Historic governance overhaul to strengthen future leadership

After receiving overwhelming support from its membership, with 82.6 per cent of votes in favour, the College has an updated Constitution to strengthen financial and risk management as it navigates the complexities of the modern governance environment.

 

Fellows voted from 17 September to 18 October 2024 on proposed changes that would provide for the establishment of a skills-based, profession-led governance Board leaving Council to carry out the core College business. A two-thirds majority was required to adopt the new RACS Constitution.

 

Professor Owen Ung, RACS vice president and chair of the College’s Governance Committee, said the passing of these constitutional updates is a testament to the power of collaboration and what can be achieved when stakeholders from across our network come together for a common purpose.

 

“It is heartening to see the unity of feeling that a strong College benefits everyone involved - our members, our patients, and the wider healthcare community."

Since its founding in 1927, the College has played a pivotal role in shaping surgical standards, education, and professionalism in Australia and Aotearoa New Zealand. While it continues to be at the forefront of surgical leadership, it became increasingly clear in recent years that the structure of the College was no longer fit-for-purpose.

 

Updates to the Constitution were designed to modernise the governance of the College and allows for the establishment of a skills-based, profession-led Board.

 

These are the important elements to note:

• There is no change to Council. Council continues to be foremost in member representation with the core functions and business of the College continuing to be led by Council as members’ elected representation.
• The president continues to lead our organisation.
• Council’s leadership is strengthened by a governance Board. The Board will carry out the fiduciary responsibilities of finance, audit, risk and high-level governance.
• The chair of the Board will always be a Fellow. The president and vice president are not excluded from the role, provided sufficient tenure can be assured.
• The Board will be profession-led. There will be a majority of Fellows on the Board at all times.
• The Board will include representation from both Australia and Aotearoa New Zealand.
• Fellow directors of the Board will be elected from the membership by members or may be appointed from Council. A nominations committee of Council will consider all applicants against prerequisite skills and shortlist candidates.

 

You can view the new RACS Constitution (PDF 507.18KB).

Now the updated Constitution is in place, the focus is on establishing the skills-based governance Board. 

We have formed a transition Board and are working to create a formal nominations committee. We are also developing a skills matrix by which the nominations committee can assess suitable candidates for the Board obtained through expressions of interest. 

Governance reform won’t end with the establishment of the Board. We recognise that greater representation, inclusivity, and connection are crucial for the College. We are committed to revisiting Council regulations to better embed representation ensuring a strong voice for groups from across the membership.   

What exactly has changed in the Constitution?
The updated Constitution allows us to establish a skills-based Board. Without changes to the Constitution, we were not legally able to do this. We encourage you to read the Register of Changes (PDF 129.68KB) to view specific changes and the Explanatory memorandum (PDF 170.79KB) for a summary of the updates.

Why was there a need for a change to the College's governance structure?
The new structure was workshopped, debated, evaluated and deemed necessary by successive Councils in order to modernise and safeguard the organisation in an increasingly complex regulatory and financial environment.

An independent review of the causes of the recent challenging financial situation at RACS confirmed the critical importance of having a skills-based governance Board made up of independent external persons with the requisite experience in finance, governance and management. As such, the RACS Council proposed a new structure to address these shortcomings.

Where can members view the changes in full?
We invite you to view the changes in full here (PDF 129.68KB). You may also view the new Constitution (PDF 507.18KB), as well as the Explanatory memorandum (PDF 170.79KB) for a summary of the updates.

What does the Board structure entail?
The Board is a small skills-based governance structure, which will focus on the financial, audit and risk and legal responsibilities of the College. It is contemporaneous and recommended for large organisations such as RACS. The Board will carry the fiduciary responsibilities of finance, audit, risk and high-level governance, leaving to Council the core business of guiding RACS and advocating for surgical standards, professionalism and education.

Who will the Board be accountable to?
The Board will ultimately be accountable to you, the members. Its role is to act in the interests of the College and its members in the long term. Specifically, the Board will be informed by Council to ensure that our organisation continues to be profession-led, member represented and to act in the interests of Fellows and the profession.

Will the current President be the new chair?
This is possible under the new Constitution but not mandated. The chair however will always be a Fellow appointed by the Board.

How will directors be appointed to the Board?
Fellow director (Board) applicants who meet predetermined skills criteria will be judged and approved by a nominations committee of Council and then elected by the membership or may be appointed from Council if they have been through the Council election pathway.

In transition, the independent Recovery Committee will nominate the first external non-surgeon directors to the Board. In subsequent years, the Board will have responsibility for selecting skills-based non-executive directors.

Directors will be able to serve for a maximum of three consecutive three-year terms.

What happens to the role of Council?
Members will continue to elect Councillors in line with the annual election process. The core functions of Council, including guiding strategy and policy across standards, research, advocacy, education and training on behalf of the surgical profession, will remain unchanged. Council will continue to be led by the President and will make recommendations to the Board for consideration through a legal and financial lens.

What changes will occur within Council?
None. The Council structure will remain unchanged except for the functions of finance, audit, risk and oversight of executive management.

What happens to the Recovery Committee?
The Recovery Committee, with its specific expertise, has performed a crucial function in turning around our financial situation and putting the College on a sustainable pathway. Now the ballot has concluded, its accountabilities will be handed over to the new Board.

Will Board members be paid?
No, directors will not be directly remunerated. They will be provided an allowance and reasonable expenses they may incur.

The proposed changes to the Constitution allow for the establishment of a skills-based, profession-led Board. What does “skills-based” mean?
“Skills-based” means the membership of the Board will represent a mixture of the skills and experience that will make for effective decision-making and allow it to meet the obligations and expectations of a modern governing board of directors. These skills include finance, legal/governance, information technology and cyber security.

What is the proposed budget for running the new Board?
The budget is modest and not at the level of a corporate industry board. Members will not be directly remunerated and the main cost will be reimbursement of expenses. It is unlikely the cost will be any greater than under the current model with the Recovery Committee. 

How can Fellows ask questions about the new Constitution?
We want to hear from our Fellows and your questions are always welcome. Please email them to: [email protected].