Does It Matter What Others Think?

For the first time housing associations in Wales are able to pay board members. One might say this is long overdue but from my time working in Wales I know it will divide the sector. Some will welcome the opportunity believing it will help recruit and reward high calibre board members, while others will worry about the voluntary and social ethos of the housing movement being undermined by paid board membership.

There is no right or wrong answer. Every board and every housing association will have its own view and will have to make up its own mind whether to pay or not. This can now be added to the list of other ʻdifficultʼ board decisions such as rent increases and chief executive remuneration where a whole raft of stakeholders, the regulator and the media will have a view on the boardʼs decision which might well be unsupportive. Indeed you can add to that most decisions by the board to develop new social housing, something not often universally welcomed by existing communities.

Boards are used to making difficult decisions but rarely is adequate thought given to how these decisions might affect the organisationʼs reputation.

Does it matter what others think? Of course it does. Warren Buffett once observed: “It takes 20 years to build a reputation and five minutes to ruin it.”

Should boards not make decisions for fear of upsetting others? Absolutely not. But clear thought needs to be given to how these decisions are going to be explained to various stakeholders.

This will be your public relations strategy. Not glossy brochures full of new, state- of-the-art homes you’ve built, or newsletters crammed with pictures of your latest award successes, but clear and transparent reasons for having taken a particular decision that address the concerns of each stakeholder. These will have been pre- prepared in advance and can be published proactively if appropriate or in response to media enquiries or complaints if necessary.

And for this to happen boards need to add ‘reputational risk’ to their strategic risk maps and consider how each of their decisions will be explained and received outside of the boardroom. Not only will this lead to better public relations but it will lead to better decision making and might just prevent you from having to defend the indefensible.