Governance is a critical issue confronting sport organisations. Its importance in the management of sport organisations has been heightened due to the transition of many sports from predominantly volunteer administered organisations anchored in an amateur ethos, to professionally managed entities catering to a more sophisticated sport marketplace. This paper identifies four elements from the sport governance literature as the key research foci to date: shared leadership, board motivation, board roles, and board structure. Four generic themes (performance, conformance, policy and operations) are also examined and expressed as governance capabilities. The strategic role and performance of the board, while central to the practice of governance, is shown to be a weakness in many sport organisations. Further, the strategic role of the board is underdeveloped in the sport management and governance research literature. Finally, it is noted that the governance literature is shaped by a normative and prescriptive approach that may not fully encompass the diversity that
Lesley Ferkins is with the School of Sport, Unitec, Private Bag 92025, Auckland New Zealand. David Shilbury is with the Sport Management program at the Bowater School of Management & Marketing, Deakin University. Gael McDonald is Vice President, International at Unitec, New Zealand. E-mail for Lesley Ferkins: [email protected].
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exists within the sport setting. The paper concludes by identifying and affirming the critical gaps in our knowledge of sport governance. Future work should seek to understand sector-specific considerations, such as non-profit and commercial differences in sport; governance designs in response to changing environmental conditions; the impact of the CEO on the board’s strategic contributions; and strategic activity by the board. More use of qualitative research methods to probe such issues is recommended.
IntroductionIn a fast moving environment, governance remains central to the effective and efficient management of sport organisations (Hoye & Auld, 2001). The responsibility for the functioning and overall direction of the organisation, encapsulated by the term “governance”, is a necessary and institutionalised component of all sporting codes from club level to national bodies, government agencies, sport services organisations and professional teams around the world (Kikulis, 2000). Derived from the Latin language meaning, “to steer”, governance, for many involved in the sport sector, has been an invisible process—something that occurs as a matter of course. It is not until an organisation encounters difficulty that the spotlight is focused on this aspect of sport management. While the status and legitimacy of the group charged with governing the organisation remains, the professionalisation of many sport organisations has signalled significant change for the work of the board in governing the organisation.
Changes in sport management (e.g., the shift from a committee or council of representatives to a modern board of directors, the introduction of paid executives, player payments, increases in income and expenditure, media scrutiny and a wider range of stakeholder interest) have presented major strategic issues to those responsible for governing sport organisations. There are also distinctions between board governance issues in the private, for-profit settings and in public and non-profit settings. A well established body of literature on the differences between public sector organisations and private sector companies as it pertains to governance, explains these distinctions (Forbes & Milliken, 1999; Gopinath, Siciliano, & Murray, 1994; Miller, 2002; Miller-Millesen, 2003; Olsen, 2000). According to Shilbury (2001), the key distinction can be found in the purpose for existence. Financial motives and the responsibility to create shareholder wealth dominate the mission of for-profit organisations. Non-profit organisations, in contrast, are motivated by a preponderance of goals. They are not solely driven by financial gain, and instead are charged to protect service-to-mission. Curiously, sport occurs in all three settings (public, private for-profit, and private non-profit), with organisations such as national bodies charged with overseeing a mix of private for-profit franchises, and non-profit associations and clubs, as well as interacting with public funding
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agencies. How responsive are boards of these national sport bodies in charting the organisation’s future course as a consequence of this multi-layered and rapidly changing environment? What, indeed, is the strategic contribution of individual board members? How pro-active are contemporary sport boards in developing the organisation strategically? What are the factors that both constrain and enable sport boards to think and act strategically? How can contemporary sport boards build their strategic capabilities?
The purpose of this paper is to investigate current knowledge about the governance of sport organisations, and to apply this knowledge to questions of board strategic capability within national sport organisations in order to identify areas for future research. Governance issues from the corporate, non-profit and sport contexts are considered in order to construct a meaningful understanding of the governance concerns impacting on national sport organisations. The role of the board in the strategic development of the organisation is accentuated in this discussion. While little is known about this aspect of board work, it is one of the pivotal aspects of the governance function in any context. This argument is developed by first considering corporate and non-profit governance research, as well as literature from organisation theory as it relates to sport. From this foundation, the environmental dynamics of governance currently facing New Zealand and Australian sport, such as high profile governance failures, demands of multiple stakeholders, the legal environment, board structuring and leadership are presented. This is followed by a discussion of sport governance themes, which are used to develop the “governance capability” and “sport board outcomes” sections. The paper concludes by identifying gaps in our knowledge of sport governance, and recommending foci for future research to best support the work of sport boards.
Corporate Governance InfluencesThe corporate governance literature is dominated by discussion of agency theory and, to a lesser extent, stewardship and managerial hegemony theory. Concerns around ownership and control of corporations, as described by these theories, are relevant for national sport organisations as they seek to clarify the relationship between the agent (paid staff) and the board. Agency theory is characterised by the situation in which an individual (the principal) engages another person (the agent) to undertake a service for them and, in doing so, delegates some of the decision-making authority to the agent (Jensen & Meckling, 1976). The theory is concerned with the risk this relationship inherently invokes. According to Sapienza, Korsgaard, Goulet, and Hoogendam (2000), the principal faces two risks: agent opportunism (acts of self-interest at the principal’s expense), and adverse selection (agent’s lack of ability to meet performance expectations). The threat of agent opportunism exists because the two parties potentially have divergent interests or goals for the firm.
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In contrast to agency theory, stewardship theory considers situations where managers, as stewards, are motivated to act, not out of self-interest, but in the best interests of their principals. Stewardship theory negates the so-called agency costs by assuming that a steward’s behaviour will not depart from the interests of the organisation. A steward’s behaviour is based on co-operation, pro-organisational and collectivistic actions. This type of behaviour is placed as a higher priority than self-serving behaviour (Davis & Schoorman, 1997).
Managerial hegemony theory asserts that, while the board has power by legal right, the real responsibility for the organisation is assumed by management (Stiles, 2001). Dallas (1996) identifies a number of reasons for this; including the considerable influence management has over the selection of board nominees, pressure for conformity, and increased opportunity for deeper knowledge of organisational issues. In his discussion of contra-hegemony theory, Dallas (1996) concludes that the theory is based on the notions that “ …management should not have substantial influence over the board” (p. 2) and that the board’s most important function is to “…ensure that management acts in the best interest of shareholders” (p. 2).
While the commercial, size and resource imperatives of sport organisations may differ, the central management tenets are universal. That is, there is concern in the literature about the latent role of the board regarding its responsibility for strategic development (Garratt, 1996; Ingley & van der Walt, 2001; Pettigrew & McNulty, 1995; Stiles, 2001; van der Walt & Ingley, 2003). Stiles (2001) concludes that boards fail to realise their potential in the strategic decision-making process.
In linking this work to sport, studies in the field of sport organisation theory, specifically professionalisation and bureaucratisation of sport organisations, strongly indicate that there are issues surrounding ownership and control within the sport context (Amis & Slack, 1996; Kikulis, Slack, & Hinings, 1992; Shilbury, 1993, 2001; Slack, 1985; Slack & Hinings, 1992). Amis and Slack (1996) found that the relationship between volunteers and professional staff, and their struggle for control, is the principal contributing factor for the lack of association between size and structure of decision-making. Shilbury (2001) considered that “…both national and state sporting organisations have been grappling with the issue of control as volunteer officials have slowly ceded control to professionally employed managers” (p. 255). Furthermore, Shilbury points out that the notional differences found within agency and stewardship theories provide a useful framework to consider the evolving roles of both boards and professional staff within sport organisations.
This section demonstrates that concerns around ownership and control of corporations, as described through agency, stewardship and managerial hegemony theories have some application in the emerging professional sport environment. In particular, the board’s role in strategic development may be impeded by tensions between, and a lack of clarity in, the relationship between the agent (paid staff)
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and the board. The next section considers literature from the non-profit setting in order to identify connections between corporate governance work, sport governance research and, in particular, the strategic role of the board.
Non-profit Governance InfluencesLiterature on non-profit governance has been dominated by a prescriptive style of authorship (e.g., Carver, 1997; Hardy, 1990; Houle, 1960, 1989). The Carver (1997) model appears to be widely adopted by advocates of contemporary governance practice in New Zealand and Australian sport (Australian Sports Commission, 1999; Kilmister, 1999). Carver advocates a distinction between board policy roles and staff management roles. He considers that boards spend too much time on operational and trivial matters and should be far less involved in the workings of the organisation. Inglis (1997a) considers that Carver (1997) provides a useful prescriptive contribution to sport governance thinking, but notes that his assumptions regarding board practices are empirically untested.
Since the 1990s, governance theory developed and tested by empirical research is beginning to emerge (Bradshaw, Murray, & Wolpin, 1992; Heimovics & Herman 1990; Herman & Heimovics, 1993, 1994; Herman & Renz, 1998, 2000; Herman, Renz, & Heimovics 1997; Inglis, 1999). Empirically derived theories relevant for sport governance fall largely within the concept of organisational effectiveness. Significant research was conducted by Herman et al. (1997) and Herman and Renz (1998, 2000) on the application of social constructionism to board and organisational effectiveness. In essence, the social constructionist perspective allows researchers to view the thorny concept of organisational effectiveness as socially created. In contrast to a “realist conception,” which holds that there is objective effectiveness, the former holds that effectiveness is as someone judges it to be. That is, effectiveness is subject to the judgement of different stakeholders of the organisation. This has proven a useful paradigm by which to view both board effectiveness and organisational effectiveness, and has led scholars who have adopted this paradigm to seek empirical backing from a range of stakeholders on those factors that define good governance, thus generating a rich data set. This theoretical framework has also been adopted by Hoye (2002) and Papadimitriou (1999) in their investigations of sport board performance, which are discussed later in the paper.
True to the paradigm of social constructionism, Herman, Renz, and Heimovics (1997) found a wide variation in the use of prescribed board practice. They also found judgements of board effectiveness to differ substantially. Significantly, they found that the chief executive officer’s judgement of board effectiveness was moderately related to the use of prescribed board practice. A year later, Herman and Renz (1998) found a correlation between organisational effectiveness and board
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effectiveness. The empirical work led these authors to advance five propositions directly applicable for the sport organisation context: (1) non-profit organisational effectiveness is multidimensional and not reducible to a single measure; (2) boards make a difference in the effectiveness of non-profit organisations, but how they do this is unclear; (3) more effective non-profit organisations are more likely to use correct management practices (including strategic planning and strategy development) than are less effective non-profit organisations; (4) non-profit organisational effectiveness is a social construction; and (5) program outcome indicators as measures of non-profit organisational effectiveness are limited and can be dangerous.
An alternative measure was used by Bradshaw et al. (1992) in their search for elements of board effectiveness. Using objective indicators of organisational performance, 400 non-profit voluntary organisations in Canada responded to a survey. The objective indicators were defined as structural policy characteristics (board size, committees, position descriptions and policy manuals) and process characteristics (nature and extent of strategic planning, meetings, decision-making and conflict). Their findings supported other non-profit research in terms of the limited role played by the board, that is, that boardmembers act “…mostly as trustees rather than entrepreneurs, and are largely risk averse” (p. 246). In addition, Bradshaw et al. identified the social constructivist perspective as an avenue that should be explored in order to determine perceived effectiveness from stakeholder viewpoints.
Indeed, research findings in the non-profit setting regarding the strategic contribution of the board are consistent with studies on corporate and sport governance in terms of the latent power of the board. Heimovics and Herman (1990), in a study involving 51 CEOs and presidents from community, human service and performing arts organisations, found that the widely held perception of the board being in control and having ultimate power is not accurate. “The results suggest both chief executives and board presidents believe in the “psychological centrality” of the chief executive in a hierarchy of responsibility for organizational outcomes” (p. 59).
In a case study on a national service-providing welfare agency in England, Harris (1989) found that boards were quite removed from influential actions and decisions. In a later study of paid executives from 53 museums’, churches’ and human service organisations’, Katsioloudes and Tymon (2003) found evidence of a lack of perceived participation by volunteers in strategic planning. Despite this evidence indicating a lack of board involvement in strategic matters, a study of the roles and responsibilities of community non-profit boards (Inglis, Alexander, & Weaver, 1999) established “…strong empirical support for the Strategic Activities…” (p. 163) conducted by board members. In this study, the authors defined “Strategic Activities” as roles relating to planning, setting the mission and vision, developing policy, evaluating the executive director, and focusing strongly on the external environment. The study confirms the importance of a strategic orientation for non-profit boards.
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Work in the non-profit arena has advanced support for the widely held assumption that a focus on strategic organisational development will enhance organisational effectiveness (Brown & Iverson, 2004). Indeed the Carver model, although criticised for its distinctions between the role of paid staff and board members, strongly advocates for board members to focus their energies on strategic activities such as policy development. Work by Inglis and Weaver (2000) on prioritising strategic activities on the board agenda provides an insight into how particular actions can influence the level of strategic contribution by the board. Hoye and Inglis (2004) presented an overview of non-profit governance models, and considered ways in which these models could be adapted to the context of leisure organisations. In doing so, they noted the association between governance models, organisational effectiveness and strategic expectations. More studies of this kind are needed to increase the empirical knowledge-base around how to build strategic capability. What then do we know about the strategic function of the board in sport organisations, and how are sport organisations different from other organisations to the extent that they warrant separate investigation on this topic? The following section explores the sport management literature in organisation theory in order to seek answers to such questions.
Sport Organisation Theory InfluencesFor the purposes of this review, selected elements of organisation theory as they relate to sport governance have been included. The intent of this is to link knowledge of sport organisations to sport governance, and to then propose aspects of sport governance research that can significantly enhance our knowledge base. Some of the more prevalent research linking sport organisation theory to the strategic role of the board includes examination of the bureaucratisation and professionalisation of sport organisations (Enjolras, 2002; Skinner, Stewart, & Edwards, 1999; Slack, 1985), organisation and industry structure (Amis & Slack, 1996; Chelladurai, 1987; Kikulis, Slack, & Hinings, 1992; Shilbury, 2000), culture (Doherty & Chelladurai, 1999), effectiveness (Papadimitriou & Taylor, 2000), change and stakeholder influence (Inglis, 1991; Kikulis, 2000; Slack & Hinings, 1992), strategic decision-making (Kikulis, Slack, & Hinings, 1995a, 1995b; Sack & Nadim, 2002) and leadership (Chelladurai, & Saleh, 1980; Weese, 1995).
These studies represent substantial theoretical and/or empirical work in this area. Many examine the changing nature of sport and the ways that sport has responded to environmental influences, and provide an important foundation for understanding sport governance issues. In particular, this work demonstrates that sport scholars are working within a systems perspective with high regard for the environment (Armstrong-Doherty, 1995; Chelladurai, 2001). A synthesis of this
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work identifies the impact of paid staff on voluntary sport organisations as a common influential element. Shilbury (2001) for example, concluded, “Tensions evident in the transition from amateur to professional governance have contributed to the need to examine the role of the board of directors in sporting organisations” (p. 253).
With regard to the bureaucratisation and professionalisation of sport, Slack (1985) found that while bureaucratic characteristics existed within sport organisations, “…these did not all emerge at or around the same time” (p. 163). His study of the Canadian Amateur Swimming Association showed that “…in the initial stages of development the only bureaucratic manifestations exhibited by voluntary sport organizations were a functional division of labour and a control system which took the form of a set of rules and regulations … As the organization grew, so did the complexity of these manifestations” (p. 163–164). These findings provide evidence of both the changing nature of sport organisations as they exhibit aspects of a bureaucracy and the nature of change that is a piece-meal approach according to internal and external influence.
Subsequent studies have focused on the professionalisation of sport organisations that have moved from entities administered by volunteers to those managed predominantly by paid staff. “Embedded in this process of professionalisation is the issue of control” (Shilbury, 2001, p. 253). Evidence for this assertion comes from Slack and Hinings (1992) in a study examining change in Canadian national sport organisations. They noted a trend toward a more professional and bureaucratically structured organisational design, but reluctance on behalf of the volunteers to cede decision-making control to paid staff. The authors determined that such a change appeared to challenge the traditional volunteer-based culture of these organisations.
Building on this work, Amis and Slack (1996) cited similar findings in their investigation of the size-structure relationship in voluntary sport organisations. They found that the most significant unique characteristic for voluntary sport organisations was the relationship between volunteers and paid staff, the increasing number of professionals, and the accompanying issue of control that this aspect of professionalisation has highlighted. Moreover, a lack of association between size and decision-making in the organisations they studied led them to conclude that the “…central role of decision-making as a means of control and the desire of volunteers to retain this control…” (p. 84) was used to explain, in part, why decision-making processes had not changed significantly as the organisation grew.
Shilbury (2001) concluded that reluctance on behalf of volunteers to cede decision-making control highlights an impediment to the professionalisation process. He points out the need to study the roles and functions of boards of directors in sport organisations to better understand the dynamics of this change process. Indeed, these findings raise the question as to whether paid staff should be assuming decision-making authority and control of the organisation, or whether
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a new breed of “professional” volunteers (i.e., the board of directors) comprised of professionally-skilled strategic thinkers is needed. Theories such as agency theory and managerial hegemony theory strongly advocate for an active decision-making authority to guard against the self interests of paid staff and to represent stakeholder interests (Sapienza, Korsgaard, Goulet, & Hoogendam, 2000; Stiles, 2001). Has this happened in sport organisations or has the volunteer committee, traditionally responsible for the day-to-day operations of the organisation been forced to withdraw without being replaced by strategic thinkers skilled in charting the organisation’s future course? The question still remains: What is the nature of strategy development at board level in sport organisations?
Strategy is a well developed concept in the broader field of management and organisation theory, with many divergent schools of thought (Chandler, 1962; Drucker, 1990; Kotler, 1988; Mintzberg & Waters 1985; Porter, 1985). It has not been, until the early 1990s, however, that researchers have considered strategy in the context of sport organisations. Thibault, Slack, and Hinings (1993) are forthright in their observation of this: “Despite the pervasiveness of work on strategy in … management there has been virtually no attempt to examine this aspect of the operation of sport organizations…” (p. 39). Slack (1996) is equally forthright in his criticism of the lack of studies on the formulation and implementation of organisational strategy in sport. He argues that:
In addition, strategy has also been shown to be tied to organizational structure and design (Chandler, 1962; Miles & Snow, 1978); it influences and is influenced by organizational culture (Schein, 1983), is mediated by technology (Scarborough & Corbett, 1992), and has been shown to have strong links to leadership (Leavy & Wilson, 1994). Yet, despite the centrality of strategy to the operations of all organizations within the sport industry and the links strategy has to other organizational phenomena, there have been very few studies of this topic in our field. (p. 101)
Of the few studies that have been undertaken, researchers have concentrated on investigating strategy and policy development in sport organisations in terms of identifying the situational features of the sport environment (Amis, Slack & Hinings, 2004; Caza, 2000; Girginov, 2001; Inglis and Graff, 1997; Legg, 2003; Sack & Nadim, 2002; Shilbury, 2000; Thibault, Slack, & Hinings, 1993, 1994). In a conceptual contribution that was later empirically verified, Thibault, Slack, and Hinings (1993), concluded that “…there is no one best way to strategize in sport organizations; the strategy developed should reflect the organizational situation” (p. 41). More significantly, Thibault et al. established a framework to identify four types of strategy that could be developed by sport organisations. Drawing on work in the non-profit sector by MacMillan (1983) and organisational typologies developed by Miles and Snow (1978) and Porter (1985), Thibault et al. identified two groupings of strategic imperatives that need to be considered when developing
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strategies: program attractiveness (e.g., fundability, membership numbers, volunteer appeal and public profile) and competitive position (e.g., cost of membership and equipment for participants). They juxtaposed these two dimensions, which represent the context in which national sport organisations operate, with the four types of strategies, to develop a 2 × 2 matrix of strategic types. The four quadrants of the matrix represent strategy options most appropriate for national sport organisations. The options are: refiner (i.e., fine tuning existing programs), enhancer (i.e., enhancing already strong programs), explorer (i.e., exploring alternative strategic options), or innovator (i.e., developing new programs).
The framework assists managers in identifying their organisation’s competitive position and the attractiveness of their programs, and in matching this information with the strategy option that best fits the sport organisation’s specific context. The authors argue that by assisting managers to identify the strategic imperatives that best fit their organisation’s situation, they will be in a much stronger position to develop effective strategies. An understanding of the board’s involvement with such strategy formulation processes, both in terms of current contribution and future potential, would provide a useful complement to this framework.
In summary, organisation theory applied to sport has indicated that the processes of bureaucratisation and professionalisation of sport organisations have created a changing role for those in governing positions. These changes include a rapidly changing external environment and changing internal dynamics, such as the introduction of paid staff (Thibault, Slack & Hinings, 1991). The few studies on the nature of strategy formulation and implementation have shown that this work has been, to a large extent, driven by paid staff and funding agencies, rather than by the board (Thibault, Slack & Hinings, 1993, 1994). Questions such as how involved are sport boards in strategy and strategic development? What are the impediments to strategic capability? And, what factors facilitate the development of strategic capability in sport boards have not, as yet, been considered by sport organisation theorists. However, there is much evidence to suggest that the answers to these questions could be central to more effective functioning of sport organisations (Shilbury, 2001). The next section proposes an integrated model of sport governance research. It indicates the ways in which the theoretical influences just presented may combine with environmental factors specific to sport and the growing body of literature on sport governance.
Schema of Sport GovernanceFigure 1 presents three components of sport governance: environmental dynamics, sport governance factors and ultimate governance capabilities. It is appropriate that sport governance be placed in the context of environmental factors (environmental dynamics) including the macro influences external to the organisation and the micro
influences internally related and specific to sport (i.e., volunteer appeal, membership numbers and funding sources). In signifying their importance, professionalisation and bureaucratisation appear as the connecting influences across macro and micro factors. The second tier of the schema presents the sport governance factors that act as antecedents in building capability, and centre largely on shared leadership, board motivation, board roles and board structure. The interaction of environmental circumstances and sport governance factors lead to potentially effective governance outcomes. While it would be tempting to label these purely performance outcomes, a broader perspective views this tier as governance capabilities. Governance capabilities have been identified as performance, conformance, policy and operations; and are connected by the umbrella notion of strategic development.
The schema draws together the current literature to provide a meaningful structure to our understanding of the interactions surrounding sport governance, and the mechanisms by which sport governance might be improved. The next section considers the studies specific to sport governance and examines the strategic role of boards.
Environmental DynamicsThere are a number of environmental factors that have led to a sharper focus on the work of the board in sport organisations. These factors include increasing media and public scrutiny, a greater range of stakeholders to serve, a tightening of the legal requirements and an increasingly professionalised playing and business environment. The media publicity that illuminated a failure of governance processes relating to the 2003 Rugby World Cup is an example of how governance concerns can become open to public examination. In this instance, New Zealand’s leading national sport organisation, the New Zealand Rugby Union (NZRU), lost the rights to co-host the 2003 Rugby World Cup because it was unable to guarantee “clean” stadia. Following an independent inquiry, the chief executive and most of the board resigned. At issue was board monitoring and decision-making processes, and an inability to balance the demands of multiple stakeholders such as the International Rugby Board, NZRU sponsors, media and the public (Eichelbaum Report, 2002). A concern for many sporting codes, the members of sport organisation are no longer the only group with a “stake” in the success of the organisation and its teams, athletes and events. As identified by government reports in both New Zealand and Australia (Ministerial Taskforce, 2001; Standing Committee on Recreation & Sport, 1997), sport organisations and their decision-making representatives must strive harder to understand the needs of an increasing range of constituents such as commercial sponsors, media, public sector funding agencies and sport service agencies, clubs,
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associations, individual members, and in some instances, the public at large. The board’s ability to strategically lead the organisation is central to its capacity to avert major crises and respond to stakeholder concerns.
A more demanding legal environment has also been cited by government reports as a practical issue challenging the role and responsibility of sport boards. In New Zealand for instance, there are approximately eighteen separate pieces of legislation, ranging from the Commerce Act 1986 to the Health and Safety in Employment Amendment Act 2002, impacting on the management of sport organisations (Hillary Commission for Sport, Fitness and Leisure, 2001). A recent case in New Zealand, for example, found a sport event organiser guilty of criminal nuisance after it was determined that her race briefing and instructions regarding road closures were unclear. Although the ruling has subsequently been overturned, this was the first reported conviction for a race organiser, and the government agency for sport in New Zealand (now called Sport and Recreation New Zealand) has responded with a challenge to boards of national sport organisations to review their risk management strategies regarding event organisation. The strategic contribution of the board and its ability to think ahead to ensure a secure future for the organisation in light of legislative “tightening” is paramount.
There is a cross-section of sports in New Zealand and Australia facing questions about the structure and membership of their boards. Two major sports in New Zealand have undergone independent reviews in recent years. The Boston Report (Boston Consulting Group, 2000) recommended a re-designed composition of the New Zealand Rugby Football Union board, as the Hood Report (New Zealand Cricket Review Committee, 1995) did for New Zealand Cricket and its member associations. In Australia, Crawford (1993) and the Australian Sports Commission, (2003) investigated the governance of the Australian Football League and Australian Soccer, respectively. In examining the affairs of Australian Soccer, the Crawford Report (Australian Sports Commission, 2003) highlighted three major challenges confronting the organisation: (1) ensuring the representation of stakeholder concerns through appropriate membership and voting structures, (2) sharing the board responsibility for the development of amateur “participation” opportunities between the national association and its state affiliates; and (3) examining issues of governance for the professional aspects of the sport. These issues are representative of the challenges that confront the majority of sport organisations in Australia and New Zealand.
Finally, in terms of providing an overview of sport in New Zealand and Australia, the major findings of the Standing Committee on Recreation and Sport (SCORS, 1997) and the Ministerial Enquiry in Sport, Fitness and Leisure (Ministerial Taskforce, 2001) captured some critical governance issues. They pinpointed disunity within sports, ineffective governance, lack of shared national leadership, and a lack of constituent confidence in national and regional structures.
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In considering these findings, Shilbury (2001) stated: “In other words, governance and structure are impeding the progress national sporting organisations are able to make in completing the professionalisation of their industry and the implementation of management practice” (p. 259).
In summary, practical governance concerns include high profile governance failures in decision-making and board monitoring, demands of multiple stakeholders, the changing legal environment, and the structure, leadership and composition of boards in an increasingly professional environment. The strategic activity of the board both in terms of strategy development and strategic thinking has an important bearing on the way these issues are handled. How then, has the development of governance research and theory contributed to our understanding of the practice of sport governance? More specifically, what does the research tell us about the strategic function of the board?
Sport Governance ThemesThe significance of sport governance for the management of sport organisations has not yet been fully investigated by sport management scholars. It has not been until recent times that researchers have turned their attention to this topic (Auld & Godbey, 1998; Hoye & Auld, 2001; Hoye & Cuskelly, 2003a; Hoye & Cuskelly, 2003b; Inglis, 1997b; Kikulis, 2000; Papadimitriou, 1999; Shilbury, 2001). As a result, there is a small but growing number of empirical studies that seek to address the practical concerns of sport governance dynamics. This section analyses the major theories and concepts that have been developed by researchers investigating sport governance, and the impact of this work on questions of board strategic involvement. These major themes appear to have a sense of chronological development, demonstrating a considered approach by researchers to build on previous literature. The themes have been organised into four categories: shared leadership, board motivation, board roles, and board structure. Some address contemporary issues of practice and some signal issues of future concern. None specifically address the strategic role of the board, but many of the findings have important implications for future investigation of strategic development of boards in sport.
Shared LeadershipAn interest in the interaction between paid management (referred to as the executive director) and the voluntary board has been the dominating topic for researchers in sport governance (Auld, 1997; Auld & Godbey, 1998; Hoye & Cuskelly, 2003a, 2003b; Inglis, 1994, 1997b; Inglis & Graff, 1997; Kikulis, 2000; Searle, 1989b; Shilbury, 2001). These studies seek to address the balance of influence and power between the executive director and voluntary board, referred to as “shared leadership.”
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Early foundational research by Searle (1989b) investigated the extent to which municipal recreation directors and recreation advisory board members perceived their relationship to be one characterised by fair exchange. Using data collected via mail questionnaire from 103 recreation directors and 947 recreation advisory board members across three provinces in Canada, Searle found that the perceptions of influence between the two parties differed. More specifically, he found that although both parties believed they should have more influence, the majority of influence was held by the recreation director. Using social exchange theory, Searle concluded that this imbalance in influence was impacting on the relationship between director and board and this disparity would need to be addressed in order to enhance commitment and sense of responsibility on behalf of the board.
Social exchange theory was also used by subsequent authors (Auld & Godbey, 1998; Inglis, 1994, 1997b) to consider the relationships between board members and staff in non-profit organisations. According to Blau (1974), the theory explains the motivation behind why people enter into social relations. Inglis (1997b) investigated selected dimensions associated with the leadership shared between volunteer board members and staff in Canadian provincial sport organisations using social exchange theory to help explain the interaction. She also drew on studies about the nature of change and decision-making in national sport organisations (Hinings & Slack, 1987; Kikulis, Slack & Hinings, 1995a, 1995b; Macintosh & Whitson, 1990; Slack & Hinings, 1992) to help explain shifts in volunteer control and the leadership dynamics of boards. Inglis reported on data gathered as part of a larger study (Inglis, 1994) which utilised a questionnaire sent to executive directors, presidents and board members, to gather perceptual data on a number of leadership-related indicators. Two key findings emerged from the study.
The first concerned expertise required of the president and board, as perceived by the executive directors. The top two criteria were an interest in the work of the organisation, and a proven track record in the ability to contribute time. Inglis (1997b) notes that this finding is consistent with the notion of a less specialised focus for volunteers. The second finding establishes significant differences between actual and preferred levels of influence between paid staff and volunteer board members. Importantly, a general trend for developing and assessing long range plans and strategy for the organisation showed that both paid and volunteer personnel thought that the presidents and board members should have more influence in this area.
Overall, Inglis’ (1994) findings underscored “…the reality that different positions bring different perceptions to the board table” (p. 29) and the necessity to understand how the notion of shared leadership operates when developing the strategic role of the board. In addition, this foundational work highlights developing issues between volunteer board members and paid staff, signalling potential role ambiguity in responsibility for strategic development.
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Shilbury’s (2001) research highlighted the significance of the professionalisation of sport in the shared leadership dynamic between executive director and board members in Australian state sport organisations. Shilbury used a modified version of the instrument employed by Inglis (1997b) to survey executive directors and volunteer board members. Consistent with the Inglis study, Shilbury found that the influence of paid-staff in decision-making was increasing. Interestingly, board members largely saw this as necessary, and desired less influence in some areas. Also consistent with Inglis’ results, Shilbury found that executive directors preferred board members to have more influence on strategy and long-range planning. He concluded that this apparent paradox might be an indication of “genuine cooperative power between boards and executive directors” (p. 276).
Auld and Godbey (1998) also found variance in the levels of influence in decision-making, favouring increasing influence by the executive director. Using social exchange theory, they found that decision-making between paid staff and the board was perceived as not reciprocal. Unlike Shilbury’s (2001) conclusions, however, Auld and Godbey (1998) expressed concern at the impact of professionalisation. They consider it critical that volunteers are not marginalised from the decision-making aspects of their role as this can create apathy toward their work.
These studies on shared leadership provide insight into the impact of paid staff on the strategic role assumed by the board. Almost all the findings indicate the potential for diminishing responsibility of the board in strategic development. Greater understanding of the notion of shared leadership and evolving levels of influence between paid staff and volunteer board members, as perceived not only by the actors themselves but other stakeholders, could significantly impact the ability of a board to build its strategic capability. Such future studies may be best served by engaging qualitative methods to gain a more in-depth understanding from multiple sources.
Board MotivationClosely linked to the notion of shared leadership are the constructs of board cohesion, motivation to serve and board needs. Searle (1989a, 1989b) and Inglis (1994) have investigated board member motivation to serve as well as board needs; while Doherty and Carron (2003) have considered board cohesion. In his study, Searle (1989b) asked some critical questions about local government recreation advisory boards that are also issues for today’s sport boards. That is, do board members understand their role and relationships? Do they understand what is expected of them? Are they asked what they are expecting from the relationship? Using social exchange theory, Searle (1989b) asserted that “…people will maintain their involvement so long as they see their needs being met and the costs of involvement (e.g., time, money, effort), is not in excess of the benefits” (p. 21). Searle (1989b) concluded that important needs on
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behalf of the paid recreation directors and the board members were not being met. In both studies, Searle asserts that by understanding the respective needs of paid recreation directors and board members, the relationship will be enhanced. As a consequence, the “…future of recreation development … hinges on the relationship between the (paid) recreation directors and the recreation board” (1989b, p. 19).
Inglis (1994) built on the work of Searle (1989a) to investigate Canadian provincial sport boards. She used Searle’s four needs constructs which assessed growth, responsibility, contribution and recognition. An important outcome for Inglis (1994) was the addition of a fifth “relations” construct which supported the socio-relational dimensions from previous needs theories (Knoke & Wright-Isak, 1982). The results of her study affirm that individual needs of board members are “…considered important and vary between men and women and positions held in the organisation” (p. 186).
A later study by Doherty and Carron (2003) explored board cohesion in Canadian amateur sport organisations. They found that it is the task aspects, as distinct from social aspects, that keep the group together. Using the Group Environment Questionnaire, they surveyed twelve non-profit amateur sport organisations in Canada, which generated data from 117 volunteers holding positions on executive committees. A key finding of this work established that group integration around the task was a consistently important aspect of board cohesion, and that cohesion impacted on board member satisfaction and perception of board effectiveness.
These studies highlight the importance of considering the motivation of individual board members to join boards, what keeps them happy and together and the differing set of needs which exist between paid executives and voluntary board members. A board may not contribute at a strategic level if individual needs, such as a sense of group cohesion and clear expectations of board roles, are not being met.
Board RolesImplicit in the practical issues facing the governance of sport organisations is the consistent need to define the role of the board, especially in light of a changing environment. Focusing on Canadian provincial sport, Inglis (1997a) investigated roles of the board in amateur sport organisations. She asked whether the normative management literature describing roles of the board was relevant for sport organisations in Canada. Four board roles were found to be relevant involving mission, planning, executive director and community relations. In a study of state sporting organisations in Australia, Shilbury (2001) was specifically concerned with the transition from a voluntary based administration to a professionalised sector, and the impact of this transition on the role of the board of directors. Shilbury used nine roles of the board based on the non-profit literature: raising funds, setting financial policy, advocacy and community relations, hiring decisions of senior staff,
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long-range planning, program development and delivery, representing constituents, setting policy, and budget allocation. Using agency theory, Shilbury determined that an increase in influence of the role of the executive director is being conceded by board members in most of the nine areas.
These studies confirm that board members, including the chief executive, perceive their contribution to the strategic development of the organisation as central to their role. While the findings by Shilbury indicate that paid staff are increasingly assuming the responsibility for establishing strategic direction, further investigation into the ongoing contribution by board members to strategy development may be critical to our understanding of sport governance.
Board StructureThe structure and composition of sport boards has not been specifically addressed by sport researchers. However, it has appeared as a variable in several studies. Hoye (2002) considered the structural elements of complexity, formalisation, and centralisation of the board in relation to board performance. He found that “…effective boards were less complex than ineffective boards … (and) a higher level of horizontal differentiation of boards, specifically the allocation of portfolios of responsibility to individual board members, was also related to more effective board performance…” (p. 161). He also determined that smaller boards, “…with an optimal size of seven…” (p. 161), were perceived to be more effective. In contrast to this, Doherty and Carron (2003) indicated that groups comprising 13 members or more perceived greater social cohesion and thus were potentially more effective. The size effect, which was found to be directly related to social cohesion, as distinct from task cohesion, “…can engender greater member satisfaction and perceived committee effectiveness” (p. 136).
In terms of board structure and the issue of a rapidly changing environment, Kikulis (2000) considered that “…the volunteer board is a deep structure and core practice that demonstrates traditionality” (p. 308). In a conceptual contribution she argued for the use of institutional theory to provide a strong foundation for advancing our understanding of this area. She concluded that “…there is variation in the extent to which different aspects of governance and decision making in NSOs are taken for granted, institutionalized, and thus resistant to change” (p. 317). Kikulis was able to link her theoretical argument to issues of practice by asserting that the “…implication for managers is that they have a choice in enabling or constraining what is institutionalized” (p. 317). Her conclusions state that this choice is made easier when structures and practices have lower levels of institutionalisation, and that this process can be influenced by an understanding of the process of institutionalisation and the manner in which governance and decision-making has evolved. This argument provides a useful backdrop for considering factors, such as structure, that both constrain and enable a board’s strategic contribution.
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On the matter of structure, Shilbury (2001) asserted that in light of the changing professional environment, the composition and structure of boards, also needs to change. He believes that sport organisations will need to clearly define the changing role and type of person they can attract as a board director. “How such people are elected or identified will also be an issue for the future” (p. 277). How boards are comprised and organised significantly impacts on their ability to provide strategic direction. These assertions about structure provide insights into some of the enabling factors, as well as the impediments, to strategic contribution.
Summary of Sport Governance ThemesThe sport governance literature, especially in the last few years, addresses issues of practice. In particular, it provides a deeper understanding of the relationship between volunteer board members and the paid executive in terms of shared leadership and perceived influence. There is consensus in the literature about the increasing centrality of the paid executive in governance decision-making, but some argument as to whether this is a positive or negative influence on organisational effectiveness. The motivation to serve on a board and the needs of board members sheds some light on the characteristics of people involved in such critical roles, as do questions of board structure and roles.
There are also connections that can be made between findings from the sport governance literature and the question of board strategic capability. The research on shared leadership indicates diminishing responsibility for strategic development by the board. The research on board motivation suggests that in order for board members to be active strategically, their needs must be met in some way. From the work on role definition, there is evidence to suggest that the strategic role of the board is blurred between the board and the chief executive. While sport governance research has not directly considered the structure variable, other research on board structure confirms the importance of the partnership between structure and strategy (Pettigrew & McNulty, 1995). It may be that an investigation into board strategic function will also need to address how boards might need to be structured to best facilitate this process. The next section summarises the key elements from the literature that help enhance governance capability or good governance performance.
Governance CapabilityA major contribution to the theoretical foundations of governance capability has been the development of four key themes identifying capabilities in performance, conformance, policy and operations. These themes run through much of the governance literature, irrespective of the context (Carver, 1997; Davis & Schoorman, 1997; Francis, 1997; Shilbury, 2001). Performance is understood to be the forward-looking, strategic role of the board. It is the responsibility of those governing the
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organisation to ensure a viable future, to strategically plan and to consider the external environmental impact on the organisation (Francis, 1997; Garratt, 1996; Stiles, 2001). In the corporate context, Francis (1997) considers that the “…constructive roles directors can play in adding value to their companies…” (p. xxi) (e.g., the performance roles), are “…quite different from those required for a traditional conformance-orientated board” (p. xxi).
Conformance then, is about the monitoring role of the board. It centres on accountability, compliance, performance management of the chief executive, and policy implementation (Bosch, 1995; Garratt, 1996; Shilbury 2001). Garratt (1996) encapsulates board conformance as “…the internal focus of the board on its performance to pre-set goals of accountability to its stakeholders…” (p 10). The need to achieve a balance between the elements of conformance and performance has been a re-occurring theme in the literature (particularly in the corporate setting) over the past ten years (Bosch, 1995; Francis, 1997; Garratt, 1996; Shilbury 2001; Stiles, 2001; van der Walt & Ingley, 2001, 2003; Ward, 1997). Bosch, for example, cites public outrage in Australia at the excesses during the economic boom period of the 1980s and subsequent share market collapse in 1987, which led to a heightened emphasis on conformance. This included calls for increased legislation, tighter regulation and board accountability. An interest in improving company performance by strengthening the board’s strategic initiative developed somewhat later (Bosch, 1995). Francis (1997) is critical of what he considers the over-emphasis on conformance. “Most books, conferences, or pronouncements on corporate governance have focused exclusively on conformance issues, on the structure and membership of boards…” (1997, p. xxi). This, Francis argues, has been at the expense of the performance role of the board and a consideration of how boards can develop the organisation in the medium and long-term future. Ward (1997) observed that while the responsibility of the company lies with the board, it is most concerned with conformance aspects of its role.
Carver (1997) is perhaps the most noted author on the governance themes of “policy” and “operations”. An early author of non-profit governance, Carver (1997) established a clear distinction between what he termed “policy”, the primary role of the board, and “operations”, the primary role of paid management. In an explicitly normative approach, Carver (1997) asserts that the board should be responsible for setting policies in four distinct areas: organisational outcomes, methods to achieve these outcomes, performance management of the chief executive, and the operations of the board itself. He argues that it is the role of management, led by the chief executive, to implement policy, and that neither should be involved in the other’s role. This prescriptive-based distinction between the roles of the board and the chief executive provides a useful point of comparison for empirical work undertaken subsequent to the development of Carver’s model. In particular, Hoye (2002), in responding to the Carver model, found that the roles of the board and paid executive are inter-related and subject to ongoing role design.
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At first analysis, the strategic function of the board falls most logically into the performance and policy themes. However, the interpretation of what is meant by “strategic contribution” has some bearing on the positioning of the concept. There is considerable consensus in the literature regarding an understanding of what is meant by “strategic.” There is less agreement as to where the strategic role of the board stops and the strategic role of management begins. Gopinath, Siciliano, and Murray (1994) consider that when “…boards adopt a strategic role, the directors guide the definition of the corporate mission and are called upon to assist in the development, implementation and monitoring of the firm’s strategies” (p. 176).
Along similar lines, van der Walt and Ingley (2003) consider that the “…strategic function of the board involves making critical decisions, particularly in relation to strategic changes, so the organisation can adapt to environmental changes” (p. 17). Stiles (2001) noted that the “…concept of involvement in strategy has proved difficult to define” (p. 629). In agreement with Judge and Zeithaml (1992), Stiles argues that a common view is based on the distinction between formulation and evaluation and that the board’s involvement in formulation ranges from “…working with management to develop strategic direction to merely ratifying management’s proposals” (2001, p. 269). With regards to evaluation, the work of the board ranges from probing management’s evaluations of resource allocations to simply accepting the evaluation that top management provides (Judge & Zeithaml, 1992; Stiles, 2001). This view provides evidence that the strategic contribution of the board may well traverse multiple aspects of the generic governance themes, especially performance, conformance and policy. In their recent work in this area, van der Walt and Ingley (2003) found that “…little empirical or theoretical research has been conducted on the board’s role in strategic decisions and strategic outcomes” (p. 17). Stiles (2001) agrees, stating that “Unpacking this concept [of involvement in strategy] is, however, rare in the empirical literature” (p. 629).
While there is a substantial body of knowledge about the strategies and strategic management of organisations (Chandler, 1962; Kolter, 1988; Mintzberg, 1987; Mintzberg, Ahlstrand & Lampel, 1998; Porter, 1985; Sack & Nadim, 2002), there are gaps in our understanding of board involvement in strategy (Johnson, Daily, & Ellstrand, 1996; Stiles, 2001; van der Walt & Ingley, 2003). Furthermore, there is little research that considers the emergent nature of strategy, as per Mintzberg’s series of studies (Mintzberg, 1973, 1978; Mintzberg & Waters, 1985) as compared to strategy as the result of formal planning, the style asserted by Chandler (1962). In his study on the impact of the board on strategy, Stiles (2001) notes that, “In research on boards of directors, discussions of the strategic role of the board have largely ignored the emergent nature of strategy and its implications for board involvement” (p. 2). Despite these gaps in knowledge around the role and nature of the board involvement in strategy and strategic development, there is much support for the notion that the strategic role of the board is a vital function and one often under-represented both in
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the practice of governance and in research on governance (Carpenter & Westphal, 2001; Garratt, 1996; Ingley & van der Walt, 2001; Pettigrew & McNulty, 1995; van der Walt & Ingley, 2003).
Sport Board Outcomes A small number of studies have been undertaken in the sport setting on governance outcomes. Inglis (1997a) included a measure of satisfaction with board performance in her study of the roles of the board in amateur sport organisations. She found that, “By position, the volunteer board members rated their performance on Community Relations and Planning factors significantly higher than did the executive directors” (p. 169). The implications of this finding have not yet been fully investigated. Although subsequent studies have addressed board performance, these have not necessarily compared CEO satisfaction with board satisfaction.
Also using the term “performance” to discuss board effectiveness and outcomes, Hoye and Auld (2001) sought to determine elements of effective board performance in a study of state sport organisations in Australia. The study examined the relationship between board performance and selected elements of board structure, board processes and board executive relations. Unlike a study by Papadimitriou (1999) who considered board performance by surveying a range of external constituent groups, Hoye and Auld (2001) were concerned only with determining performance from an internal perspective. They considered that “…board members and executives interact primarily through board processes and within a formal board structure. As such, they are in the best position to make assessments of the performance of the board” (p. 110).
In reviewing the literature on organisational effectiveness, Papadimitriou (1999) considers the lack of agreement about what constitutes effective performance as evidence to view this question from a multiple (and external) constituency perspective. As a result of the more targeted approach by Hoye and Auld (2001), their findings were more specific than Papadimitriou’s (1999). In comparing effective and ineffective boards, the former found that effective boards were better at elements such as executive-board relationships, financial management, conducting meetings, strategic planning, monitoring and risk management, selecting board members and public relations activities.
Papadimitriou (1999) found the five constituent groups involved in the study (i.e., board members, paid staff, technical staff, state and national athletes) tended to agree on the need for “…motivated, competent and influential individuals on boards as contributing particularly to the effective operation of the organisation” (p. 98). She found, however, that the constituent groups differed in their consideration of specific attributes associated with the effectiveness of voluntary sport boards. That is, the vested interests of each group placed greater or lesser emphasis on areas such as technical expertise of the sport, professional skills and elite concerns. The
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two studies highlight the importance of considering board performance and provide contrasting methods of achieving useful results. The strength of the Hoye and Auld (2001) study is its specific, consistent findings, while the Papadimitriou (1999) study challenges the internal view of performance by addressing board effectiveness from a multiple constituency perspective.
In a later set of studies, Hoye and Cuskelly (2003a, 2003b) considered board performance in conjunction with board-executive relationships. Adopting a social constructionist perspective, they found that four elements of the board-executive relationship were perceived to be associated with effective board performance: board leadership, trust, control of information and responsibility for board performance. As per previous studies (Auld & Godbey, 1998; Inglis, 1997b; Shilbury, 2001), the paid executive appears to hold a central position in decision-making. However, Hoye and Cuskelly (2003a) were able to link this centrality to effective board performance. Interestingly, overall board performance was perceived as being the responsibility of the chairperson. This finding and the findings of their 2003b study, encourages scholars to consider the board-executive relationship and its impact on performance, as more than a simple dichotomy of volunteer or executive led. Instead, perhaps, there are levels of responsibility variously assumed by board members and the executive. What, specifically, these levels might be, and to what extent responsibility for strategic development should be or is accepted by the board, have not yet been investigated. To do so would strengthen our knowledge of an important element of governance capability.
Conclusions for Sport Governance Research and PracticeThis paper has demonstrated that sport governance research has begun to address critical environmental issues such as challenges to decision-making, the demands of multiple-stakeholders, the changing environment and board leadership. A consideration of the more mature bodies of knowledge in the corporate and non-profit governance literature, as well as selected aspects of organisation theory, highlights relevant theoretical influences for sport contexts.
From the corporate governance literature, these influences focus on concerns around ownership and control of corporations, as explained by agency and managerial hegemony theory, and probe issues of manager dominance and control at the expense of shareholder interests. National sport organisations too are grappling with the growing dominance of management involvement in governance, signalling a potential retreat by volunteer board members who have traditionally been elected to protect the interests of the membership. Naturally, an incoming CEO of a national governing body will be interested in the commercial basis of the sport, and will look to opportunities to generate revenue to sustain and develop existing and new programs. The CEO inexperienced with the sport environment might not be able to
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balance commercial interests against the interests of the membership at large, which includes the way in which strategic decisions are made. If, as the literature suggests, volunteer board members are ceding control to paid professionals, this potentially leaves the interests of the membership-at-large, unattended. Further investigation into the impact of increasing CEO influence on the organisation’s strategic direction is warranted.
In the non-profit setting, theoretical influences from the literature offer direction for sport governance researchers to consider board outcomes and organisational effectiveness. In particular, Hoye and Auld (2001) and Papadimitriou (1999) have used the social constructionist perspective to develop means to identify elements of governance capability and effectiveness in sport organisations. The non-profit literature has also helped identify the additional complexity faced by non-profit boards in achieving organisational outcomes. This literature has also emphasised the importance of context specific considerations to cater for the range of non-profit entities.
The governance literature, however, is still largely shaped by a normative and prescriptive approach that may not fully explain the diversity that exists in sport. Such diversity is especially evident in the multi-dimensional nature of organisational purpose (public, private, for-profit, non-profit) and the often competing demands of stakeholder perspectives. In response to this diversity there is evidence to suggest that sport organisations have not adequately adjusted their governance structures and processes (Kikulis, 2000; Shilbury, 2001).
Indeed, sectoral differences, while significant, have not been the focus of much research in sport per se. Further investigation of the distinctions between sport organisations that are commercial and those that are non-profit is needed. Whether in sport marketing or sport management, this would be an important contribution to our understanding of the contemporary sport setting. In particular, a cross-sector study that further develops and differentiates the thematic schema of sport governance, presented in Figure 1, would address this gap in the sport governance research.
Unlike their corporate counterparts, sport organisations often do not have significant management resources at their disposal to perform the vital strategic functions that corporate CEOs undertake. However, increasing public scrutiny, and the prevalence of corporate sponsorship demand increasing levels of professionalism from many of these entities that were once predominantly managed by volunteers. Sport is in a unique position to develop governance structures and processes that allow for a context-specific understanding of shared leadership between paid and volunteer executives. This would be represented by a CEO focused on maximising the commercial opportunities that exist, and a board which understands the gains to be made from these commercial opportunities. At the same time, the board needs to remain grounded in the notion of non-profit community sensibilities that tend to more appropriately reflect the interests of the membership-at-large. This tension is a feature of sport governance requiring further research.
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National governing bodies need to capitalise on their ability to attract capable individuals to board roles and to consider alternative recruitment processes that yield more diverse board groupings better suited to juggling competing stakeholder demands and multiple organisational goals. Perhaps a distinction needs to be made between board directors (as volunteers) and service volunteers. Research that builds on work by Inglis and Graff (1997) which establishes a framework for volunteer-specific policies, particularly for board level personnel, is needed. More generally, further research that explores the multi-dimensional nature of the sport environment and considers new designs of governance to meet changing environmental conditions could contribute not only to the sport management literature, but also can contribute to the governance literature more generally.
There have been very few qualitative studies of governance. Most studies have used surveys and questionnaires, with some interview work undertaken. An in-depth, qualitative approach may better capture the diversity that exists in sport, and may gather new data in different ways that may assist in creating new governance designs. In addition, techniques such as action research could enable researchers to apply prescriptions, such as those set out by Carver (1997), to national sport organisations to determine how board and organisational performance might change. Developmental action research, as explained by Cardno (2003), could be used to discover ways to build board capability by working with sport organisations to identify those factors that constrain and enable the board to operate effectively.
A final comment on the literature explains the theme chosen for this review—board strategic capability. The themes and ideas discussed in this paper underscore a gap in our knowledge and understanding about the strategic function of the board. Gaps exist in the sport management literature on strategy development, while the corporate governance literature has not fully explored the role of the board in terms of its strategic contribution. Finally, the non-profit governance literature acknowledges the importance of strategic input by the board, but indicates that boards may not be active enough.
The small but growing body of knowledge on sport boards indicates that the evolutionary process of bureaucratisation and professionalisation has resulted in changing board roles and relationships with paid executives. The contribution of the board in strategic activities such as developing the vision and mission, engaging in strategic planning including monitoring and responding to external environmental influences, and considering long-term, big picture issues as and when needed, is a topic superficially explored by sport management scholars. Understanding the factors that both constrain and enable sport boards to think and act strategically may provide an empirical basis for sports to build their strategic capabilities. It may also contribute to the wider governance and sport management literature in this critical area of knowledge development.
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