Club Governance

Gary Hamilton, J.D.Professor The Collins College of

Hospitality ManagementCal Poly Pomona

Learning Objectives (Pre-Application)

By the conclusion of this session you should be able to understand and apply the following concepts:

Formal versus Informal Organizational Structures Club Elections: Process and Procedures The Role of the Board Board Characteristics Power, Status, and the Political Reality of Clubs Managing Member Expectations Critical Communication Concepts The Role of the General Manager Decision-making and Governance “Best Practices” in Club Governance

Club Organization

Board Information BOD/Committee Rosters Meeting Dates Expected Commitments Sample Agenda Board Orientation and Retreats

Club Organization

Organizational Chart

Elected and Voluntary Leadership Staff Organizational Chart Sample Org Chart

Organizational Structure (Informal)

Past Presidents “Regulars in the Men’s Grill” Political power brokers

Internal External

Stakeholders beyond the club Power, status, and political savvy

Club Governance: Contracts

Employee Vendor Services Employee manuals Others

Club Governance: Additional Considerations

Decision Making

Common Law Statutory provisions Affirmative Duties Breach Indemnification Ultra Vires

GM as COO

Planning Organizing Staffing Directing and

Leading Controlling

GM as COO

Ex Officio member of Board and Committees

Counsel / advisory providing expertise and

judgment consultant role

Staff Identified as “Note taker”

Board Responsibilities

Policies Governance Financial Oversight Voting on New Members

Board Responsibilities

Member Discipline Affirm Mission & Vision Orientation Communication

Board Responsibilities

Expectations Member Board General Manager

Board Responsibilities

Establishing and Enforcing Rules of Conduct and

Behavior

Board Responsibilities

Executive Committee

1. Handles “sensitive” issues2. Monitors full board3. Assess GM’s performance4. Prioritizes Issues5. Facilitates Board Productivity

Board Responsibilities

Objectives SOP’s Administration Committee Organization &

Review Delegation Authority Specialty Consultants

Board Responsibilities

Elections & Annual Meeting Odd number of members to ensure

a majority vote Well defined election process Two (3) year, staggered terms, if re-

nominated

Board Responsibilities

Elections & Annual Meeting President enjoys equal voting

privileges Presidents – (two) 2 consecutive

one year terms Past President – Ex Officio Committee Chairs to Board

Board Responsibilities

Membership Voice Financial Oversight & Audit

Board Duties and Responsibilities

The Duty of Care / Due Diligence

The Duty of Good Faith / Loyalty

The Duty of Compliance

Board Characteristics

What are the Salient / Desirable Characteristics of a Board?

Empty exercise? Luck of the draw? Farm Team Strategy? A Structured Event?

Board Selection: Some Considerations

Formal Process for Identifying Candidates

Nominating Committee Review Avoiding ‘Competitive’ Elections

Board Selection: Some Considerations

Contested Election Procedures Open Slate Slot Nomination by Petition Experience & Diversity Electing Board Officers

Board Conduct

Establishing aCode of Conduct

Board Ethics

Fiduciary Duties IdentifiedCode of EthicsConsent Form

Confidentiality Agreement(for proprietary financials)

External Regulations

Federal law IRS implications State law City ordinances Real Estate/Trust implications

Club Organization:SOP’s

History of Board Actions: 5 year timeframe Club Impact Date Adopted Policy History

Club Organization:SOP’s

Current Policies Governance/By Laws Membership Finance Operations

Board Budget Functions

Budget Philosophy initiation fees member dues special assessments

Annual Budget Process Operational Forecast by

Department

Capital Budgeting

Defined: Dollar Limitation Project Proposals

Priority Assessment Process Timing

Capital Budgeting

Recommendations Budget Approval

Contingency funds established Authorization

Finance & Budgeting

Annual Audit Process Audit Letters

Credibility enhancers

Capital Budgeting

Project Category Repair & Replacement from Capital

Dues Member Services Enhancement

from Initiation Fees

Status of Technology

Capital Investment Summary Technology Plan

Human Resources

HR Policies and Procedures Staff

hiring assignment termination grievances performance evaluations salary determinations

Human Resources

HR Policies and Procedures Benefits

Health Care Retirement Matching Perks for Seasonal Associates

Employee Manual

Human Resources:Management Control

Key components/considerations Report directly to GM Accountability Are you in charge? (see next slide!)

Human Resources

Supervisory Responsibility Tennis Pro Golf Pro Course Superintendent Controller Maintenance

By Laws

Current By Laws History of Board Actions Review Cycle New Legal Developments & Exposure

Legislative Updates

Insurance Coverage

Insurance Summaries Coverage Deductibles Exemptions Cost

Advisory letters from Carrier

Legal & Legislative

Confidentiality Litigation Internal Conflict Ramifications and Recourse

General Club Dynamics Activities Calendar Hours of Operation Club History Newsletter Web site Information Menu Overview / Access Banquet Services

Membership

Membership totals by class and variances

Detailed demographics

Membership

Membership Applications and Procedures Fees Sponsorship Membership classes Payment programs

Membership

Membership trend analysis Competitive fee analysis Regional trends Membership Satisfaction Surveys

and Results Value and Services Assessment Membership Roster

Strategic Planning

Executive Summary of Member Survey

Current Strategic Plan Facilities Report

Schedule of Assets Depreciation Schedules

Capital Investment Strategies

Board (and

Committee) Orientation

A. What is orientation? - It can help new members understand

what is and what is not expected of them.

- It can give current members, board/ committee, leaders, and the GM / COO a chance to welcome the new members and to share their collective knowledge.

Board (and

Committee) Orientation

What can it do for you? - It can help secure the future of the club.

Board (and

Committee) Orientation

B. Five Objectives to Orientation Bring new members up to speed Build loyalty and enthusiasm Communicate the club’s mission Teach policies and procedures Introduce formal and informal

networks

Board (and

Committee) Orientation

C. Who Conducts Orientation?Effective orientations are those that involve several people including:

-GM / COO

-Club Attorney -Club Board President -Other board members -Other staff members

Board (and

Committee) Orientation

D. Role of Board President or Committee ChairE. Role of Board or Committee

MembersF. Role of GM / COO

Board (and

Committee) Orientation

Format of an OrientationTypes of Orientations

- Group sessions - Individual sessions - Self-orientation - Mentor sessions

Board (and

Committee) Orientation

Orientation ActivitiesCommon activities to include:

-Tour of club - Discussion / overview session - Meal - Slides or media presentation - Panel discussions

Board (and

Committee) Orientation

Orientation ActivitiesCommon activities to include:

- Distribution of printed material

- Question / answer session - Board or committee

meeting - Follow-up actions

Board (and

Committee) Orientation

Orientation Materials (Format)Three common formats include:

File or pocket folders- Three-ring binders- Multiple binders

Board (and

Committee) Orientation

Orientation Materials

Materials for New Members Organization Chart Club’s Mission Statement

Board (and

Committee) Orientation

Orientation Materials

Definitions of Responsibilities Club Bylaws and

Articles of Incorporation Club Rules, Policies and Procedures

Board (and

Committee) Orientation

Orientation Materials

Club Financial Information Minutes of Meetings Pending Issues Calendar of Events

Board (and

Committee) Orientation

Orientation Materials

Names and Biographies of Members

Names of All Committees and Chairs

Board (and

Committee) Orientation

Orientation Materials

Director’s and Officer’s Insurance

Meeting Procedures and Customs

Club History

Board (and

Committee) Orientation

Implementation Plan

1. Setting orientation objectives 2. Delivering orientation materials 3. Planning the agenda

Board (and

Committee) Orientation

Implementation Plan

4. Informing the involved parties

5. Conducting the orientation 6. Following up with new

members

Learning ApplicationsNow that you’ve completed the session: What is the most important “take away”

concept you’ve personally learned? What idea(s) will you take back and share with

your staff? Which concept(s) will be important to share

with your membership? Which concept(s) will be important for you to

share with your President/Board? What do think will be your biggest challenge to

implementation?