Board and organisational wellbeing

Imagine a world where the staff and volunteers of your community organisation arrive at work every day with a sense of purpose, clarity and vigour, in a workplace that provides the conditions in which they can flourish.

They are energised by the challenges in front of them, are clear about their roles and feel that they are part of a robust, healthy environment that supports both individual and collective growth. The organisation overall is thriving: it has a sustainable model, it is mission focused and it is making a positive impact on the community it has been established to serve. There are clear policies in place to guide behaviour, there are well-established, fair processes to deal with conflict, and there is zero tolerance for bullying. The organisation has a healthy culture that permeates every aspect of its work. Workplace challenges are inevitable, but overall, it is a good place to be, and staff experience a high level of job satisfaction.

Imagine, conversely, that within your organisation there are high levels not of satisfaction but of staff and volunteer absenteeism, illness, and uncertainty about who is doing what. The people and the organisation overall lack direction and purpose. Staff feel trepidatious about going to work and operate within a culture of backstabbing, rumours and bullying. While there are policies in place to guide behaviour, there is a disconnection between how they are articulated on paper and how they are put into practice. Overall, the organisation is hanging by a thread and seems to lurch from one catastrophe to another. There are pockets of good work happening and these are having some positive impact, but this is because of committed individual staff members who go beyond what is required of them (and who are on the brink of burnout), rather than because of healthy systems and culture that support staff.

Looking at the two examples above as counterpoints, where do you think your organisation sits on the scale of overall cultural health and wellbeing? And to what degree is your board a part of and responsible for this?

These are important questions to ask, and they can help highlight the critical role that the board does and should play in shaping an organisation’s health and wellbeing. In ICDA’s view, while the board is not the sole agent of organisational health – leadership, staff behaviour and staff culture also play a very significant role – it is the board’s responsibility to set the tone, ensure proper leadership is in place, and provide the oversight necessary to maintain a healthy, thriving organisation.

Working with the governance wellbeing wheel

ICDA created the governance wellbeing wheel to help boards understand the relationship between the actions and precedents set at board level and the effects these have in the broader organisation.

The spokes on the wheel represent the board’s key areas of responsibility, and of course each of these areas affects the others. Take out or neglect any one of the spokes and you risk veering off the road. The ramifications may not be immediate, but if the board neglects one or more of these areas, eventually it will show up as an issue. For the organisation to keep moving forward in a well-oiled way, each of these spokes needs to be attended to and serviced regularly over time.

The wheel highlights seven key areas that, taken together, affect board and ultimately organisational culture. A board with a healthy governance culture will have a clear focus on mission and purpose. It will have a strong understanding of the relationship between governance and operations and it will understand and practise clear role delineation. It will provide big-picture strategic oversight underpinned by a good relationship between the board and the CEO, which will help the CEO to deliver on the strategy. The board will hold effective meetings and consider the appropriate governance factors when making decisions, and it will give all board members a voice in those meetings. Legal and financial oversight will be sound, and the board will regularly review its own activities. It will have an active succession plan in place for itself as well as the CEO.

If all these elements are attended to and the board consistently acts according to the organisation’s values, this culture will ripple out and create the optimal conditions to support health and wellbeing across the organisation. An organisation is like an organism in which everything is connected, even if the connections are not always visible to the naked eye. An unhealthy or negligent board can act like a chronic illness that erodes the health of the organisation over time. Initially, the symptoms might not be obvious, but as the dysfunction worsens, the effects become harder to ignore. Strong board governance is essential to keep the organisation healthy – it provides the necessary checks and balances, ensures alignment with the mission, and enables the organisation to navigate challenges effectively. Without it, even the most well-run organisation will eventually falter or fall.

In the next section we look at each of the seven spokes of the governance wellbeing wheel, highlight signs of ill and good health in each area, and point to some tools and resources that can help within each area.

1. Clear focus on mission and purpose

Wellnesswheel 1

How does this present itself?

In a healthy culture:

A board with a clear focus on mission and purpose always seeks to make decisions in the best interests of the organisation (this legal obligation is known as a fiduciary duty). Its members share a clear understanding that they are all working for the greater good. The board maintains a consistent focus on the underlying ‘why’ behind the organisation’s activities, its core purpose, the reason it exists. This is reflected in documentation but equally importantly is backed up by a robust culture of continuously calibrating decisions with reference to this primary purpose. Individual board members understand that regardless of any affiliations to subgroups they represent or advocate for, ultimately, all their decisions must seek to keep the big-picture mission in focus.

This clear focus and board coherence then ripples into the broader organisation. The board gives the CEO and operational team clear parameters around their activities, traceable back to the organisation’s core purpose. There is an overall sense of clarity and alignment: the organisation knows itself, why it is here and where it is seeking to go.

A board with a clear focus on mission and purpose regularly reviews its own activities and has systems and regular activities in place to maintain this focus. These may include annual strategic planning, building strategic parameters into board agendas and discussions, and ensuring that the organisation’s purpose is clearly articulated in relevant documents.

In organisational documents

  • Constitution (The organisation’s objects or purpose can be found here)
  • Code of conduct (Provides expectations of behaviour, ethics etc)
  • Board manual (Pulls together all key documents related to board role)
  • Strategic plan (Outlines vision for the future based on core purpose)
  • Annual report (Highlights the year’s activities and achievements with reference to core purpose)
  • Yearly board review (An opportunity to reflect, review and ensure that things are staying consistent with the mission)

Signs of ill health

If your board lacks direction, doesn’t have a clear focus and makes haphazard decisions, it probably has failed to build links between its own role and the organisation’s core purpose. If individual board members are acting in their own interest or in the interest of a subgroup of the board at the expense of the big picture, this reflects an unhealthy culture. It can foster division or lead to poor decision making or mission drift – or it can lead to all of these.

A dysfunctional board that lacks clear direction and is riven by internal conflicts can make things very difficult for the operational team. Without consistent guidance and oversight from the board, the CEO and team may face confusion and uncertainty about priorities and goals, which can lead to wasted efforts on misaligned projects and initiatives. A poor, divisive board culture can also create a sense of instability throughout the organisation and breed distrust and uncertainty. This in turn can reduce staff productivity, increase frustration, decrease motivation, reduce job satisfaction, and make it difficult for staff to achieve the organisation’s mission.

If your board is divided, lacks direction and is fostering a poor culture, it would be wise for the board to consider ways to reconnect with the organisation’s core purpose and work towards building a board that can unite around this common goal. We would recommend the board formally reflect on and review its role and performance and seek strategies for improvement.


TOOLS & RESOURCES

2. Clear role definition (govern, don’t manage)

Wellnesswheel 2

How does this present itself?

In a healthy culture:

A board that has established clear role definitions (and lives by them) will understand its core governance responsibilities and leave the managing to the CEO and managers. The delineation between board and staff roles will be clearly articulated in policies, guidelines and procedures so everyone knows what is expected of them. New directors will be given a board manual when they join the organisation, as part of an induction process. The definition and clarity of board roles will be reinforced in meetings, where the board’s focus will be on strategic oversight rather than operational decision making. Understanding of role delineation will be clear, conscious, and consistently discussed. Board members continually reinforce this, and it guides the way they work together and make decisions. For example, this understanding underpins board solidarity, board decision making, individual responsibilities, acting in the best interests of the organisation, declaring conflicts of interest, and not acting improperly.

Board members champion and advocate for the organisation. They may be actively involved in subcommittees with staff on them and they may participate in community and stakeholder events, but they will not direct staff or do the day-to-day work of staff. They understand that the board is there to steer the ship, not to row; to conduct the orchestra, not to play the trumpet. Even in smaller NFPs where there are no paid staff, board members must know when they are governing and when they are managing. Healthy boards are conscious of not meddling and live by the phrase “noses in and hands out”.

Board role clarity helps to create a culture of clarity throughout the organisation: operational staff have clear reporting lines through their managers to the CEO, and the board has in place mechanisms through which it works with the CEO.

In organisational documents:

  • Board manual (Outlines expectations, duties and roles of directors)
  • Board code of conduct (Outlines behavioural expectations)
  • Governance policy (Makes explicit the underlying principles of governance approved by the organisation)
  • Delegations policy (Provides parameters for CEO and staff to operate within)
  • Strategic plan (Outlines vision for the future based on core purpose)
  • Agenda (Aligns with strategic priorities)

Signs of ill health:

When a board is unclear on its role, signs of dysfunction can emerge, and these can seriously affect the organisation. Signs include:

  • micromanagement, where board members overstep into daily operations, undermining the executive team
  • frequent tension and a lack of trust between board and management
  • overlong meetings bogged down in operational details
  • lack of strategic focus, diverting energy from core purpose and vision.

These issues can lead to ineffective decision-making, inadequate accountability mechanisms, board member burnout, and erosion of stakeholder trust.

Addressing these issues requires a clear reaffirmation of roles, regular board evaluations, a structured governance framework, and ongoing training to realign the board’s focus.


TOOLS & RESOURCES

3. Strategic oversight

Wellnesswheel 3

How does this present itself?

In a healthy culture:

A healthy board understands that it is responsible for strategic oversight and has put in place a range of relevant mechanisms. These include a strategic plan developed together with key staff and stakeholders, and a plan for monitoring it. The strategic plan helps chart a course into the future, balancing immediate needs with a mid- to long-term vision, and taking into consideration funding, fundraising and resources. Decisions then are always made with reference to the strategic priorities, to maintain focus and stay united and on course.

The board develops the strategic plan through a healthy process of consultation and involvement with key stakeholders (staff, partners etc). It is a well-constructed, high-level overview and is able to be meaningfully implemented. This means that the operations team feels connected to the strategy and shares a sense of ownership of the direction and vision of the organisation. The strategic plan is a live document, subject to review and recalibration at healthy intervals.

In organisational documents:

  • Constitution (outlines the organisation’s core purpose, which drives all the strategies)
  • Strategic plan (outlines vision for the future based on core purpose)
  • SWOT analysis (often used as part of environmental review during strategic planning)
  • Operational plans (e.g. marketing, HR, infrastructure and finance plans; these operationalise the strategic plan and are developed and implemented by staff)
  • Budget (estimates income and expenses in line with strategy)
  • Meeting agenda (board papers often include reports related to strategic priorities)

Signs of ill health:

If your organisation doesn’t have a clear sense of direction, it could be that it doesn’t have a strategic plan, the strategic plan is not well constructed, or the strategic plan has not been effectively implemented or adopted by the operational staff. Any of these things would suggest problems in the strategic plan itself or in its implementation, or a cultural disconnect between the organisation’s vision on paper and how it is executed.

Strategy cannot be divorced from culture, and for boards, supporting and modelling a healthy culture is as important as putting together a well-articulated strategy. For optimal health both strategy and culture need to be working in unison to support the vision and direction of the organisation.

If your organisation has a whizbang strategy on paper but it is not being embraced or effectively embodied, it may be that there is a lack of cultural integration (shared values and vision) across the organisation as a whole and that this will need to be addressed as part of the strategic alignment. Strategy – the vision, where we want to go – needs to be backed up by culture and values, i.e. how we will get there. If the culture is unhealthy and inconsistent with stated values, this will affect take-up of the strategy.


TOOLS & RESOURCES

4. Board and CEO relationship

Wellnesswheel 4

How does this present itself?

In a healthy culture:

A healthy board–CEO relationship is built on clear role distinctions, mutual trust, and open communication. The board focuses on strategic oversight, while the CEO manages day-to-day operations, with both aligned on the organisation’s vision and goals. The board chair and the CEO have a strong working partnership characterised by mutual trust and respect, backed up a shared alignment with the organisation’s mission and vision, and informed by constructive feedback. Communication is frequent and transparent, and structured performance evaluations take place regularly, which fosters accountability and trust.

The board provides guidance and support without micromanaging, empowering the CEO to lead effectively. Both parties stay committed to continuous improvement and present a unified public front, reinforcing confidence and trust among the community the organisation serves.

In organisational documents:

  • CEO position description (outlines core requirements, priorities, KPIs etc)
  • Employment of a CEO policy (a policy relating to the conditions of employment of the CEO)
  • Board role descriptions (defines governance role of the board)
  • Strategic plan (outlines vision for the future based on core purpose; the board and CEO work together to formulate it, then the board monitors and the CEO supports implementation)
  • CEO annual review (provides an opportunity for the board and CEO to assess performance against agreed criteria)

Signs of ill health:

An unhealthy board–CEO relationship is often marked by blurred boundaries, mistrust, poor communication and frequent conflict. If roles are unclear, the board may overstep by micromanaging, or the CEO might act without sufficient oversight, leading to power struggles and frustration. Other signs of ill health include a lack of transparency, or infrequent updates; the infrequency can breed suspicion, causing the board to lose trust in the CEO’s decisions. In these types of relationships, disagreements often remain unresolved or escalate, creating a tense atmosphere that hinders effective collaboration.

Another sign of poor health is that the board has not put in place mechanisms to provide oversight of the CEO, so it loses sight of how the CEO is travelling and fails to ensure accountability or give appropriate guidance and support. For example, the board might not hold annual reviews or might not provide clear performance expectations.


TOOLS & RESOURCES

5. Effective meetings (healthy decision-making)

Wellnesswheel 5

How does this present itself?

In a healthy culture:

Healthy, effective board meetings are well-organised, focused and productive, allowing the board to fulfill its governance role effectively. They begin with a clear agenda, distributed in advance, so board members can prepare for discussions. Meetings are structured to prioritise strategic issues and long-term planning rather than operational details, keeping conversations focused on high-level objectives. The board chair facilitates discussions, ensuring all members participate while maintaining a respectful, inclusive environment. Reports from the CEO and committees are concise, informative and relevant, enabling the board to make well-informed decisions. Action items and next steps are clearly defined, with accountability assigned, so everyone understands their responsibilities. Board meetings end on time and with clear summaries, leaving members feeling engaged, aligned on goals, and empowered to support the organisation’s mission.

This clarity, effectiveness and follow-through help create the right governance scaffolding around the operations team. This in turn ensures there are clear guidelines, parameters and supports in place for the CEO and staff to work within.

In organisational documents:

  • Constitution (provides some information on meeting rules etc)
  • Code of conduct (outline expectations of behaviour and conduct in meetings)
  • Strategic plan (outlines vision for the future based on core purpose and helps define meeting priorities)
  • Agenda (outlines key talking points)
  • Minutes (a legal requirement to record decisions of the board etc)
  • Actions arising (tracks actions from meetings and helps maintain accountability; can be recorded in the minutes or in a separate document)

Signs of ill health:

Unhealthy board meetings tend to be unfocused, poorly organised, and dominated by individual board members or operational minutiae rather than strategic issues. Without a clear agenda or pre-meeting materials, board members may arrive unprepared, leading to inefficient use of time. Discussions might frequently veer off-topic, with board members either micromanaging management’s tasks or engaging in lengthy debates on minor details. The board chair may struggle to keep the meeting on track, allowing a few voices to dominate while others are sidelined, leading to disengagement and frustration. Decision-making is often slow or absent, with action items left vague or unassigned, resulting in confusion and lack of accountability.

These problems tend to lead to board members feeling demotivated, which in turn leads to lower attendance, poor morale and weakened governance. This will then ripple into the overall organisation as the board will be seen to be weak and ineffective, asleep at the wheel, divided or simply disorganised. A high-functioning CEO and staff team could hide this for a time, but eventually it will lead to important governance responsibilities being missed, which could have all sorts of ramifications at the operational level.


TOOLS & RESOURCES
Wellnesswheel 6

How does this present itself?

In a healthy culture:

A healthy board maintains legal and financial oversight by implementing rigorous governance practices, regular monitoring, and adherence to compliance standards. Board members fulfil fiduciary duties by actively participating in financial planning, approving budgets, and regularly reviewing financial statements and audits to ensure transparency and accountability. They establish and oversee the implementation of policies for financial management, risk assessment and internal controls to prevent misuse of funds and mitigate potential risks.

To maintain legal oversight, a healthy board ensures the organisation complies with relevant laws, regulations and filing requirements, including tax status regulations and reporting obligations. It also implements and monitors policies on ethics, conflicts of interest and whistleblower protections to uphold integrity and accountability. Board members engage in training to stay informed about governance standards and best practices, so they can make informed decisions and provide effective oversight. This approach allows the board to safeguard the organisation’s resources, reputation and long-term impact.

In organisational documents:

  • Financial reports (usually including annual budget, profit and loss, cash flow statements and balance sheet)
  • Financial audit (yearly audit of finances conducted independently, if required)
  • Financial controls policy (provides parameters around financial transactions, use of credit cards etc)
  • Risk register (record of some of the legal and financial risks the organisation needs to be mindful of)
  • Reports to regulators (some level of reporting will be required by the relevant regulator, e.g. ACNC, ORIC, state department of consumer affairs)
  • Compliance register or calendar (a document to keep track of reporting requirements)
  • Funding acquittals (required by donors to account for how grant funds were spent)

Signs of ill health:

An unhealthy board may neglect its core legal and financial responsibilities. This board might avoid regular review of budgets or audits, leaving financial reports unanalysed and potential issues unaddressed. Members may be unaware of compliance requirements, leading to missed filing deadlines, poor risk management, and potential legal or tax penalties. Without clear policies or active monitoring, unethical practices, conflicts of interest, or even financial misuse can go undetected, putting the organisation’s overall reputation and sustainability at risk.

This neglect of core board governance responsibilities will more than likely eventually lead to some level of breakdown or even a catastrophe. It’s a bit like keeping a car on the road without servicing it, insuring it or maintaining your driver’s licence. You’ll end up being fined or breaking down at best, and injured or killed at worst.


TOOLS & RESOURCES

7. Succession planning

Wellnesswheel 7

How does this present itself?

In a healthy culture:

Healthy succession planning at the board level is proactive, strategic, and aligned with the organisation’s future needs. It begins with identifying the skills, experience and diversity needed to support the organisation’s mission, assessing current board members’ strengths, and identifying gaps. It requires establishing a structured process for recruiting, vetting and inducting new members, ensuring continuity as members transition off the board. This process will also need to be in place for the recruitment of a new CEO if required, and a healthy board manages the transition from one CEO to another to ensure that it is as smooth as possible.

Healthy boards regularly review their own term limits and succession timelines to prevent sudden vacancies, using staggered terms to maintain continuity of knowledge. They cultivate leadership within the board by developing future leaders through mentorship, committee roles, and rotating leadership positions. Succession planning includes preparing for the departure of the board chair and other key officers, ensuring qualified members are ready to step into these roles. This approach keeps the board dynamic, resilient, and well-prepared to lead the organisation over the long term, even through transitions.

In organisational documents:

  • Constitution (defines board terms and can be changed if required to cater for succession needs)
  • Board skills matrix (helps boards identify gaps in skills and knowledge)
  • Board member induction policy (outlines how board members are inducted)
  • Board manual (helps transition new board members onto board and provides role clarity)

Signs of ill health:

Unhealthy succession planning at the board level is typically reactive, disorganised, and lacking a strategic approach. Often, there is little formal process for identifying future board needs, leading to gaps in critical skills and experience. The board may neglect term limits or ignore staggered terms, resulting in sudden disruptive vacancies or an abrupt loss of institutional knowledge if multiple members leave simultaneously. Without a pipeline of prepared leaders, transitions for the roles of chair, secretary or treasurer become rushed and people may end up taking on roles they are not prepared for. Similarly, if the board is reactive or haphazard in relation to appointing a new CEO when the time comes, it risks significantly destabilising the organisation.

Unhealthy succession planning can also lead to a stagnant board, where the same individuals remain in leadership roles for extended periods, discouraging fresh perspectives and innovation. Without structured inductions, new members often lack the guidance and information they would need to contribute effectively. This lack of planning and continuity risks instability, lowers board effectiveness, and hinders the board’s ability to respond effectively to organisational challenges.


TOOLS & RESOURCES

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