Establishing a Code of Ethics
Successful boards are fueled by a clear understanding of member roles and responsibilities. Their trustees are unified by a shared commitment to fulfilling those obligations. Yet, many companies struggle to keep guiding principles at the forefront of their boards’ work.
Marc A. Scorca, president and CEO of OPERA America, sat down with Rob Vineberg, trustee and past chair, and Larry Desrochers, general director and CEO, of Manitoba Opera, to learn how one company found a solution by establishing a code of ethics.
Marc A. Scorca: At the National Trustee Forum, you shared some really good procedures that you put into place for encouraging respectful conduct at Manitoba Opera. Tell me what you developed.
Rob Vineberg: Seven years ago, we implemented a formal code of ethics policy for our board of trustees. It runs just over two pages and articulates the kind of things that you would expect of a board member: to fulfill fiduciary obligations; to understand the company and the founding documents; to be able to carry out the role; to conduct oneself in a professional, courteous and respectful manner; to always act in good faith; to disclose any actual or potential conflicts of interest; and to respect confidentiality.
We also ask board members to operate in a spirit of “cabinet solidarity.” In other words, you can challenge and discuss issues at the board level, but once a decision is made, it is expected that all board members will support that decision. The alternative is to resign from the board if you can’t abide by the direction the board has taken.
Finally, we want to ensure that board members treat staff and volunteers in a respectful manner, as well, and that at the end of their term, board members are willing to conduct an exit interview so we can learn from their experience and build on that.
Marc: What led to the development of this code of ethics?
Rob: It was an experience that my wife and I had at our condominium. While my wife was president of the condo corporation, there was a major repair proposal that was under consideration. The condominium board voted unanimously in favor of it. But following the vote, two board members started talking behind everyone else’s back to try to derail the proposal at the general meeting. They were called out and the proposal was approved, but in retrospect we didn’t want to see that happen again. So, the condo corporation had its lawyer develop a code of ethics.
From this experience, it seemed to me that we needed to be proactive at Manitoba Opera in anticipating what challenges the organization might have. I brought the idea of developing a code of ethics to the opera board and everyone thought it was a good one.
Marc: Who developed this code?
Larry Desrochers: It was our governance committee, and the chair at the time was a lawyer (who is now a justice in Manitoba’s equivalent of the Supreme Court). He worked with me and another board member to develop a draft early in 2011. It was approved by the board in June 2011 and has been in place ever since.
Rob: Yes, it was done internally. No consultants, just smart and concerned citizens. And there were, and still are now, good examples of codes of conduct that we could draw on.
Marc: Was there any opposition to this? Did any board members feel as if it was becoming prescriptive or that you were somehow parenting them in their board duties?
Rob: No, I don’t think there was any pushback at the time.
Marc: Have you ever had to invoke the code of ethics with a board member? Have you ever had to hold it up and say, “Excuse me, Mr. Smith, but point 3 of our code of ethics says…”?
Rob: Not in an explicit fashion. Since we adopted the code, we’ve had two experiences, a few years apart, with board members objecting to the approval of budgets with soft revenue projections. They were just so uncomfortable with this that they chose to submit their resignations. They didn’t reference the code explicitly, but their behavior was consistent with what it directed. So, I think it’s had a positive impact.
Marc: How do you introduce the code to new board members? Is it part of the cultivation or the orientation?
Larry: We include the code of ethics as part of a package we prepare at the recruitment stage for prospective board members, alongside copies of our annual reports, bylaws, mission, vision and values statements, standing policies, and our board expectations document. Prior to bringing a name forward to the board for a vote, another board member and I will meet with each board prospect to confirm the material has been read and understood.
Rob: For someone who is considering joining the board, there is a level of confidence to be derived from an organization that has a good range of governance policies and supporting documents in place. It says to them that there is a structure within which they will be working. So, I consider the code of ethics to be a really important part of our recruitment package.
And we take it a step further, too. At the first board meeting after new board members are approved, all board members — new and old — are required to sign (and re-sign) the code of ethics, to remind them of the fact that they have committed to upholding these values.
Marc: Larry, I would imagine that although you haven’t invoked it, it must give you a sense of comfort to know that these principles have been stated up front, and that you have a safety net should anything happen.
Larry: I guess it gives me a sense of comfort, although I don’t think of it that way. I think of it as what we are doing to strengthen the institution and to build the institution for those people who are going to come after us. When I came to Manitoba Opera in 2000, there were only six board members and the only governing document was the bylaws. So, we spent time over the years to put into place governance practices for the board, and this document is one of them.
Marc: Given the #MeToo movement, I know that many opera company trustees are looking to adopt a code of ethics for their employees. Do you have an equivalent policy for staff and visiting artists?
Larry: The interesting thing is that our board policy didn’t come out of a situation of crisis. While it was a crisis for another organization (Rob’s condo board), we were proactive in taking their negative experience and extrapolating it to our own organization. We were able to see that this could happen to us and we should have something in place.
There was always the intention to develop a similar code of ethics for staff, although we never quite got around to doing it. Taking a lesson once again from what we’ve seen at other organizations, though, we’ve just revised and updated our human resources policy. We’ve included language in that about the ethical conduct we expect from the people working with the company, either long-term or short-term.
The way I see it, if there ever was a moment to be proactive, now is the time.
This article was published in the Spring/Summer 2018 issue of Across the Board, a publication of OPERA America for opera company trustees.