Feature / Building on success

Following a review of the association’s governance, HFMA chief executive Mark Knight explains the thinking behind proposed changes that will be discussed at the AGM

In 2005/06 the HFMA undertook a fundamental review of its governance. This led to the current board structure and the incorporation of the association.  It was a major piece of work in which every member had to actively rejoin the association. The new governance structure, built around 14 trustees, has worked well and the past two years have been very successful in terms of financial performance and branch development, member support and influence.

The new proposals – due to be considered at the AGM in December – seek to build on this success and reinforce the HFMA’s governance.  The group is currently made up of the HFMA, subsidiary trading arm HFMA Ltd and commercial trading vehicle HCS Ltd, and it has a combined turnover of more than £4m (2008/09). Turnover is expected to grow modestly over the next few years. Any surpluses will be channelled back into the HFMA’s services and will improve the long-term outlook for the association.


Trustee term extension

The board has tasked me with looking at how the rules have operated over the past few years.  One of the key jobs in this mini-review was to look at the role of the trustee in the HFMA. We have struggled with ‘trustee churn’ over the past three years. Under current rules, trustees can only serve a maximum of four years made up of two terms. But much time and effort goes into recruiting new trustees and the association wants a stable and experienced board to reflect the changing needs of the NHS. 

The proposal is that a trustee term is extended from two to three years, which will give trustees long enough to get acquainted with the issues. A three-terms (or nine-year) rule would then be imposed so that the board would be regularly refreshed and exposed to new talent and ideas. Nine years would be the maximum time spent as a trustee.

Time served in chief officer positions (currently chairman, vice chairman and treasurer or the proposed vice-president and president positions) would be included in these nine-years.  So a trustee could not serve nine years on the board of trustees and then be appointed in a leading role as this would break the nine-year rule. The only exception would be where a trustee became chairman/president in their ninth year on the board; then, the rule would be flexed to enable the immediate past chairman/president to remain on the board.

The maximum nine years would not necessarily have to be served in one long block of three consecutive terms. The three-year terms would also be a maximum, enabling the preference among devolved nations to change their nominated trustees every two years to be accommodated.  In addition, the new rules will allow trustees the ability to take a sabbatical in a similar way to a career break.

President returns

Another issue recognised in the proposed rule changes is the title of the most senior officer within the association. Between 1950 and 1963, the HFMA had an honorary chairman and this was changed to president in 1963. The president title was retained until 1975. 

Following the merger with CIPFA, however, the association reverted back to chairman, partly in recognition of CIPFA having its own president’s position. It is proposed that the association use its 60th anniversary (2010) to reintroduce the title of HFMA president.

It is felt that this more appropriately reflects the honorary role of the association’s senior officer, bringing us in line with our colleague professional associations in accountancy and the health-based royal colleges. It will also add clarity within the association – the HFMA has more than 25 chairs across its 13 branches and numerous committees, faculties and special interest groups.

As a consequence of this title change, the chairman-elect would become vice president. However, it is proposed that a second vice president position be created. Vice presidents would serve a two-year term before having their name put forward to the AGM to be considered for the presidency. Both vice presidents would be nominated through the branch network in the usual way and their appointment ratified at the AGM.

This will improve the association’s succession planning, and help spread the workload facing the association’s most senior officer in his/her year in office – and some president duties shared by the vice presidents. 

Board sub-committees

The board envisages the newly appointed vice presidents taking on key roles. It has decided to create two new sub-committees to help develop key strategies.

An Education, Training and Member Services Committee will help the executives develop the association’s growing work in this area, analyse event feedback, ensure content meets the priorities of members, seize opportunities and develop new initiatives.  It will also focus on members and, as part of the new strategy on ‘benefit’, ensure the HFMA is providing services to its target audiences.  It is anticipated this committee will be chaired by the same vice president over a two-year period.

An HFMA Ltd/HCS Ltd Advisory Board would also be set up. It would meet regularly to advise the trustees on commercial issues and help to provide a steer on these matters. The Advisory Board will report to the HFMA Board, but it will include trustees and be chaired by a vice president. The Advisory Board will be different from all the other committees as it is expected the HFMA will appoint several non-executive directors to help advise on commercial strategy and provide valuable contacts and experience.  Adverts for these posts will appear in the new year.

Although both these sub-committees will be made up of trustees, the association is looking for keen volunteers who would be committed members of the association with expertise in either of these areas. If you are interested, do

e-mail me, stating whether you are interested in the education or commercial aspects.

Appointments body

The way the association is governed is very important and the final substantive change involves the creation of an Appointments and Remuneration Committee. People often ask how the association chooses its leaders – not only the chairman, but also chairs of different committees. This new committee will seek to provide greater structure to this process and improved transparency. It will be made up of the officer trustees, but will canvass views more widely on the suitability of candidates and adopt a more structured approach.

The committee will also advise me on senior staff remuneration and assist with key appointments. We hope this change will enable us to further strengthen our governance and ensure we remain an effective organisation.

A couple more minor rule changes are also being proposed. These concern powers the trustees have to offer block memberships to organisations and to strike off non-payers of the subscription after three months rather than the current six months. A full paper will be available when the AGM papers are published.

At its latest meeting, the Board discussed the membership subscription.  It was agreed that at least for 2010/11 it would recommend a freeze to all levels of subscription. It is important we continue to provide value for money with this magazine and the other services provided.

We are keen to hear what you think about these changes as we approach the AGM, so do not hesitate to contact me at any time. n

Mark Knight can be contacted by email at [email protected]