with the consent of the Board – this could be codified in an Executive Limitations policy
   4. Ends Policies. Ends Policies set out the goal of the organization – the reason for its existence. This may be codified in a mission or visions statement in addition to an Ends policy.
4. Boards should formulate policy by determining the broadest values before progressing to the more narrow ones. This means that policies should be developed from the broad (such as a policy statement that sets out the need for evaluation) down to the narrow (the policy surrounding the use of Key Performance Indicators.) The result is that policy flows logically from very large to very small.
5. A board should define and delegate rather than react and ratify. This principle means that the Board should create policies that delegate tasks to the CEO and then respect the delegation. If situations are covered in existing policies, when something new comes up those policies will kick into effect, rather than the Board writing new policies.
6. Ends determination is the pivotal duty of governance. The Board should always keep in mind the outcomes of the organization. Their goal should be to monitor outcomes and delegate the achievement of those outcomes to the CEO or Executive Director. The Board should remain strategic.
7. The board’s best control over staff means is to limit, not prescribe. This means that the Board should indicate (as in principle 3, Executive Limitations) what an Executive is not permitted to do. They should not be telling the Executive what they should do. This subtle difference gives the Executive Director the freedom to achieve the goals set out by the Board.
8. A board must explicitly design its own products and services. This means the Board should write their own policies rather than merely adopting policy templates that may not be relevant for their specific needs.
9. A board must forge a linkage with management that is both empowering and safe. The CEO must feel that the Board will honour its commitment to policy governance while the Board has trust in the CEO or Executive’s ability to manage. If this trust breaks down, leadership will falter.
10. Performance of the CEO must monitored rigorously, but only against policy criteria. Objective measurement criteria for the Executive is important – but this must be measured in relation to the Ends policies.

Advantages and Disadvantages of Policy Governance

Broadbent (1999) in his landmark report, Building on Strength: Improving Governance and Accountability in Canada’s Voluntary Sector (also called the Broadbent Report) reviewed the Carver Model among other elements and identified a number of advantages and disadvantages.

Strengths of the Carver Model include emphasizing the role of the Board as trustees of the organization and highlighting the importance of moral ownership, not just legal ownership. Additionally, the focus on policies and a rejection of operational decision-making avoids micromanagement of the Executive and prevents rubber-stamping of policies or decisions.

Finally, the focus on the “Ends” – the visioning and the measurement of the Executive against those outcomes rather than the methods to achieve them, produces a future-focused Board.

Disadvantages of the Carver Model include a lack of focus on operational priorities. Although the goal of the Board is to help set the strategic priorities, a Carver Board is not involved in the implementation of those policies which can lead to them becoming corrupted.

Additionally, some activities that are performed by working or hybrid boards like fundraising are not performed by a true Carver Board. This means that it may be unsuitable for some small organizations where the Board holds the responsibility for major fundraising in the organization.

Finally, because many decisions are made by the CEO rather than the Board this can lead to weakened information flow and a lack of transparency as decision are made by the CEO out of view of the Board. (Coyne, n.d.)

Conclusion

The Carver Model represents one way of governance that has become increasingly popular in Canada and the US. Implementing the Carver Model may allow you to make a more effective Board despite the potential drawbacks and criticisms that have been levied at the model.

References

BoardWorks. (2005) “Why is it that the Carver Policy Governance Principles can seem so hard to Honour?” Retrieved on June 30, 2017 from http://www.hospice.org.nz/cms_show_download.php?id=317

Carver, J. & Carver, M. (2001) Le modèle Policy Governance et les organismes sans but lucratif [The Policy Governance Model and non-profit organizations]. Gouvernance. 2(1). 30-48. Retrieved on July 2, 2017 from http://www.policygovernance.com/pg-np.htm

Carver, J. (2006). Boards that make a difference: A new design for leadership in nonprofit and public organizations. San Francisco, CA: Jossey-Bass.

Coyne, T. (n.d.) The Many Failings of the Carver Governance Model. Retrieved on July 2, 2017 from http://www.k12accountability.org/resources/Accountability-Committees/Carver_Governance_Model_Failings.pdf

Policy Governance Model. (2016). “The Policy Governance(R) Model – Publications”. Retrieved on July 2, 2017 from >http://www.policygovernance.com/pubs.htm