Review of the Registered Clubs Industry in NSW - Clubs NSW

9 Improving corporate governance
IPART considers that the above approaches are likely to be useful in helping to
overcome the challenge of attracting people, particularly those with appropriate
skills, to club boards. Therefore, it considers that club boards should be encouraged
to have in place a formal succession policy. This policy should set out how the board
intends to renew itself over time, to achieve a balance between keeping existing
expertise and bringing in new ideas and skills. In addition, clubs should be
encouraged to use casual board vacancies and committees to recruit and train future
directors.
To encourage succession planning, ClubsNSW should amend its Best Practice
Guideline for Board Operations to include a best practice recommendation on this
issue, consistent with Recommendation 50. IPART considers that this best practice
recommendation should emphasise the need for succession planning to be an open
and transparent process. Such an approach should be consistent with the current
tone of the Best Practice Guideline, which encourages boards to ensure that their
make-up is representative of a club’s membership. 163 Clubs that do not comply with
the best practice recommendation should be required under a revised Code of
Practice to disclose their reasons for non-compliance in their annual report (also see
Recommendation 50).
In addition, ClubsNSW should amend its Best Practice Guideline for Board
Operations to encourage clubs to view casual board vacancies and committees as
opportunities to attract and train people with appropriate skills for future board
positions.
Recommendations
44 That ClubsNSW encourage club boards to prepare a formal succession policy that sets
out how they intend to renew their membership over time, to achieve a balance
between keeping existing expertise and bringing in new ideas and skills, by revising its
Best Practice Guideline for Board Operations and including a best practice
recommendation on succession planning.
45 That ClubsNSW encourage clubs to better utilise the opportunities created by casual
board vacancies and committees to attract and train people with appropriate skills for
future board positions by revising its Best Practice Guideline for Board Operations.
Some stakeholders also suggested that remuneration could be used to attract
appropriate people to directors’ roles, but this option did not receive wide support
among stakeholders. IPART is similarly wary of clubs remunerating only some of
their directors. It considers it would lead to disharmony between remunerated and
non-remunerated directors.
163 For example, the Guideline notes that clubs that have a large number of women as members should
actively encourage appropriately qualified women to seek directorships: ClubsNSW, Best Practice
Guidelines: Guideline for Board Operation, July 2005, p 26.
Review of the Registered Clubs Industry in NSW IPART 155