ACCA (Association of Chartered Certified Accountants) has published findings of a three-year research project into NHS governance, developed in collaboration with the Department of Health.
The report, "Understanding governance in the NHS", collates the opinions of chairs, chief executives and finance directors of NHS organisations and relevant non-departmental public bodies collected from 2007-09.
It identifies current understandings of governance in the NHS, and gauges the success of initiatives to improve it.
“The financial crisis has already hit the private sector, and will be significantly affecting NHS spending in the very near future,” says Julia Rudrum, assistant director of assurance, NHS Brighton and Hove, and ACCA Corporate Governance & Risk Management Committee member.
“All organisations need to be ready for the challenges ahead, and good governance is critical to this.”
While the research clearly shows that NHS board members recognise the need for good governance and take their responsibilities seriously, it nonetheless uncovers several shortcomings in current NHS governance arrangements.
In particular, the report highlights the ‘perception gap’ which exists between respondents’ views of the effectiveness of governance arrangements in their respective organisations, and evidence from external assessments. For example, though a majority believed that their arrangements were sufficient to comply with the Department of Health’s Core Standards for Better Health, over one third of organisations were not fully compliant.
Julia Rudrum says: “In the NHS as elsewhere, ACCA believes that capturing the ‘hearts and minds’ of board members is preferable to a compliance approach. Whilst responses indicated the level of guidance was about right, there was still a certain level of confusion about what good governance is. We see The Healthy NHS Board guide, which was published as the survey was concluded, as a step towards the consolidated, principles-based approach we have recommended.”
The report also reveals that non-executive directors (NEDs) are widely considered as central to establishing effective corporate governance practices within NHS organisations, offering constructive challenge to the board.
“While two thirds of respondents indicated NEDs have insufficient time to fulfil their increasingly challenging role, the perception that they lack the requisite financial and business knowledge decreased over the course of the project.
“This is encouraging, because as new challenges arise as a result of the wider economic situation, the application of good governance becomes even more important,” concludes Julia Rudrum.