Agenda item

Decision:

1.       Noted the changes the Chief Executive was making to ensure the Corporate Leadership Team had greater oversight of the Council’s companies, their objectives, business cases, and performance as summarised in paragraph 6.3 of this report;

2.       Noted the proposed revised governance arrangements relating to the Council’s company interests, set out at Part 3(1) of the Constitution, (Responsibility for Functions), as set out in para 6.1 to this report and appendix 1 and 2, and provide feedback on the proposals to the Monitoring Officer, by way of consultation;

3.       Noted the proposed revised governance arrangements relating to the Council’s company interests, set out at Part 3(2) of the Constitution, (Terms of Reference of Council, Leader/Executive and Committees), as set out in para 6.2 of this report and appendix 3 and 4, and provide feedback on the proposals to the Monitoring Officer, by way of consultation;

4.       Noted the Monitoring Officer’s intention to recommend to the GBC Corporate Governance & Standards Committee that they recommend to full Council the adoption into the Constitution of revised Parts 3(1) and 3(2) to reflect appendix 2 and 4, subject to the feedback of the Executive Shareholder and Trustee Committee.

Reason(s):

1.       It was considered that improvements could be made to the governance framework to ensure the shareholder had greater oversight of the Council’s interests in companies.

2.       Good practice would be for the Council’s senior officers to monitor the performance of the Council’s interests in companies, and to bring forwards reports to the shareholder in a regular, timely and transparent way with appropriate recommendations.

3.       Whilst the shareholder function was exercised by the Leader as an Executive function, there was currently no mechanism in place for scrutiny of such executive decisions and good practice would be for the Council’s overview and scrutiny committees to provide effective scrutiny of the shareholder role.

Other options considered and rejected by the Committee:

None.

Details of any conflict of interest declared by the Leader or lead councillors and any dispensation granted:

None.

The Council has various existing interests in Companies, whether by way of sole or joint ownership. The council, as shareholder, must have robust and resilient governance arrangements in place. Such arrangements must enable the Council, acting as shareholder, to have continuous oversight of commercial interests, business cases and performance measures of its Companies, to ensure continuous improvement and satisfaction of the council’s best value duty.

The Committee considered a report that reviewed the existing governance arrangements and made recommendation for change to ensure that the shareholder had greater oversight of the council’s interests in Companies; that there were more frequent and transparent reporting; better officer support to the shareholder, and clearer lines of responsibility and accountability.

The Constitution, at Part 3(1), set out the responsibility for functions and provided a framework for which functions were the responsibility of full Council, which were Executive functions and which were a matter of choice for the Council. Shareholder functions were designated as Executive functions. The Constitution did not provide clarity in respect of the authority to establish new companies. It was proposed that amendments are made to this Part of the Constitution to provide for this and a number of other principles regarding the responsibility for council-owned Companies.

There were recommendations to alter the terms of reference for the Committee to ensure that it met at least four times a year to undertake sufficient governance duties. Quarterly reports would also be considered by the Corporate Leadership Team in advance of submission to the Committee. Finally, there were recommendations to extend oversight of the shareholder function to the Corporate Governance and Standards Committee (or future Audit Committee) and the Services Overview and Scrutiny Committee. It was proposed the Executive Shareholder and Trustee Committee report annually to full Council in future.

The Committee welcomed the report and all recommendations set out therein.

RESOLVED:

1.       Noted the changes the Chief Executive was making to ensure the Corporate Leadership Team had greater oversight of the Council’s companies, their objectives, business cases, and performance as summarised in paragraph 6.3 of this report;

2.       Noted the proposed revised governance arrangements relating to the Council’s company interests, set out at Part 3(1) of the Constitution, (Responsibility for Functions), as set out in para 6.1 to this report and appendix 1 and 2, and provide feedback on the proposals to the Monitoring Officer, by way of consultation;

3.       Noted the proposed revised governance arrangements relating to the Council’s company interests, set out at Part 3(2) of the Constitution, (Terms of Reference of Council, Leader/Executive and Committees), as set out in para 6.2 of this report and appendix 3 and 4, and provide feedback on the proposals to the Monitoring Officer, by way of consultation;

4.       Noted the Monitoring Officer’s intention to recommend to the GBC Corporate Governance & Standards Committee that they recommend to full Council the adoption into the Constitution of revised Parts 3(1) and 3(2) to reflect appendix 2 and 4, subject to the feedback of the Executive Shareholder and Trustee Committee.

Reason(s):

1.       It was considered that improvements could be made to the governance framework to ensure the shareholder had greater oversight of the Council’s interests in companies.

2.       Good practice would be for the Council’s senior officers to monitor the performance of the Council’s interests in companies, and to bring forwards reports to the shareholder in a regular, timely and transparent way with appropriate recommendations.

3.       Whilst the shareholder function was exercised by the Leader as an Executive function, there was currently no mechanism in place for scrutiny of such executive decisions and good practice would be for the Council’s overview and scrutiny committees to provide effective scrutiny of the shareholder role.