Involve boards of VWOs in talent management

AS the social fabric of Singapore becomes more complex amid the twin challenges of an ageing population and managing economic growth, there is an increasingly pressing need for the social service sector to grow in order to respond to the needs of society more effectively.

There are currently more than 450 voluntary welfare organisations (VWOs) in Singapore, contributing to a substantial source of employment and healthy demand for human capital. To position the social service sector as a desirable career choice, the National Council of Social Service (NCSS) has released salary guidelines for the sector. While compensation is one of the key drivers, it takes more than that to sustain talent growth in the social services sector - and boards of VWOs can play a significant role.

The signing of a memorandum of understanding between the Social Service Institute and the Singapore Institute of Directors last year to develop a flagship training programme for board directors of the non-profit and social service sector underscores the importance of boards in providing advice and guidance to their VWOs.

Like the boards in the corporate world, VWO boards need to have oversight of all business-critical risks. While fiscal and regulatory risks may easily dominate the boardroom agenda, risks related to human capital should not be underestimated. After all, an organisation is often only as good as its people.

The experiences seen in several local VWOs honoured at the Charity Governance Awards 2014 demonstrate how boards can play an active role in human capital management. For example, in Methodist Welfare Services, the human resources (HR) committee, which reports directly to the board, is consulted on all major human capital policies and procedures. For issues pertaining to staff remuneration such as performance bonuses, approvals from the finance committee and the board are sought to ensure proper governance. The board and the various centre governance committees are also involved in the recruitment of senior and critical positions.

Similarly, at the Handicaps Welfare Association, the board helps to promote employment stability by fostering strong alignment between both the NCSS salary guidelines and the Agency for Integrated Care manpower development guidelines, as well as ensuring good talent management, succession planning and career development practices for critical roles.

In RSVP Singapore, the board holds regular reviews of its growth plans and seeks to ensure staff retention by benchmarking salaries to market and using the NCSS's HR services. The board of Ren Ci Hospital too reviews the hospital's performance management system and strategic workforce planning, including salary scales at all employee levels to ensure market alignment.

The examples above give insights into how VWOs boards can be (more) involved in the talent management agenda. For a start, VWO boards can set up HR committees to look into issues such as compensation, succession planning and performance management of key management personnel. Beyond these, which are traditionally already within the scope of purview, HR committees should also monitor strategic talent management areas such as overall talent management, organisational culture, and employee engagement and development.

However, to increase the involvement and impact of the board in talent management, there must be sufficient human capital expertise among board members, and also available quality information on human capital issues within the organisation.

A BETTER UNDERSTANDING

To that end, VWO boards need to work with management and HR to gain a better understanding of ground issues and culture within the organisation, and challenge them with questions on the calibre of talent, how qualified they are for the jobs, how they should be compensated and developed, as well as who the key performers are, and the risks of losing them.

Another area that VWO boards can provide oversight and advice is in the organisational culture. Successful organisations often have, at its core, a strong set of values stemming from a clear vision and culture.

VWOs boards should view culture as a top priority and have a clear understanding of how the organisation's current culture is nurturing or hindering employee relationships and consequently organisational growth. If they accept that talent and culture are key drivers of organisational development, then elements of talent and culture must be integrated into the agenda of board meetings throughout the financial year cycle and allocated adequate time for discussion. Also, boards can consider establishing qualitative and quantitative metrics on talent management, communicate these clearly to the management, and ensure that there is accountability and commitment.

Without a doubt, VWOs are in stiff competition with the private sector for talent. Whether there is a level playing field in this war for talent remains debatable. What is certain is that active involvement at the board level will bolster the organisation's ability to attract and retain talent, and having the right talent will contribute to the attractiveness of the social service sector as a whole.