Boards with Purpose - Virginia Bourke and Martin Laverty

00:00:13:26 - 00:00:49:06

Phil

Good stuff. All right. We're going to. We're going to rock and roll. Good. So welcome to boards with purpose. This afternoon I'm joined by Martin Laverty, CEO at Aruma, and Virginia Bourke, chair at Mercy Health. But of course you both got a whole stack of other roles, right? And we're going to talk about key governance from both the perspective of an introduction to key governance, how it's evolved over the years, and what you're saying to make key governance work better in your organisations.

 

00:00:49:06 - 00:01:22:13

Phil

And any tips you've got for directors, executives and leaders of this critical area? In fact, I was thinking in the lead up to today, you guys have got one of the most important jobs in Australia looking after those people in care, whether that be our mums and grand mums in aged care, have kids in disability. It's a really important area that you're involved with.

 

00:01:22:15 - 00:01:39:02

Phil

And I'm mindful that that brings a lot of pressures with it, as well. So let's kick off in terms of care governance. Where do you see key governance sitting? How is it evolved now? I'm going to kick off with you.

 

00:01:39:04 - 00:02:14:11

Martin

Well, just so that we all know what we're talking about first, Phil and Virginia. I see K governance as the spectrum from hospitals through aged care, through child care, disability care. And it's perhaps important, that's the experience that I've had across those four segments of the care economy. And common to all of them is a path to professionalisation, that, yes, hospitals have been around for hundreds of years, but they've been required in recent decades to professionalise.

 

00:02:14:11 - 00:02:43:02

Martin

We've only had, care standards for our hospitals for the last three decades. We've had them in aged care effectively for two decades. Child care, they've been there for two decades, but they've really been reformed in recent times and in disability care. That is the very example of what was once families, community that is now being professionalised.

 

00:02:43:05 - 00:03:11:12

Martin

And as taxpayers who are funding all of these systems, and for those of us that have our family, our loved ones in care or working in care, we're all quite focussed on how do we keep people safe. At the same time, how as a nation do we afford it? And for the director that's overseeing either the hospital through to the disability care service, they're confronted with all of those pressures, those expectations all at once.

 

00:03:11:12 - 00:03:35:22

Martin

And a key theme that I want to unpack a bit today is that in disability, in child care, where the governance standards are still evolving, we've got a lot to learn from hospital care. That's worked it out a few years beforehand. And that's that's why I'm delighted that Virginia is here, because she's had that direct experience in hospital and aged care that can help inform where child care and disability care is going.

 

00:03:35:24 - 00:03:41:24

Phil

Absolutely. And it's keeping them safe, but it's also thriving, right. So it's not just about yeah.

 

00:03:41:26 - 00:04:05:24

Virginia

Yeah. That's right. You can you can really see the, the development of clinical governance over. Well, I'm thinking over the last 30 years where health care institutions had various crises and so forth, and clinical governance, care governance became, you know, a field of expertise and development. But, Phil, to take up your point now, in the New Age Care Act, we actually have a definition of high quality care.

 

00:04:05:27 - 00:04:24:25

Virginia

And it does. It doesn't mean just keeping people safe. It means allowing them to live in a way that respects their dignity, that allows them to engage in behaviours that might actually, eventually, might actually cause them harm. Indeed, you know that it. That's called the dignity of risk. We allow people to undertake activities that they want to undertake.

 

00:04:24:27 - 00:04:59:27

Virginia

So there's I think there's huge development also in understanding what is quality care, what is the care that we're trying to deliver to the people in our services. And I think also there's been a growing understanding, certainly within aged care, that we really need, systems that are integrated across our organisation. So when we talk about clinical governance or care governance, that is an integrated framework that, tells us what is the standard for our organisation in terms of delivering care.

 

00:05:00:00 - 00:05:34:15

Virginia

And it will include roles and responsibilities. And the policies and processes that we need. And it will give us all the common standard to aspire to, but is not just sitting in a silo. And I think directors need to understand that. And that that has been an area in which there's been a lot of development in director understanding and continues to be, I think, a need for the director community to understand what does care governance may now in a contemporary setting, and how can we really deliver care that enables people to live full lives?

 

00:05:34:17 - 00:05:57:13

Virginia

And that is so often, I think, completely aligned with the mission and the vision, particularly of our organisations, which are in the not for profit sector. Many are also faith based based organisations. And I think all of us have this common, commitment to providing care that recognises the dignity of every person.

 

00:05:57:16 - 00:06:46:27

Martin

So can I just tease out Virginia is very astute observation, having worked alongside boards of hospitals of aged care services currently disability, but also being involved in childcare. I've seen generalist directors, ASX directors really, really talented people with extraordinary skill sets come into these environments. Really good on overseeing financial risk, quite in the dark about how you consider care outcomes, whether it be the wellbeing and welfare of children in childcare, or how you see and know in disability care that good is happening.

 

00:06:47:00 - 00:07:19:04

Martin

These areas are still ill defined. And right now we're asking a lot of a generalist director to come into an area where clinical governance is at a different level in maturity. In hospitals, clinical governance is clearly established, systems exist, there is professional training for clinicians in childcare. What is the outcome of a child's day in a centre? What is the outcome that you measure for a disability?

 

00:07:19:04 - 00:07:51:01

Martin

Support how these are still maturing and evolving areas of clinical governance that we don't have black and white answers for. So for those directors coming in, having that contextual understanding, but also really importantly how we quickly get to common definitions of what is the standard of care, what is the outcome that we're after. But in disability and childcare, I still think there is a maturing that aged care and hospital care is a little further advanced.

 

00:07:51:03 - 00:08:16:11

Phil

And we've also got a lot of directors who have probably been around these organisations for years and might not have picked up on. The world has changed. And I see that as a real issue as well, of actually getting people to understand that the world has changed and and the expectations on them as directors are different than they were a decade ago.

 

00:08:16:14 - 00:08:44:15

Virginia

Yeah. That's right, Phil, there's been a huge shift in community expectation, of our organisations, I think. And so therefore, in terms of director accountability, and that played out through the Royal Commission's Nitschke disability, mental health in Victoria. And so I think that means that directors now have to have, really a, far more developed understanding of the organisations that they are governing.

 

00:08:44:18 - 00:09:22:05

Virginia

It means that you really have to bring a disposition which is quite different, I think, to the disposition directors might have had 20 years ago. You have to take a very proactive, and diligent approach to, understanding your organisation, understanding how care is delivered. Now, that is a really significant shift. And I think also in certainly in aged care, that shift, which has been going on for a long time in a general sense, I would say, but now coupled with the Royal commissions and legislative reform, particularly the New Aged Care Act, there's now, direct accountability for the health and safety of the people in your care.

 

00:09:22:07 - 00:09:46:18

Virginia

And there are civil liabilities, civil penalties, I should say that, extensive and that are now linked to the delivery of care. So I think, most directors now, I think are understanding that there has been a huge shift and it affects the way that you practice as a director. And I think that's what we're talking about today is really how do you practice as a director in this changed environment?

 

00:09:46:20 - 00:10:10:04

Virginia

There is increased, penalties and accountability for you as a director. But more than that, the whole shift has been towards, the human at the centre of of care. And that's a really big shift. And we've seen it in legislation when really the Old Age Care Act really was about, providers and financial sustainability and so on, or, financial accountability.

 

00:10:10:04 - 00:10:28:24

Virginia

But now the shift is the human, the person delivering care. The older person, in the case of the Aged Care Act is at the centre of the act, and that is the focus for the director. And I think that shift, it's probably been mirrored in your sector as well. I'd be interested actually, to say whether you feel the same shift.

 

00:10:28:26 - 00:11:06:03

Martin

Well, this gets to the the nub of the challenge. How do you know when the person centred the human centred care outcome is being delivered in an episode in a surgery, in a hospital admission through an ad, you're able to track what was the health care outcome of that episode. In aged care, not only now is there a regulatory obligation, but you can see through the absence of harms, through engagement, through wellbeing, in disability care and child care.

 

00:11:06:03 - 00:11:37:27

Martin

We don't yet have that universal measure, but we do have regulator expectation. And in recent times, the number of occasions I've heard directors say, how would this look if I had to appear before a royal commission and explain a decision of my board, of my executive around some of those outcomes? I think directors, the benefit of there being a string of royal commissions that are often criticised for not achieving much.

 

00:11:37:29 - 00:12:03:04

Martin

The benefit is it's changed the attitude of executives and directors to think, if I was on the stand, how would I explain this? Even if the system, even if the definition of what a good outcome in child care or disability care is, is ambiguous to me. So I think directors have a benefit by that type of scrutiny. It's changed mindset and that's in the interests of us all.

 

00:12:03:11 - 00:12:32:19

Phil

So in the royal commissions or all of them, I think we've seen examples where, to be honest, directors were asleep at the wheel. They didn't fully fulfil their duties and obligations that we would now expect to occur. And of course, as a society, we do learn, from those examples. How do we get the learnings of those royal commissions more broadly understood?

 

00:12:32:21 - 00:12:40:05

Phil

How do we get that director community, and do we need to be sourcing a different cohort of directors to make that happen?

 

00:12:40:07 - 00:13:13:02

Martin

Well, I think the most profound royal commission that we've had in recent years, was the inquiry into sexual abuse of children within institution, institutional settings. It's had a profound impact on the way in which we safeguard children and young people of expecting voluntary organisations that did not have formalised or mature systems of governance, and it's cascaded across all parts of the care economy.

 

00:13:13:05 - 00:13:56:24

Martin

Not just because parts of the care economy is still not for profit, volunteer led in many cases. But it's illustrated what happens when you leave governance in abeyance for so long. I think there's been a profound impact of the banking royal Commission on the not for profit care economy as well, that directors that live in the worlds of finance, that live in the worlds of markets, that's saying that even those institutions with extraordinary or seemingly really well-established systems of both governance and accountability within them were left wanting because of the decision or the lack of activity of directors.

 

00:13:56:26 - 00:14:29:25

Martin

And to hear within the boardrooms in which I work those references, it indicates that the Royal commissions have had a positive impact. They've actually alerted directors to that idea of someone always looking over their shoulder, not just the shareholder or the members or the mission purpose, but the idea of regulators, requiring reasonableness in how decisions are made and to hear directors in, board meetings, particularly when there are options and ambiguity.

 

00:14:29:28 - 00:14:58:18

Martin

How would this look? Would I be seen as reasonably fulfilling my obligations in relation to a care outcome, where that care outcomes definition is ambiguous? We're better off for that. But I'd also say let's not have any royal commissions for a while, because to some extent the sector has been royal commissioned out. There's only so much you can eke out of these sectors before you have to get on and just build your systems of governance.

 

00:14:58:21 - 00:15:28:09

Phil

So we've heard, I think, lots of organisations now moving into having various structures, structures, practice governance frameworks, and the like. And Virginia, I'm sure Mercy Health, has had those for quite a while, but I'm imagining for smaller organisations these can be quite challenging things to have set up. What do you what are you saying in terms of orgs dealing with that?

 

00:15:28:12 - 00:15:53:20

Virginia

Well, I think that the certainly the messy health is a large organisation. And yes, we've had clinical governance frameworks for 30 years, but it is always an iterative process and the focus is including under the Aged Care Act itself, continuous improvement. So this is a dynamic process. And I think no matter what your size or scale you, you need to be always thinking, what is the best practice here?

 

00:15:53:20 - 00:16:15:26

Virginia

What is it that we can do better? And so I would say that, every organisation now needs a clinical governance framework. So it's an integrated framework that will tell you, what are the systems I need? One of the roles and responsibilities for each layer, for the point of care, the volunteer, the manager, the executive. What's the role of the board here?

 

00:16:15:28 - 00:16:43:15

Virginia

And I think that's helpful no matter what the size of your organisation. But I think, Phil, your question probably goes to how do you resource that expertise in a sector where everyone wants the same expertise? So I think that's a real challenge. There are a lot of resources available now. So I think even smaller organisations and probably access a range of resources, the commission certainly is indicating that has a disposition to assist organisations that are struggling, as does the department itself.

 

00:16:43:22 - 00:17:04:15

Virginia

So I think there are ways to approach the challenge of whether you have a clinical governance framework in place. But I think one of the dangers is not to simply rely on, the clinical person on your board. Now, within aged care, we're now required to have a person with clinical skill and expertise on our boards. We cannot simply rely on that person.

 

00:17:04:22 - 00:17:23:01

Virginia

It is both unfair. And also that is not the point of the reforms. So I think that all directors, no matter what the size and scale of your organisation, we all need to upskill in clinical governance. It's a bit like, follow. I'm thinking back to the central case.

 

00:17:23:03 - 00:17:25:26

Phil

When we just had the one accountant on the board.

 

00:17:25:29 - 00:17:47:25

Virginia

Yeah, yeah. And I'm out of that. I think most directors will recall that. Now you simply have to be financially literate if you are a director on whatever board that you're on. So I think similarly, out of all of the royal commissions and the reform, the legislative and regulatory changes, you must be, literate in care governance and clinical governance to serve on boards.

 

00:17:47:25 - 00:18:22:02

Virginia

And I think that's the responsibility of directors. And people can complain about that and say it's all too much, but it's not actually because it's the point of our organisations. So I think that it's appropriate for us to expect a high standard of engagement by the director community on this. I think the resources are there. But I do appreciate, and I have spoken to some directors who are finding that a struggle or they may be finding it difficult to attract directors because now to the list of things that you must be across is governance.

 

00:18:22:02 - 00:18:44:00

Virginia

And some people are actually a little bit fearful about, governance, clinical governance. They say I'm not an expert, but that's not the point of being a director. You have to know enough. You have to know enough about your organisation and about the risks and issues in your organisation, to ask for the right information at the in the boardroom so that you can ask the right questions.

 

00:18:44:03 - 00:18:55:16

Virginia

And that's the real. That's the practice. I think that directors need to have asked the right questions. But to do that, you need the right information to to have the right information, you need to know enough about your organisation.

 

00:18:55:19 - 00:19:25:11

Phil

And you need to have the right people. Right. And I'm thinking as our society, in terms of providing great care across all of those care sectors, we've got a lot of organisations requiring directors, requiring executives. Have we got the cohort of people that can actually take those roles on? It is, is that going to drive change in the marketplace?

 

00:19:25:14 - 00:19:59:08

Martin

Well, feel it's easy enough to attain financial literacy skills to be a director if you don't have them. The ability to read a set of accounts to understand balance sheet movements. Yes, it obviously matures over time, but it's a generic skill and there's lots of support. OECD in particular about developing that clinical governance. The oversight of a human care outcome is a bit more tricky.

 

00:19:59:11 - 00:20:39:25

Martin

So yes, our doctors and nurses, our allied health or those that have been around the healthcare sector, they've got a real good head start. But in this world of overseeing really large human service enterprises, where births occur and deaths are part of the daily routine, establishing those skills is confronting for some, it is unfamiliar. And I don't think we've got a really good path to provide us with a pool of directors that we're going to need, particularly in those areas that are themselves still professionalising, which is disability.

 

00:20:39:25 - 00:21:17:09

Martin

Our hospital governance around the country, we have to say, is not too bad. Our aged care governance around the country is still maturing, particularly to your point of small, NFP that might be regionally or rurally located. I think there's rapid variability in the oversight of childcare, and disability has got a long way to come. But part of that is we have to establish clinical governance at board in exactly the same way that we have financial governance at board.

 

00:21:17:09 - 00:21:57:29

Martin

The two need to be given equal positioning because you need to have a viable organisation that fulfils its financial obligations in order to exist. But your licence to provide a service in the care economy means that you have to have functional governance over whatever part of the human services you're providing, and we're not there yet, and it troubles me because I see it playing out in organisations, particularly under the NDIS, an extraordinary time of uncertainty, of reform, of rapid change, where directors have really got to have their wits about them.

 

00:21:58:01 - 00:22:24:10

Martin

They're struggling with the financial pressures of the NDIS right now, and some are doing really well with the clinical governance oversight and others, I think, need real help. It's in fact an area where not just the OECD should step in, but I think there's a role for the regulator in disability to acknowledge that we're still maturing. The system of disability governance, and it needs some support.

 

00:22:24:13 - 00:22:54:14

Phil

And it's a different market as well. Right. You've got a very long tail of very small organisations or that still family run businesses, probably both in early childhood and disability, a swathe of that middle tier and then some very large providers, otherwise expected to see more in terms of merger activity happening, in that space.

 

00:22:54:17 - 00:23:05:29

Virginia

I think it will drive it will drive merger activity. The pressure of regulatory change of clinical governance requirements. I think that is a real factor.

 

00:23:06:01 - 00:23:31:18

Martin

There are less hospitals in Australia today than there were 30 years ago. There are less aged care providers in Australia than there were 20 years ago. It will be the same as population demand and service demand is increased. There's been consolidation in hospitals, in aged care. You can see some consolidation in childcare, in disability care. Good start.

 

00:23:31:18 - 00:24:08:22

Martin

Learning is the perfect example of where really clever, NFP leaders stepped in because of a commercial sector governance failure in childcare. And you've got to say, could start learning today is the standout provider because they've worked out their quality governance. They're really specific on their purpose. They know on what good outcomes and how to facilitate them, because they've got a system of quasi clinical governance overseeing it, the small, childcare provider.

 

00:24:08:22 - 00:24:34:10

Martin

And similarly, the smaller Not-for-profit disability provider doesn't have those same, opportunities to embed those those practices, even that state of mind, while you're struggling to just sustain financially an NDIS organisation at the moment, the opportunity to really spend time on and invest in your quality governance is constrained.

 

00:24:34:13 - 00:24:50:21

Phil

Yeah, I'm mindful of the processes, but I'm also very mindful of the need for the right culture to be going on within the organisation to meet those expectations. You know, how are you doing that in a big organisation?

 

00:24:50:26 - 00:25:14:14

Virginia

Well, I think the the monitoring of culture is actually part of the clinical governance framework, that it should be part of the clinical governance framework that you set up. So the way in which you monitor culture in an organisation, again, an area which has been under some development for some time, that's an important part of clinical governance, as is the level of engagement with consumers, with the patients, residents, clients.

 

00:25:14:16 - 00:25:48:20

Virginia

So both of those things are actually part of a clinical governance framework. And I think one of the traps is that clinical governance has been perceived, perhaps in a narrow sense, when really it is a much broader, and system oriented, aspect of governance. So those things are really important. And without, when you think about this, the really significant clinical governance failures and an example would be the Okt and aged care facilities in South Australia, which really was the precursor to the push for a Royal commission into aged care.

 

00:25:48:22 - 00:26:16:29

Virginia

When you think about one of the of defining factors in the many, horrendous failures, there was a toxic workplace culture in which no one could speak up, in which indifference to the clients, to residents was, the norm within that workplace. So, you know, that's the worst example you could have, probably. But it was the culture of that place, the culture of the oversight, which was really no inquiries were made.

 

00:26:16:29 - 00:26:43:09

Virginia

There really, really was very limited oversight. But all of those aspects were found to be factors in care failures. So I think feel that is absolutely critical to, you know, to your clinical governance framework. And in turn, the clinical governance framework, one that is embedded will drive your organisational culture. It will be the focus. So I think the just critical aspects of the framework itself.

 

00:26:43:12 - 00:27:13:04

Virginia

But I just wanted to comment on, we were talking about the director, the pressures on directors. There's also this sort of inherent tension, which I think is quite difficult for directors in the care sector, that, or perhaps I'm thinking really mostly of aged care here, that we have a requirement now under the act that we are we deliver high quality care that's now defined and that our organisation is adaptable and that we can, continuously improve.

 

00:27:13:05 - 00:27:35:28

Virginia

There's a dynamism within our organisation, will adapt to technology to AI, will improve outcomes for our clients. So this is required of us now and it is proper and will have the human that we're, looking after at out at the centre of our, organisation. But at the same time, the director must also be mindful of a really increasing regulatory and compliance overlay.

 

00:27:36:00 - 00:27:59:06

Virginia

So you've got those two things which you know, tension. Well, there's always sort of a paradox there, a really significant focus on compliance and a requirement to be a continuously improving an agile and adaptable organisation. And I think often for directors that tension is very difficult to balance. And you can overweight on compliance. And it's a huge tendency to do that.

 

00:27:59:08 - 00:28:26:13

Virginia

Because, you know, you want to make sure that your organisation is run properly and so on. So I think, sometimes naming that tension, not everyone wants to live in that tension as a director. And I think that's one of the challenges, too, for attracting people to our sector is can be really hard to have a dynamic, forward looking, engaged, board when you're also almost weighed down by a significant regulatory compliance layer.

 

00:28:26:15 - 00:29:04:12

Martin

While you've still got to make a profit to be viable. And that is the future. Yeah. At a time where the taxpayer contribution in particular, or the consumer contribution is becoming increasingly constrained, this is not an easy environment for any of us to work in. We do so because it's centrally important and really rewarding. But I do think that time of the director volunteering in particular in the not for profit sector to serve on the local childcare, the local disability organisation, the local aged care, and even to some extent, putting your hand up to work on the local health district board as well.

 

00:29:04:15 - 00:29:44:21

Martin

The burden needs to be really, truly understood continuous improvement, regulatory interaction, constrained funding and then the consumer expectation that voice of the consumer and the consumer driven care that has to be at the heart of these, is sometimes, not given the priority against those regulatory continuous improvement and financial arrangements. So not straightforward, but I think it might be important for us to give that assurance that even with this complexity, we are still seeing extraordinary outcomes across the care economy.

 

00:29:44:23 - 00:30:16:02

Martin

And this idea of learning clinical governance, of ensuring that directors understand it needs to be made accessible. Let's perhaps try and unpack what we mean by clinical governance. In my mind, it's that there is an evidence base that you have an appropriately skilled staff working on that evidence base, that you have systems of monitoring and oversight, and that you have a consumer voice at the absolute centre.

 

00:30:16:05 - 00:30:36:02

Martin

Now, that's a really simplified way of talking about what clinical governance is. But the director who sits on top of that system should say all of those things operating. And if they can't, they need to be asking the questions as to why not and ensuring that you get on to a position where you know what the evidence is.

 

00:30:36:02 - 00:31:05:11

Martin

There are guidelines to inform the type of staffing and the way in which they work, that you have the systems of monitoring and reporting up transparency, if you like, not just because the regulator needs it, but most most importantly, what is the consumer experience of the receipt of whatever human service they're receiving? If you've got those basics right, that's clinical governance in practice, different in hospitals as it is to childcare.

 

00:31:05:13 - 00:31:27:20

Martin

But they're the types of principles. And if we see those in the same way that we know we have to prepare for financial audit, we have to be monitoring our monthly management accounts to make sure they are hitting us in the right direction. We're budgeting. It's got to be seen as just as important. And in some of these environments today, there's still some work to do on making them equal.

 

00:31:27:26 - 00:31:54:27

Phil

And in terms of getting the board tax and the information that you receive, and I just keep getting bigger and bigger and bigger. Right. Had how do you make sure that you can have that right messaging in there, that and from an executive perspective that you're not bluffing or overloading directors with the information, but similarly, the directors need to be asking for the appropriate information.

 

00:31:55:00 - 00:31:57:08

Phil

How are we going to get that balance right?

 

00:31:57:10 - 00:32:16:07

Virginia

I think that is a constant. It's a work in progress. And every board that I have been on that is a work in progress is how do you get the level of director information. Right. And this and of course, when you have a really significant regulatory or legislative shift, you have to do that work all over again and make sure, are we meeting these new standards?

 

00:32:16:07 - 00:32:45:21

Virginia

What do they really mean? Have we got the evidence that we need. What's the data here? So at Mercy Health we've spent a lot of time mapping, all of the, all of the standards that are required across our whole organisation, both in health, in aged care, home care, residential aged care, and then really looking at what is it that the homes are monitoring what's being monitored on the site, what's being monitored in the next layer up, which would be, a clinical governance committee at a management level.

 

00:32:45:23 - 00:33:07:14

Virginia

And then what flows up to the board quality committee and then what flows up to the board. And we've done a lot of work to make sure that at each of those levels, the appropriate things are being looked at so that the board really should be really have an assurance function. That's what the board's role is. So it will be looking at various consolidated measures.

 

00:33:07:16 - 00:33:45:04

Virginia

It needs to understand what are the outlaws in these measures. And then it needs to understand what is being done about the outliers is the continuous improvement pace. And the board needs to be satisfied that the insights that have been flowing up to the board are being acted on, and that the loop is being closed somewhere, because I think a real trap, I think for, care organisations is that especially when you are financially constrained, which is, let's face it, much of the time you can end up admiring problems as they come to the board month after month.

 

00:33:45:07 - 00:34:26:21

Virginia

Because there may be a reason that, you know, financial constraint, workforce constraints, you might have high agency use for various reasons. You think back during, during the pandemic and in the time coming of pandemic. So the board has to guard against, complacency, that sort of a being, a being passive, I think. So that's why I think always the board should be interrogating not not just the information that that's there, but is that the information we really need to assure ourselves that the care that is being delivered possibly seven management lies below us, is actually high quality care and is actually meeting people's needs and is actually allowing them to flourish

 

00:34:26:21 - 00:34:52:28

Virginia

in their lives. So that is a work in progress for every board. And it is it is the work of the board. I think we've seen that in significant legal cases, the board must say that is not what I want to see. But to do that, you really have to understand your operation really well. And I think one of the key aspects for me in understanding the organisations I've been part of, site visits for directors, and I think this is absolutely critical now.

 

00:34:52:28 - 00:35:16:10

Virginia

In fact, it can't be understated. I think the importance of site visits, you you get to observe and see a model of care in action, whether it's in a health service, aged care or a residential aged care. You might be going along to a home care visit. So you get to see how your staff are interact to get a feel for the culture of various different sites.

 

00:35:16:13 - 00:35:36:27

Virginia

And it also just helps you understand what the risks are, and it helps you understand how hard the work is at times. And I think site visits is something now that I think most directors have come to understand. Absolutely critical, you need a site visit program and you need to have objectives. You can't just, you know, you can't just say to management, organise the site visits.

 

00:35:36:27 - 00:35:55:20

Virginia

The board needs to take responsibility for what is it that we want to get out of this? Do we want to have lunch with residents? Do we want to experience the dining experience as a resident would? Some of my colleagues I know, in other organisations would say I always stay the night in a facility just to see what is it really like here?

 

00:35:55:23 - 00:36:05:14

Virginia

So I think that's been a real shift that I've seen in 15 years of board work. I think that site visits are now absolutely integral to understanding clinical governance.

 

00:36:05:16 - 00:36:35:01

Martin

Let me tell you why a chief executive wants site visits to occur, because inevitably in human services, part of your clinical governance is facing up to the events that, adverse and the things that do go wrong. The context for how these events occurs is so important. And if you've not been into a disability home, a childcare centre or an aged care centre, you don't have that appreciation.

 

00:36:35:01 - 00:37:04:16

Martin

You haven't had the chat with a disability support worker who perhaps, used to be a butcher or hairdresser, and they've made that career shift and thank goodness that they have. And it explains the context of some of that workforce. I've got, on my board, some extremes, and I'll namecheck some of my directors without naming them, but one tells me that the board of Walmart expects business proposals to be written in a single page.

 

00:37:04:16 - 00:37:37:28

Martin

$100 million decision has to be concise enough to be in a single page. Another director bringing the experience out of the financial sector, that needs several hundred pages of financial analysis to get to a decision. I think that word assurance that you've used, Virginia, the board needs to assure themselves through the information they receive, through them turning up in services, but really importantly, having that direct connection with the consumer, whatever form that takes.

 

00:37:38:01 - 00:38:13:27

Martin

We have our consumer representative board, attend every second board meeting unfiltered on agenda. Talk about whatever you like. Directors on my board visit services before every meeting. It's part of the KPI, and it shapes the expectation of how to read a board, paper or a proposition, particularly the more challenging ones when we're dealing with how to remedy adverse events, or making decisions about financial viability that are going to impact people.

 

00:38:13:29 - 00:38:56:19

Martin

But if you return to those central tenants as to what is good clinical governance, as a director, do you see the evidence? Do you have guides as to how services are to be delivered? Do you have monitoring and reporting for when things go wrong, and is the consumer voice part of that? If all of that is on display, you are seeing as a director the right types of information to satisfy itself, providing that there is a strong compliance and reporting system for those adverse events, not just to the regulator, but those regular phone calls between chief executive and chair or that reporting up to the board through the risk tolerances in your risk framework

 

00:38:56:21 - 00:39:02:25

Martin

to say these events have occurred. Here's how we deal with them. Here's how we rectify them. If that's on show, you're in good shape.

 

00:39:02:28 - 00:39:41:10

Phil

I wanted to pick up on another word that Virginia used the interrogating on. I'm sure you didn't mean it in this perspective. Virginia. But interrogation of the executive team. I've seen a bit of friction happen between executive teams and boards. I've raced on top of it. Almost. Don't you trust this anymore? Kind of nature, as boards have had to delve further, perhaps into the operations than they may have previously as a chief executive, you obviously dealing with that on an ongoing basis.

 

00:39:41:12 - 00:39:49:26

Phil

What do you get the sense of the right level of interrogation, of you as a chief executive now?

 

00:39:49:28 - 00:40:17:21

Martin

Well, I've been a chief executive for 20 years, and simultaneously a board director, for that length of time. And I've changed my view. I was once quite affronted when a board director would challenge something that I'd said, and now I run towards it and expect it, because I understand. And I think good executives, experienced executives in particular, understand the different roles the role of the director is to interrogate.

 

00:40:17:21 - 00:40:38:12

Martin

It's the right word. There's a set of duties that I understand a director has and a set of duties that, as an officer of the company, a chief executive has. I think if you're new to it, get used to it because it's the job and it's not personal. It's about fulfilling the best interests of the corporation or the enterprise.

 

00:40:38:14 - 00:41:20:03

Martin

And actually the director who interrogates a chief executive is doing the chief executive a favour because they are aiding management in making the best possible decisions. My management team and I do regularly think, how is the director, individual director and directors collectively going to play out in this particular situation? A former colleague of both of us, I don't mind naming Michael Stanford told me once when he's writing a board paper, he writes his paper with all of the directors who are going to read it in mind, and he checks out the interest of so-and-so is X, the interest of someone else's.

 

00:41:20:03 - 00:41:53:29

Martin

Why have I address that when I'm preparing my paper? And I don't mind that little tip that Michael Stanford gave to me 20 years ago, I still carry with me today, and it means that I don't feel interrogated. And any chief executive who is defensive. The board should be digging further. Why is there the need to be defensive management and board ultimately on the same team working for the same objective and the strength of the different roles is their contribution to the best interests of the enterprise.

 

00:41:54:05 - 00:41:57:18

Phil

And that that governance is a team game is just critical, right?

 

00:41:57:18 - 00:42:28:24

Virginia

Yeah, I think that's right. I've been thinking about really the shift in terms of community expectations, scrutiny on organisations and all things we've discussed really today, all of that. I think, has meant that the board, CEO, board, executive relationship really has to be more even more one of partnership, I think, than would traditionally be conceptualised. So I think the best executive teams, the best CEOs, welcome respectful challenge because they like to be tested on their ideas, on their thinking.

 

00:42:28:24 - 00:42:56:14

Virginia

So, I found that, the challenge, the challenge or the interrogation of the board is entirely of the executive is entirely appropriate. And really, the effectiveness depends on the sense of mutual trust between the board and the executive CEO. That is even more important, I think, in a, in a care organisation and the high degree of trust that is required, that is the key ingredients.

 

00:42:56:16 - 00:43:16:03

Virginia

If you trust each other, then you can challenge each other respectfully and effectively. And I think that really in the climate that we're in, that sense of working together has to be really quite, evident, to, to everyone, to both the board and to the executive.

 

00:43:16:06 - 00:43:43:11

Phil

We're getting close to time, but I did want to touch on measurement before we finish today, because at the end of the day, we've got to know that we're making a difference to people's lives. Right. And yet my observation is many organisations are struggling to properly measure the right things. And some of them are, intangible. Who wants to have a crack at measurement?

 

00:43:43:18 - 00:44:12:18

Martin

Activity is really easy. You can count, but outcomes very different. The experience, I think, that we can learn from hospitals. Hospitals have outcome measures about the efficacy of their services. You know, if a hospital admission has been successful, you know, if a surgical episode has been successful today, we don't have those same measures for disability care in particular.

 

00:44:12:20 - 00:44:48:26

Martin

And I think in childcare and aged care, we have different expectations about what an outcome might be beyond we kept people safe, said. And their welfare was in check. We'd expect, now that we have child educators in childcare to have really concrete measures about meeting the learning milestones in disability care. We've got that opportunity to define what those measures of success I don't like just being measured on my safety outcomes.

 

00:44:48:26 - 00:45:18:22

Martin

And that's as mature as our regulatory standards are. So some of us in the disability sector, actively designing what are the outcomes around person centred care? What are the outcomes for supported decision making? How do we ensure that the consumer voice, where the consumer's voice is challenged because of their disability, that we ensure we are delivering the services that they choose in the way they choose.

 

00:45:18:25 - 00:45:43:04

Martin

So it's not yet clear there's not a universal agreement. That gives us an answer. But I think if we look to the hospital sector that has needed to work it out years before, we should be expecting over time the same across aged care, childcare and disability care, different outcomes, obviously, but that same outcomes framework that is not just counting activity.

 

00:45:43:06 - 00:45:44:08

Martin

 

 

00:45:44:11 - 00:46:04:29

Virginia

Yeah I think that's right. I think there's an increasing maturity in aged care in surveys like resident. Oh client surveys of and also you know net promoter schools. That's becoming more common. I think there's still some way to go in terms of patient outcomes in the hospital system. So, I think that this is an area where we could all do a lot more work.

 

00:46:04:29 - 00:46:25:10

Virginia

And often, of course, what the patient's idea of an excellent outcome may be different from the surgeons and also as you as you would know, man. But I do think that it's an area where we are getting better at asking residents, are you happy? Are you lonely? Do you have social connections? Because these are the real test.

 

00:46:25:13 - 00:46:46:07

Virginia

This is why, you know, families look to us and trust us. Is that the parents or the family members or their loved ones will be happy in our care, that they will feel safe, that they will have social connection. So I do think that there are, many improvements in towards surveying and understanding residents, but that a long way to go, I think, for our sector.

 

00:46:46:09 - 00:47:10:29

Phil

And it will be fascinating in a decade's time to look back and see where some of these subsectors have gotten to in terms of their, ability to measure, and report on the outcomes overdue. It's been great chatting today. It's such a fascinating area of our society. Yes, it is the care economy, but it's bigger than that.

 

00:47:11:06 - 00:47:20:21

Phil

As I said in the intro, it's about looking after our loved ones. And thank you for doing the roles that you do. And thanks for having a wonderful chat today. Cheers.

 

00:47:20:29 - 00:47:25:13

Martin

Thank you. Feel nice. Welcome.