This is the final post in a series about organizational monitoring. Please read the previous two posts before reading this entry.

One of the benefits of Policy Governance is an organizational monitoring process that provides an organized, thorough assessment of organizational compliance to board policies. Here is the proof that the organization you govern has stayed on the playing field you have defined! Let me explain how it works...Over the course of one year, Policy Governance boards receive internal monitoring reports from the CEO on all of the Executive Limitation and Ends Policies. Compiled, these monitoring reports provide the board with a comprehensive assessment of the organization and form the basis of the CEO’s performance review. What is the board’s responsibility when reviewing these reports?

The board must not tolerate interpretations that:

1) Simply repeat the board’s words or default to simple dictionary-like definitions.

2) Don’t address every aspect of the policy.

3) Describe what the organization will do rather than what the policy means.

4) include justifications that are less than rigorous; “trust me” isn’t good enough.

5) Fail to outline aggressive yet reasonable methods of measuring compliance.

Sufficient evidence (sometimes referred to as “data”) in whatever form necessary must be provided to convince the Board the organization is in or out of compliance.  This evidence is always provided to demonstrate compliance with the CEO’s operational interpretation.

The board must not tolerate evidence that:

1) Measures wing flaps (“look how hard we’ve been working!”) rather than results.

2) Forces the board to look through mountains of information in search of evidence of compliance. Equally unhelpful are raw data rather than more convincing ratios, proportions, percentages, trends, etc.” Context is critical!

3) Is based on trust statements...“I think/believe…” and “We didn’t…”

4) Is incomplete.

Therefore when you are reading the monitoring report:

Assess the Interpretation for comprehensiveness/completeness. Start your assessment at the “bottom” and work up! The CEO will often refer to subsequent provisions when providing monitoring information for the Global policy statement. By reading the report from the bottom up, you position yourself as a more critical, engaged reader able to spot weaknesses or gaps in information. You might find it helpful to parse the original policy into its phrases or concepts. Have all the concepts (words or phrases) been addressed by the interpretation? Were they interpreted to a sufficient depth and thoroughness to allow the board to assess their reasonableness?

Assess the Evidence to determine if it is sufficiently convincing to satisfactorily demonstrate compliance.  Evidence should be clear, concise, and compelling. Objective data trumps subjective opinions. Just as with the interpretation section, if you have clarifying questions, e-mail the CEO and he/she will quickly send a reply to all     board members.

Finally, assess management’s conclusion concerning compliance. If management reports an out of compliance situation, management will explain how and when it plans to bring the organization into compliance. If the board is satisfied with the plan, it is noted in the minutes and determines how soon it wants to hear a progress towards compliance report from management. If a monitoring report is submitted as being in compliance, it is not necessary to have any conversation at the board’s meeting save for voting to accept the report.

One of the biggest shifts boards experience when moving to Policy Governance is that the meetings will no longer be built around hearing (and discussing) long reports from staff. This means that members who have not thoroughly prepared for the meeting can’t bluff their way through a meeting by relying on verbal reports and discussions in the board room to get caught up to speed. Add to this that I strongly encourage Policy Governance boards to take a roll call asking each member if they have received AND READ their packet of monitoring reports as a means of demonstrating their governance commitment! Just as we demand accountability from management, the board must demonstrate accountability of its own performance.