The challenge of good governance in large membership-base organisations

I don't write much about my role as a Director of Parramatta Leagues Club, where I'm also Chair of the Community committee. However, both roles give me enormous satisfaction and enjoyment and I'm so thankful for the experiences and joy they've provided me with.

I've learnt an incredible amount in the last five years about exactly how important a well-functioning board is for an organisation, and that's doubly so for a large member-based organisation like ours.

For those who don't know my back story, my journey onto the board came about after I created a Parramatta Eels supporter website that became very popular and influential. So much so that I found myself involved with the politics of the organisation, and in particular, I took up the cause of reforming the club's constitution.

Unfortunately, Parramatta was a victim of a governance structure that essentially promoted factional warfaring. Members organized themselves into tickets and, every two years at every election, spent months abusing each other (and the club itself if that fit with their political messaging).

If one group succeeded in ousting the other, they tended to sack everyone who was perceived to be "loyal" to the last group. What's more, because the Leagues Club board also managed the football club, that parent organisation never got the attention that a business of its size and complexity deserved. It shouldn't surprise that both clubs underperformed.

In 2016, things had gotten so bad that the government appointed an administrator to take control of both organisations. The administrator made immediate changes. He put in place a new constitution for the Eels that meant it was run by an independent board which afforded it protection from interference from future Leagues Club directors, who just wanted to use their elected position to control football.

Meanwhile, I was very involved with a group of members in getting a 75+ per cent vote from Leagues Club members, which introduced a raft of governance improvements, such as allowing postal/online voting and changing to a triennial voting system, which meant entire boards didn't change at a single election.

That process lasted years as members of the old factions campaigned to block reforms, but it finally passed by just two votes.

Members were then given the opportunity to apply for the new board, and I was successful in joining six other members to form the first board afforded the opportunity to focus on the Leagues Club business following the structural separation.

The improvements were immediate. The Eels had not made finals once during the years of those tumultuous factional wars but made finals in five of the following six years. Since the Leagues Club board was reconstituted we have achieved record membership, strong financial performance and grown the number of clubs that are part of our group.

My primary reason for wanting to join the board was my passion for Parramatta Junior Rugby League, which is primarily funded by the Leagues Club. That's why I put my hand up to Chair the Community Committee. Last year, we gave a record figure to junior Rugby League and grassroots sports and spent significantly more than we were obliged to, supporting all of the amazing charitable causes we help to fund.

Next year, our organisation will become a $100 million business, and we're working towards a generational property project that will guarantee the future of both clubs for generations to come. In case you can't tell, I'm really, really proud of what our Leagues Club board has achieved and what our future is going to look like.

Parramatta Leagues, however, has had an advantage that very few membership-based organisations ever get. Our board was selected the same way a corporation's board is chosen. There was an application process, directors were picked on merit for their skills, but more so, based on the collective skillbase.

On our board we have a CFO, a former Assistant Police Commissioner, a marketing communications leader with extensive Not-for-Profit board experience, a Chief Risk Officer, a former Parramatta Council CEO and our Chair is a former successful business executive, who has also been very active in grassroots sports administration. I bring my technology and media experience, as well as a decade's involvement with Junior Footy, and between us, there are few issues that crop up in the boardroom where we can't lean on someone's expertise and experience.

It would be nigh impossible to get that cross-section of skills where boards come together based on the vagaries of an election.

However, we also have disadvantages. We have 65,000 Leagues Club members. That comes with challenges when it comes to agility. I've talked previously about how important a constitution is, and all constitutions should continually evolve to be fit for purpose.

Because of our membership base, it costs hundreds of thousands of dollars for our club to hold an extraordinary general meeting to change any part of our constitution. That's money you can't put into your core purpose like supporting footy or investing in membership facilities, so you have to be circumspect and thoughtful in how you evolve your constitution and governance structures.

You also have to hope your membership cares enough to vote and participate when you want to make changes or protect those foundations.

After all those years of campaigning for the reforms we achieved, I can say that most members' eyes glaze over at the very mention of words like 'constitution' or 'governance'. However those structures are the foundation of any potential success, so you've got to do your best to keep members engaged and educated on these issues. In a complicated governance structure like we have at Parramatta, that's easier said than done. Indeed, it's something I think we can, and must, do better with.

One of the key elements that has been built into the constitution of both our clubs, which I can't speak highly enough of, is maximum tenure. It ensures continual board refreshment, bringing in opportunities for new ideas and skills. For instance, by some point next year, all of the independent directors, including the Chairman of the Parramatta Eels board, will have turned over. It means they can bring in new skills and experiences as needed which is so critical because all organisations and the environment that they operate in, change constantly. Importantly, it also limits motivation for boards to indulge in "empire building". The last thing you want from directors is for them to make decisions because they care more about their own tenure or their own egos than doing what's best for the club.

Sometimes, I hear boards and organisations talk about the need for stability. I don't think that's the right objective. What you're trying to achieve is order. You have to invest in succession planning, and if you're a member organization, you've got to be serious about having fair and accessible elections and member participation. Gradual change shouldn't be feared, but damaging disruption should be.

From our history and experience, we know full well that continual chaos will only result in turmoil and failure. But when you get your constitution in order and invest in evolving your governance structures and board in a structured and iterative way, you're well on your way to sustainable success. You'll never win all the time, but those foundations let you bounce back when things don't go as planned because you can make thoughtful, considered changes rather than reactive panic, which is a hallmark of any organisation seeking continuous improvement and growth.

(And if our Eels directors or management are reading, we'll take a Premiership too, please).