Annual Report and Accounts 2012/13 - Royal Devon & Exeter Hospital

108 5. Our Governors and Members
Royal Devon and Exeter NHS Foundation Trust
Annual Report and Accounts 2012/13
The role of
Governors following
the Health & Social
Care Act 2012
The 2012 Act confirmed that the
Council of Governors has a duty to hold
the Non-Executive Directors, individually
and collectively, to account for the
performance of the Board of Directors.
It also has the duty to represent the
interests of the Members and the
public. Additional rights and powers,
including approving any application to
enter into a merger or acquisition and
the approval of any proposed increase
in private patient income of 5% or
more in any financial year, were also
contained in the Act.
Over the course of the year the
Governors considered the statutory
powers contained within the new Act
and looked at its current practices to
see if they were compliant with it; or
whether additional modifications were
required to ensure that the clarified
powers were being enacted. This process
involved a negotiated outcome with the
Directors at a joint development day.
In agreeing an initial overview of how
the powers would be enacted, both the
Governors and Directors stressed that
any agreement would need to be subject
to regular reviews to ensure that it was
fit for purpose.
The following overview provides
the key elements of the agreement
between the Governors and Directors
about how the directions set out under
the Act would be taken forward. In
some areas, it was agreed that current
practice was sufficient; in others it
was felt that current practice needed
to be tweaked or more substantially
amended; in others, it was agreed
that a new approach needed to be
established.
Accountability for the
performance of the Board
Holding the Non-Executive Directors,
individually and collectively, to account
for the performance of the Board of
Directors is a new statutory duty for
the Council of Governors.
Although the 2006 Act does not
directly refer to accountability between
the CoG and Board, the current
Monitor Code of Governance (pre
2012 Act) interprets this element of
the role of the CoG to be:
“The Board of Governors should hold
the Board of Directors to account for
the performance of the Trust, including
ensuring the Board of Directors acts
so that the Foundation Trust does not
breach the terms of its authorisation.”
The main differences are:
• The establishment of a statutory
duty for Governors rather
than advice. This suggests that
Governors must now legally fulfil
this duty
• The CoG exercises its
accountability duty in relation to
individual NEDs and the wider
Board. The NEDs must account to
the CoG for the performance of
the Board
• The accountability is focused on
the performance of the Board
rather than the performance of
the Trust.
The Act clarifies that the accountability
relationship concerns the performance
of the Board in carrying out its duties
rather than the performance of the
Trust as a whole.
This will help to avoid, though not
eradicate, the idea that Governors
oversee the performance of the Trust
in the way that Directors are legally
obliged to do.
This is, as mentioned earlier, consistent
with the work that Governors have
been involved with at the Trust over
a number of years in better defining
their role.