Board effectiveness – size and capacity
Building effective boards
Here we discuss the appropriate size for effective boards and the concept of capacity, which leads to an important discussion around diversity, social inclusion and performance. But first, let’s clarify the difference between effectiveness and efficiency. These are not the same thing, and your board should be seeking to do both.
- Effectiveness is about achieving your objectives.
- Efficiency is about the resources used – time, people, financial – to achieve those objectives.
Your board may be effective, but not efficient and your board may be very efficient but NOT effective – not achieving their goals, mission or purpose. You should be seeking to be both effective and efficient. To do that, we need to understand the importance of size and capacity of our board.
Many elements make up an effective board, and research shows that size is one determining factor. The size of the board will certainly affect how you communicate, interact, and the length of time it takes to make decisions or complete the required work of the board. It can also determine the breadth of skills and knowledge available. Boards that are too small can be limited in capacity or ability and so struggle to meet their goals effectively. Boards that are too large cannot make decisions efficiently and often have problems in communication due to the time required to ensure everyone has a voice and can contribute their perspective. So, for efficiency and effectiveness, a moderate-sized board is always best. The most effective boards are between 10-12 people. The Code for Sports Governance states:
The size of a Board shall not exceed twelve persons unless agreed with UK Sport / Sport England. (Requirement 1.9)
The Code does not specify a minimum board size and this will certainly be determined in many cases by an organisation's circumstances. The Charity Governance Code, however, considers boards of between five and twelve to be good practice (5.6.2).
Monitor board size carefully, it can appear that more people on the board to share the workload is better, but as with all organisations, this increase can lead to problems with slow decision making, conflict and inefficiency. This, in turn, can have an impact on your effectiveness to meet goals. This is true for small clubs, right up to medium and large governing bodies. An increase in board size is an increase in complexity which requires further management, resources and possibly a change in structure to facilitate communication.