We’ve been talking about the role of policies as well as guidelines for writing board policies.  One important issue worth mentioning is the difference between a policy and a procedure.  This question has come up a couple of times during my time on committees.  Understanding this difference will help when writing policies as they will be more effective and result in the outcomes that were intended.

What is a policy?

The role of a policy is to provide a framework or guidelines about why it is needed and what needs to be done to achieve the intent and objectives of the policy.  Making sure this is clear and concise is the main critical issue.  If there is any ambiguity it can lead to confusion.  Some board members might believe the policy has been adhered to while others don’t.

For example, Robin Hood could well have needed a policy on when or when not to take from the rich.  He was selective about whose money he took.  To make sure that his Merry Men followed his lead he could have written a policy document spelling it out for them.

What is a procedure?

The role of the procedure is to explain how the actions needing to be done to achieve the intent and objectives of the policy. The need for a procedure springs out of the policy.  The procedure also needs to be clear, concise and specifically outline the actual steps that need to be undertaken.  It may also detail the sequence of steps, who can or cannot complete the steps, what documents may need to be completed and when they need to be completed or submitted to for approval.

Going back to the Robin Hood example, the Merry Men now know which rich people they should target.  The procedures tell them how it should be done. It is in step by step form so they know what to do from the moment they stop the carriage to the moment they disappear into the forest.

Another point of distinction between a board policy and a procedure is that the board policy is written and monitored by the board whereas the procedure is written and monitored by the management of the organisation. 

For a board to ensure the policies are being adhered and the objectives have been met there should be a reporting process in place. The process should be prepared by management and show how the objectives of the board policy have been achieved.  Having key performance indicators linked to board policies is another method to monitor compliance and provide evidence that compliance has been met.

Work out your policies and the procedures will be born from them.