HCA puts spotlight on long-standing board member issues
In a “too little too late” statement Matthew Harrison, chief executive of Great Places Housing Group said ‘It is good practice to have board renewal, it is about ensuring the board is able to appropriately challenge the executive and do its job properly rather than board members becoming part of the furniture’
Well he should know as the board of Great Places recently aproved a payment to Mr Harrison’s predecessor Stephen Porter of £449,000 upon his voluntary retirement.
After this trouser bulging payment the sector’s reputation is in jeopardy.
Ex chief executive Mr Porter is following a well-trodden lucrative gravy train: Bill Payne (ex chief executive of Metropolitan) received £412,000 when he left his post in 2011; and Alan Walker (ex chief executive of A2 Housing Group) received a £648,000 when he departed in 2007.
So how did this come about? The housing regulator (HCA) pointed to a lack of challenge from the board ‘compounded by close working relationships… formed as a result of the long service of a number of board members’. Julian Ashby, chair of the HCA’s regulation committee said ‘The problem is even worse when there is a combination of long-standing board members and long-standing executives’.
David Orr, chief executive of the National Housing Federation, urged boards to look at their code of governance to avoid similar situations.
The regulator is taking a firm approach to avoid a debacle like the Great Places pay-off happening again, housing associations will now come under pressure from both the HCA and the the National Housing Federation to ensure board members do not serve for long periods.
So how is Eastend Homes Ltd board shaping up to the recomendation that members should not serve more than 9 years? Something does appear to be happening at the top. On the day of the “Residents Open Day”, the appointments of Motin Uz-Zaman and Desmond Ellerbeck were terminated. Motin Uz-Zaman (a local councillor) has been on the board since 2004. So that leaves four further board members who should therefore be making a graceful exit at the next AGM this September:
- Tom Madden – appointed 20/09/2004
- Mary Nepstad – appointed 7/12/2004
- Bernie Cameron – appointed 7/12/2004
- Martin Young – appointed 7/12/2004
- Motin Uz Zaman – appointed 7/12/2004 – already terminated on 29/8/2013
….and next year Directors appointed in 2005 would have to stand down – ie
- Neil MCaree – appointed 10/03/2005
- Lesley Johnson – appointed 10/03/2005
So can we look forward to a board member recruitment drive? A reboot at the top?