Succession planning

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This page was authored by:

Michael Cawthorn
Consultant anthropologist

Succession planning simply means to have a plan in place to ensure that when a person leaves an organisation, that there are people identified and ready to take their place. it also involves deciding when new or different skills may be needed and identifying people who meet these requirements. Director succession planning is an important but often neglected element of good governance.

It is important for the health of all organisations that boards are periodically reviewed to ensure that directors’ skills and experience fit with the strategic direction of the organisation and external environment. Succession planning enables boards to bring fresh expertise and leadership into an organisation and ensure that when directors leave, their knowledge is not also lost to the organisation.

Having a succession plan in place allows boards to respond to economic or political changes and appoint new directors quickly in an organised way. Succession planning requires a focus on long term planning. Thinking ahead and training younger people to take on leadership roles within the organisation and community in the future is an important part of this process.

Two-way leadership and succession

Aboriginal and Torres Strait Islander societies have their own distinct systems, roles and processes for successful governance that were in place prior to British sovereignty. This includes processes for training future leaders by passing on knowledge and experience. Indigenous leaders of PBCs need particular skills to govern well in both Indigenous and non-Indigenous domains. Effective succession planning needs to take into account both cultural and corporate leadership skills. This has been referred to as ‘two-way’ governance, meaning to govern well using both Indigenous and western knowledge. Elders have an important role in succession planning and many well-functioning Aboriginal organisations have an Elders Council that advises the board (for useful resourses: Forum for Directors of Indigenous Organisations).

Succession planning and your PBC

It is considered best practice for PBCs to have a succession plan in place to deal with unexpected departures from the board, and to make sure that future leaders have the skills and experience to take on governance responsibilities in an organised way when current directors step down. 

It is recommended that PBCs have systems in place to manage this process. This may involve developing a succession planning document that identifies people with the experience or potential to be future directors, and where necessary, providing them with opportunities to develop their corporate and cultural governance skills.  The Indigenous Governance Toolkit provides guidance on strategies for succession planning:

Task

Some questions to ask

Example

What can we do

Invest in young people 

How has our governance set up our organisation for our successors? 

A trust employs young people as trainees and develops their skills in various ways, including through mentoring by Elders and connecting them with their culture. Their human resources governance committee has a program for succession planning that involves developing members’ skills until they are able to assume senior roles within the organisation. Another association investing in its youth has a youth education fund that assists students who wish to further their education (secondary and/or tertiary) away from the community. 

 

Develop your younger members’ skills 

How are we preparing our young people for larger roles in our governance later in life? 

An organisation has established an Indigenous youth council, which helps young people develop leadership and role model qualities, and gives them the opportunity to attend training, workshops, forums and conferences. Members develop skills through organising community events, representing the Aboriginal and Torres Strait Islander youth, and attending training camps. 

 

Let younger members learn from older members 

What do our governance’s older members have to offer our younger members? 

An organisation believes developing the careers of young artists is an essential part of its strategy to sustain and self-fund its arts centre. Younger artists travel with senior artists to exhibition openings in capital cities, giving them insight into the art industry and confidence to speak about their paintings and the corporation. 

 

Encourage young women in governance 

What can we do to improve the representation of young women in our governance? 

Another corporation runs a young women’s leadership program that assists and mentors young Aboriginal and Torres Strait Islander women in the community to help them reach their full potential. 

 

As all PBCs have their own aims and aspirations, succession planning is not a ‘one size fits all’ process. Directors will need to consider the aims and objectives of their PBC, and the skills and leadership qualities of directors they will require PBC require in the future to achieve these aims. The financial and human resources required to identify and develop future leaders should also be considered. Depending on the size of a PBC, there may be other key positions, such as the CEO, that should also be considered in the succession planning process. External advice from independent directors or facilitators can assist with succession planning.

Induction

It is important that there is a process in place to prepare new directors for their role and responsibilities on a PBC board. This process is often termed ‘induction’, and it enables new directors to quickly and clearly understand their role and responsibilities, and the PBC’s business and activities. Mentoring by an experienced board member is an efficient way for new directors to learn quickly and develop confidence.

While it is usually the board and senior management who are responsible for inducting new directors, there is no set process and this will be different for each PBC depending on size and complexity. However, there are certain important steps that all PBCs can consider. Directors should be familiarised with the PBC, its business and operational environment. This should include a tour of the PBC office; meetings with the board Chair and CEO; and training on their role and responsibilities to their members and common law native title holders and their duties under the NTA, PBC Regulations and the CATSI Act (ORIC's factsheets). There may be other training required relevant to the director’s role (such as financial) and this should be identified during the induction process. This is also the time when any outstanding documentation (such as appointment letters, declaration of interest forms) should be completed.

It is good practice for an organisation to prepare a new director by providing an induction pack which should include information directors require to commence their duties. The information provided may be somewhat different for each PBC. However, the basic information that should be provided to new directors includes:

  • The terms and conditions of appointment to the board;
  • Board members’ role description;
  • Information about director legal duties and liabilities;
  • PBC’s policies and procedures;
  • Specific board policies and procedures;
  • The PBC Rulebook;
  • PBC structure;
  • Most recent annual report;
  • Previous board meeting minutes (for the last six or twelve months);
  • List of all board members and contact details;
  • Details of board subcommittees;
  • Financial information (such as financial statements and audit reports); and
  • Risk assessment information (including the PBC risk register).

Some resources on induction processes and developing induction packs for new directors can be found here:

Last modified: 
1 Jun, 2018