How governance reform is securing sustainability and growth in golf clubs

To deliver a winning performance on a golf club board, there’s a growing realisation that good governance is just as important as a good handicap.

Golf clubs have traditionally been run by passionate members who put their hands up to join their clubs’ committees. But there’s increasing recognition that many clubs need to improve the standard of governance. And also to better equip those members with the skills to respond to changing demands from players and to oversee budgets of several million dollars, as well as valuable assets like grounds and facilities.

“It’s one thing to be passionate, but you also have to be a knowledgeable director and understand that we can’t be running the club for our own benefit,” says Nicola Barrett-Lennard, club captain (women’s) at the Royal Sydney Golf Club. “We have to run the club for the benefit of the entire membership. We’re a medium-sized business and our shareholders are our members. So we really need to be diligent about how we manage the assets we have here.”

Barrett-Lennard, who has a background in advertising and marketing, became women’s captain in 2022. Because the role came with a board seat, she decided to undertake the Golf Australia Club Governance Program, developed in collaboration with the AICD. More than 540 directors have so far completed the program.

“We’re a multimillion-dollar organisation, a proper business and I’ve learned a lot sitting on the board, but I wanted to make sure my skills were crisp and I am contributing appropriately,” she says. “One of the first things the course teaches you is that your job is not to manage a business from a day-to-day perspective. It’s to have a very serious and diligent review of the business, have a vision and objectives. The pillars of management are then fulfilled by staff — and it takes a great deal of discipline not to stick your nose into it.”

Many clubs are now embracing the need for strong governance. This is one of the key challenges the 11,000 volunteer directors at Australia’s 1500 or so golf clubs face. Many don’t have backgrounds in governance or boards, but according to Claudia Marazita, head of workforce engagement at Golf Australia, even some members who are experienced directors have been known to let their enthusiasm for the game overrule business smarts when they come onto a golf club board.

“If we don’t have good governance as a key area of focus for clubs as a whole, we won’t see clubs grow and be successful,” says Marazita.

Some golf club general managers and chief executives are concerned that board members might try to micromanage the club and get involved in the day-to-day operations, rather than taking a strategic oversight, a survey of paid golf club employees by Golf Australia reveals.

After hitting a low of 383,000 members in 2019, golf club membership in Australia has risen for the past five years, hitting 459,143 members in 2023–24. This success belies a challenge facing golf clubs in Australia — changing demands from golfers. More club members, particularly younger ones, want an alternative to playing a full round of golf and taking part in competitions.

Long-term challenges

“New members don’t necessarily want the traditional golf club model where you join as a member and you play five times a week, 18 holes, and you play in competitions,” says Michelle Hartman, company secretary and treasurer at Southport Golf Club in Queensland. “We know a lot of the growth in golf is actually coming from off-course, because people don’t have the time.”

This is the long-term challenge directors need to focus on, rather than the day-to-day operations of their clubs.

Hartman was a tax and advisory partner at Big Four accounting firms before retiring to Queensland and taking up golf. She came onto the board as company secretary after the committee decided it should be a voluntary position and separate from the general manager’s role. She had completed the AICD Company Directors Course several years earlier and recently undertook the golf governance course as a refresher. Now she wants the other members of the committee to complete it as well.

“A lot of golf club directors are passionate about golf and passionate about their club, but don’t necessarily have the corporate experience, so they’re not really aware of what the role of a director is — or the role of a board,” she says.

The Southport committee has introduced several governance reforms in the past couple of years. It has codified its policies around conflict of interest and is working on a disciplinary policy. The club is considering a change of constitution to widen its pool of potential directors. It has established a nominations committee that will focus on bringing in directors with the specific skills needed by the board.

The committee is also putting more effort into the induction of new members and ensuring they’re aware of the time commitment required, particularly as they’re also required to join a subcommittee.

“There is an increased expectation of governance now for boards and the behaviour of directors,” says Hartman. “We’ve really been pushing back on where there’s been any conflict or perceived conflict to make sure the members don’t accuse the board of being like a boys’ club. Everything we do now, I say, ‘Well, hang on a second. How would the members react to this?’”

The changes have led to more open and robust board discussions and directors aren’t afraid to challenge and talk about how things could be done differently, says Hartman.