School Governance 101

Creating Opportunities and Overcoming Challenges

Published: September 28, 2023

Read Time: 14 minutes

School governance
  • Schools face a number of challenges — and so do the boards that govern them. While concern about some of these challenges has fluctuated since 2014, high salary costs and school fees as well as compliance issues have remained top priorities for governors for almost a decade.

  • Twelve key characteristics of effective school boards define healthy school governance and present opportunities to improve at every turn. By adopting most or all of these characteristics, schools can mitigate many of the issues they face today.

  • School boards that pay close attention to their duties and obligations create better outcomes for students, school staff and themselves. Not every school gets it right, but when they do, it’s usually because the board made a conscious decision to ensure these outcomes.

When do schools fail? Failure doesn’t come down to educational issues, but rather governance and business structures or financial management failures

But school boards often make the same mistake of focusing solely on the academic side instead of looking at governance practices and processes. While educational programs are undoubtedly important, the number of school failures due to poor curricula pales in comparison to failures due to poor governance and financial management.

Survey data from the independent school sector management level shows some almost-unchanged priorities since 2014. But it is possible to establish healthy school governance — as evidenced by a number of core characteristics associated with effective school boards. There’s a definitive wrong way to go about governance, but also a clear right way.

The biggest challenges facing schools

A 2022 Bursars Forum study found that school business managers and CFOs have consistently reported that keeping school fees down and schools affordable has been the number-one priority since 2014. Even double-income families have found managing personal finances persistently harder, leading to a growth in requested grandparental support. Academic expectations are rising, and as schools feel it necessary to deliver, school fees are rising, too. At the same time, government funding isn’t keeping pace with increasing costs.

Finding quality teachers — and often board members — has also been a pressing concern. School boards without quality board members put the whole organisation at risk. To limit this risk, some school governors are establishing committees that search for and bring in nominees for board membership. Sustainably managing school fees is a huge challenge that only strong boards can effectively tackle.

Rising salary costs and compliance issues are of even greater concern than finding high-quality staff members. These are issues related to the Australian Tax Office (ATO), workplace health and safety (WHS) laws, the Australian Charities and Not-for-profits Commission (ACNC) and the Department of Education.

There are no magic bullets to solve these problems, but networking to find solutions together is a helpful starting point.

Healthy governance: Finding a pathway forward

The distinction between governance and management might not be immediately clear, but it is important for board members to understand:

  • Management is reactive, administrative and task- and detail-oriented. It seeks to establish and carry out management policy based on the agenda. Management is focused on ‘how’ and concerns itself with the past as it informs the present.

  • Governance is proactive and vision-oriented, initiating and setting the agenda for management to follow. Predictably, it seeks to establish and monitor governance policy — with a focus on ‘what,’ ‘who’ and ‘why.’ Governance looks to the present as it informs the future.

Vision statements are common for schools but should be thoroughly owned by the board and not fed to it by management. The board is appointed by an organisation’s moral owners to ensure it acts in accordance with its purpose.

Moral owners are company or association members who attend annual general meetings (AGMs). Although moral owners aren’t involved in daily governance, they are, nevertheless, a critical part of the organisation, and AGMs foster close relationships and communication between moral owners and the board.

There may be an overlap in roles if some individuals serve as both board member and moral owner. Both of these categories are distinct from personnel — including teaching and other staff members — and beneficiaries: students and their families. But board members, moral owners, personnel and beneficiaries alike all come together around shared values, vision and purpose — without which schools often fail. Equally, organisations without enough moral owners experience significantly greater challenges.

More frequent performance appraisals — for both the board and staff members — help identify weaknesses, communication breakdowns or misalignment of expectations. Community surveys for students, staff and the board also help identify organisational perception: Is it meeting and serving the purpose the stakeholders believe it should be?

The 12 characteristics of an effective school board

Dr. Robert Andringa (CMA) highlighted 12 characteristics of effective boards, which serve as an invaluable guide to practical school governance:

  1. There is a clear understanding of respective board and staff roles, which means the board engages in governance and not management. Failure to understand this leads to organisational problems.

  2. The board has a governance focus, which means looking forward with an obligation to ensure things are happening correctly today and avoiding organisational slowdowns and folds in the process.

  3. Board members must understand their three roles as governors, volunteers and implementers. Respectively, these roles ask them to hold management accountable, (often) not be paid and help achieve the vision rather than dealing with daily management issues.

  4. The board must be clear about and link with its stakeholders and moral owners in terms of the school’s purpose, activities and priorities, all of which must be consistent with what moral owners require.

  5. The board must adopt clear mission goals, ensuring clarity for school principals and management about organisational priorities, and should not compete with management.

  6. The school principal (or CEO, or executive) is the one agent for boards who is responsible for achieving the goals within the parameters the board sets. Board reports should be formatted in a way that complements this end and keeps CEOs on track and accountable.

  7. The board should have a clear set of policies collated in a single document explaining the functions of the board, which is regularly reviewed and accessible on a board portal.

  8. Board chairs critically ensure effective boards by “managing” them or administrating with support from the principal.

  9. Board committees serve the board’s (not the staff’s) needs and should very rarely be delegated any decision-making responsibility — only in exceptional circumstances and in a limited capacity. They are not public communications teams.

  10. Board meetings should be well planned with advanced materials provided (at least a week prior), good agendas, clear results and an opportunity for the board to get to know each other better.

  11. Board members should be selected and well orientated based on thought-out criteria and with diverse skills, ages and genders to make them as effective as possible.

  12. The board accepts responsibility for improving itself, not looking to company or association members or executives (i.e., principals) to help or educate it in best-practice governance.

When school boards apply these principles, effective and high-quality school governance is sure to follow.

How things go wrong — and why they go right

If school boards fail to ensure that they’re adopting the right principles for good governance, disaster may ensue.

One K-12 school in northern New South Wales (NSW) had 300 students, but its false census returns (for three years) confirmed 420. It got staffing levels for 420 students and increased but disproportionate cash flow. This was all thanks to an unengaged board that was responsible for improper financial reporting, weak staff checks and a lack of award compliance.

The board only met twice a year and was minimally accountable, with poor employment contracts and failure to pay staff their entitlements. With no checks and balances in place, the school ultimately ended up owing the Commonwealth and the state $2 million. It couldn’t pay and had to close, and the principal was jailed for three years.

This could all have been avoided with:

  • An involved board;
  • An appropriately scrutinising finance committee;
  • A treasurer obtaining proper sign-off; and
  • An external auditor with access and directly reporting to the board (not the business manager).

Even with good communities behind them, schools staffed by incompetent, overloaded or inadequately resourced administrative teams won’t last long, unfortunately.

Another K-12 school with 850 students based in Adelaide, South Australia, benefited from a very engaged board with a clear vision and mission, a strong leadership team, reasonable finances and a good student waiting list. As a result, they managed to purchase land and buildings with a replacement value of $66 million dollars alone for just $8 million. Thanks to detailed cash flow projections and a long-range financial masterplan, the school managed to double its site size (with spare buildings) and grow enrolments to 1,250 in just two years.

These two lessons serve to show how important governance is to schools’ functioning. With a weak board in place, schools can literally shut down, with individuals bankrupted or imprisoned. With the right board — demonstrating the twelve characteristics of good governance — schools can deservedly grow towards even improbable success, serving both local communities and wider society.

What is local school governance?

Local school governance refers to the organisational structure, decision-making processes, and oversight model for schools at the district or individual building level. This governance usually comes in the form of a school board comprised of elected or appointed members from that local community. These boards are responsible for establishing policies, setting and overseeing the budget, evaluating and hiring the superintendent or principal, and helping to shape the overall strategic vision and direction for the school or district. School boards create a mechanism for local governance that keeps the school connected to and reflective of its community.

What is the difference between school governance and management?

There is an important distinction between governance and management within a school organisational structure. Governance refers to the big-picture oversight, vision setting, and high-level policy-making work of the school board. This includes budgets, hiring, evaluation, and strategic planning. Management on the other hand encompasses the day-to-day administrative tasks and operations of the school. This is the role of the principal/superintendent and other staff members who implement the policies and plans established by the board through governance. There is intentional separation between governance and management. The board governs and provides direction, while the administrators and staff manage the execution and details of that vision.

What is the most important responsibility of a school board?

Of all the responsibilities school boards have, oversight of finances and adherence to the annual budget is arguably one of the most critical. Research into school closures and other major issues consistently points to poor financial management and lack of budget control as one of the central causes. School boards that do not prioritize budgeting and financial planning put their schools at serious risk of major problems. Effective school boards make fiscal management and budget monitoring a centerpiece of their governance model, establishing clear financial policies and holding administrators accountable for aligning with the approved budget.

Is governance same as management?

No, school governance and management are distinct roles and responsibilities. The board practices governance through high-level oversight and vision-setting work like policymaking, budget approval, hiring/firing of the administrator, and strategic planning for the direction of the school. These are big picture governance tasks. Administration and staff handle management via day-to-day tasks like scheduling, teaching, purchasing, student issues, and generally operating the school based on the board's governance framework. Management is the hands-on work of running the school based on the plans and policies set by the board. Governance and management work in tandem but have clear separation.

What is the role of school board?

A school board's core role is to provide strategic oversight, vision, and direction for the school through essential functions like adopting policies, overseeing and approving the budget, hiring and evaluating the superintendent or principal, connecting with the community, and setting clear goals and priorities for the school. Essentially, they govern the school through these big-picture responsibilities that set the direction, while empowering the administrators and staff to handle the day-to-day management needed to operate the school. School boards govern, administrators and staff manage daily operations based on that governance framework.

How much do school board members get paid?

The vast majority of school board members serve as volunteers without pay. Some receive a modest stipend in the range of $50 - $150 per meeting, but serving on a school board is still considered volunteer community service rather than a paid position. Most who seek school board membership do so out of civic interest and duty, with expectations that they will volunteer their time governing the school. While not prohibited, direct salaries for school board members are rare. This helps maintain the notion of altruistic community service central to the role.

Is the principal a member of the school board?

Typically the school principal is not an official voting member of the board, since the board oversees and evaluates the principal. Instead, the principal serves in an advisory and informational role, providing critical updates and reports to the board that help inform their policymaking and oversight. They may attend board meetings and offer perspectives, but usually do not have an official vote. Some boards may allow the principal to be a non-voting member, but they are generally not voting participants since the board oversees them.

Do school board trustees get paid?

Most who serve as school board trustees are unpaid volunteers motivated by civic duty rather than direct compensation. Some districts offer a modest stipend for attending meetings or reimburse expenses, but there is no expectation or model of trustees being directly compensated for their governance role like an employee. The intention of the board is community service and oversight versus shareholder profit. Paying board members could create perception issues around motivations.

How many people can be on a school board?

School boards can vary in size, but commonly have between 5-10 members. The exact number is usually dictated by local policies, regulations, and custom. Larger districts may opt for more members to represent their expansive areas, while smaller schools may need fewer. There are common minimums and maximums that boards must abide by based on their specific state and district rules. The size should allow adequate representation without being too unwieldy for efficient governance and decision-making during meetings.

How many meetings should a board have?

Most school boards meet on a monthly basis, which allows for oversight and input on issues as they come up. Some may meet a bit less frequently such as six times a year, while others require bi-monthly meetings or more depending on circumstances. Ten to twelve regular meetings over the course of the academic year is fairly standard practice. This monthly cadence enables the board to be regularly informed and involved without overstepping into excessive oversight or full management of daily operations, which should be handled by administrators.

How can board committees help make a school board more effective?

Board committees can improve school board effectiveness by focusing on specific areas relevant to governance that require deeper study and expertise. Committees allow a subset of members to dedicate time and gain knowledge in finances, facilities, curriculum, or other areas, then report back key findings and recommendations to the full board. This enables the full board to benefit from the concentrated insight of committees without having to become experts in every area themselves. Committees should serve the board's governance needs primarily, not school management.

What should a school board's relationship with the principal be?

The school principal serves as the board's key liaison and administrative partner, but the board maintains oversight. An effective relationship recognizes the principal as the top manager who oversees day-to-day operations based on the board's governance vision and policies. The principal informs the board's decisions by providing critical updates, data, and insights. In turn, the board sets goals, parameters, and expectations for the principal to carry out. They work collaboratively, but the board governs and the principal manages. Trust and open communication are essential.

What are some best practices for selecting effective board members?

Best practices include defining clear criteria for skills and experience needed on the board based on strategic goals, then actively recruiting qualified candidates to serve. Seeking diverse board members in terms of occupations, demographics, and viewpoints results in better decisions informed by different perspectives. A nominations committee can identify and vet potential members. Interviews and recommendations help ensure candidate qualifications before appointment or election. Periodic self-evaluations identify gaps to fill. Casting a wide net for board members yields better results.

Further Resources

Reviewing Your Constitution – Food for Thought

Fulfilling Your Obligations as a Not-for-profit Director

Board Perspectives: Key Skills for Making Constructive Contributions

Good Governance in remote Australia – it’s closer than you think

This article was based on a presentation given by Resolve Consulting senior consultant Craig Harvey. Join Boardwise to watch Craig’s presentation and improve your school board’s governance skills and knowledge.



Better Boards connects the leaders of Australasian non-profit organisations to the knowledge and networks necessary to grow and develop their leadership skills and build a strong governance framework for their organisation.

Found this article useful or informative?

Join 5,000+ not-for-profit & for-purpose directors receiving the latest insights on governance and leadership.

Receive a free e-book on improving your board decisions when you subscribe.

Unsubscribe anytime. We care about your privacy - read our Privacy Policy .