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A Code for Sports Governance

by Stephen on November 8th, 2016


In the UK, sporting organisations seeking public funding for sport and physical activity must meet new gold standards of governance considered to be among the most advanced in the world.

A new Code for Sports Governance sets out the levels of transparency, accountability and financial integrity that will be required from those who ask for Government and National Lottery funding from April 2017.

The Code has three tiers and will apply to any organisation seeking funding from Sport England or UK Sport, regardless of size and sector, including national governing bodies of sport, clubs, charities and local authorities.

The Code is proportionate, expecting the highest standards of good governance from organisations requesting the largest public investments, including:


  • Increased skills and diversity in decision making, with a target of at least 30 per cent gender diversity on boards;


  • Greater transparency, for example publishing more information on the structure, strategy and financial position of the organisation; and


  • Constitutional arrangements that give boards the prime role in decision making.


It will be interesting to see whether our Government grant funding agencies make use of this resource and seek to follow this development for sporting bodies and other not-for-profits seeking grant and development funding.


Principles of good governance


The UK Code has, at its heart, five principles of good governance.  Whilst there are stated to be principles (and not mandatory) they are expressed in rather emphatic language, namely:


  1. Structure: Organisations shall have a clear and appropriate governance structure, led by a Board which is collectively responsible for the long-term success of the organisation and exclusively vested with the power to lead it.  The Board shall be properly constituted, and shall operate effectively.


This is important because the right governance structure with decisions made at the right level enables the best decisions to be made to drive the success of the organisation.


Having an appropriate governance structure demonstrates to all stakeholders that the organisation is well managed.  This is key to winning the confidence of staff, suppliers and potential investors and also provides a framework for organisational growth and development.


  1. People: Organisations shall recruit and engage people with appropriate diversity, independence, skills, experience and knowledge to take effective decisions that further the organisation’s goals.


This is important because diverse, skilled and experienced decision-making bodies which contain independent voice and engage in constructive, open debate enable good decision-making.


  1. Communication: Organisations shall be transparent and accountable, engaging effectively with stakeholders and nurturing internal democracy.


This is important because being responsive to stakeholders, understanding their interests and hearing their voice helps shape the organisation’s governance and strategy.  Transparency about why the organisation exists, what it is trying to do, how it is doing it and with what results empowers stakeholders by giving them the information about the organisation that they need to know.


  1. Standards and Conduct: Organisations shall uphold high standards of integrity, and engage in regular and effective evaluation to drive continuous improvement.


This is important because having the right values embedded in the culture of the organisation helps protect public investment and also enhances the reputation of the organisation, earning stakeholder trust.  Constantly seeking to improve makes an organisation swift to respond to new challenges and opportunities.


  1. Policies and Processes: Organisations shall comply with all applicable laws and regulations, undertake responsible financial strategic planning, and have appropriate controls and risk management procedures.


This is this important because understanding the legal environment and having in place appropriate financial and other controls help mitigate risk and enhance stakeholder trust.


The three tiers


Organisations in receipt of less than £250,000 will need only to comply with the basic standards in Tier 1 whilst organisations in receipt of over £1m and where funding is granted over a period of years on a continuing basis, will need to comply with Tier 1 standards and the far more stringent standards in Tier 3.


Tier 2 is a broad sector which falls between the two and organisations within this category will be required to meet all Tier 1 standards and some Tier 3 standards.


Tier 1 standards are mandatory for all organisations seeking public funding.  They are broad and not overly prescriptive; thereby giving sports organisations discretion while offering guidance on best practice.  For example all organisations are required to have a governing committee that meets regularly.  How often this should take place is an internal matter but the Code suggests a minimum of four times annually.


Significantly higher and more prescriptive governance standards are required for organisations in Tier 3.


Concluding comments


The drafters of the Code have condensed a great deal of material into a publication that is well-written and populated with examples fleshing out why the elements of the Code are important.


Even if funding agencies in New Zealand take some time to review this material and consider whether some of the material can be right-sized for a New Zealand audience, it is worth reviewing.  Many of the key elements have been adopted by our largest sporting organisations through a combination of environmental and other factors – including assistance from Sport NZ.



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