Bricks and Blocks from Steve Rhode's flickr photostream
There are some great boards governing arts organisations in the UK. Engaged, expert, connected to their communities, robust and committed, the directors do it for love and from a sense of civic responsibility. Its certainly not for financial gain, as the members of boards of charities are in the main unpaid, and its rarely for recognition, with only the chairs of top (drawer) arts organisations regularly receiving honours. But for all the successes, most of the discussion about governance in the arts world is critical. Individual executives complain about lack of support and understanding from board members and the governance of subsidised arts organisations is a vexed area. Much of this is due to the widespread adoption of a standard, bespoke model for arts governance , created several decades ago as mechanisms whereby organisations could comply with fiduciary and legal requirements, avoid corporation tax and receive arts council and other funding.
But one size does not fit all. All the focus on the weaknesses of the current system tends to ignore not only the examples where the present model is absolutely fit for purpose, but also diverse altnerative governance structures which exist in the arts. Peers in the MMM Revolution programme coming together to discuss governance at Newcastle’s Live Theatre were variously involved in shareholding companies, or in Community Interest Companies as well as the standard model. In an arts ecology where collaboration and distributed leadership have taken firm root and where new financing, practice, resources and community relationships are emerging, its time to take a closer look at governance. In particular, its time to recognise that in a diverse ecology, there are several valid species of arts governance models which will best suit diverse artistic enterprises.
The test needs to be, what is the best governance structure and system in each case to support artistic and organisational mission and to be truly accountable to beneficiaries? The consideration of beneficiaries is key. In a subsidised arts organisation receiving public money, the beneficiaries will include the general public and artists. But can the current prevalent governance systems in the subsidised arts support effective accountability to the public and artists ?
There are many types of structures and organisations in the arts, from those with tight and clear links with government to those where there is little relationship with public funding agencies. At each end of the spectrum , there is relative clarity about accountability. A national gallery or one of Scotland’s national performing companies, for example, is directly accountable to government with directions and targets to meet. A small community arts organisation with a mixed economy, volunteers and strong community interaction, will be very visible in its community and focussed on delivering benefits for its public. Its the large number of arts council and subsidised organisations in the middle where there is less clarity.
The standard model of a subsidised arts organisation in the UK looks something like this. Constituted as charity, the boards will typically include as directors members of the public with skills and expertise in arts, community, management, marketing, fundraising, financial, legal and other specific skills. They may also include specific representatives of their local authority and of key user groups like amateur societies. The governing documents for boards will enshrine both charitable objectives and powers as well as operating rules. Boards will do their best to govern with care, dligence and skill, providing support and challenge for executives, hiring and firing, advocating, and balancing compliance and risk.
But unlike shareholding and membership organisations and charities, most arts organisations are governed by boards whose members do not directly or wholly represent shareholders or members. The board directors may be openly recruited but there can be a lack of clarity about accountability. By law, most board directors are accountable only to themselves as the directors will be the only members of the company. This lack of wider accountability can serve to weaken their perceived legitimacy. While some boards regard their responsibilities as being to all stakeholders, others take a narrower view, often focussing on the highest profile twin forces of the executive leadership and the major investor – the arts council.
Questioning the current prevailing models of governance in the arts is not confined to the UK. Diane Ragsdale, speaking at the MMM Revolution event, described some of the pitfalls endemic in the US model of governance of arts organisations (give, get or get off). One danger she observed was that US boards tend to focus on preserving the existing structures rather than focussing on achieving artistic mission – a focus which in itself might mean leaving behind existing structures, like a building. Another pitfall she identified was the undue influence on artistic programmes exerted by board members who are major donors.
He who pays the piper always influences the tune. In the UK, the piper is unlikely to be a major donor but more likely to be funders representing the public interest and /or state policy, in particular the arts council and local authorities representing the public interest. But while the private donor in the US and the local authority in the UK will often be directly represented on the board, stating their claim, their priorities and sometimes their taste, the arts council will not. While some arts councils sometimes send observers to board meetings, the general policy is to leave governance to the board. Arts council board members or officers never serve as full board directors. How much clearer it would be if, within an overriding commitment to act corporately to achieve the mission of the organisation, the arts council had shares on the board representing its interest, along with other shareholders like local authorities, commercial operators, user groups and so on.
Governance structures which include arts councils as shareholders? Creative Community Companies? Operating without a board at all? Its time to unblock the one size fits all model and legitmise alternatives more fit for purpose.