Agenda item

To consider a progress report on individual risks identified in the Council’s Strategic Risk Register in relation to Governance.

The Committee considered a deep dive into the Strategic Risk “Governance” which included the sub-risks; (a) Non-compliance with the Council’s decision making process, (b) Failure of wholly owned companies and (c) Failure of key strategic partnerships.

(a)        Non-compliance with the Council’s decision making process

It was noted that the gross risk score of 20 in relation to this sub-risk was red and queried if there were any concerns that officers had in relation to it. Mr Steve Thompson, Director of Resources, stated that no specific concerns existed and explained that mitigation was in place through the Council’s governance framework which ensured that the risk would be managed.

Members also discussed the Equality and Diversity advice available with Mr Thompson explaining that the Council had a broad suite of mandatory training for officers. This had ensured that the correct culture in respect of equalities and diversity was in place, however it was noted that only one dedicated trainer existed in this respect. It was highlighted that further work to embed this culture would be achieved through the Elected Member Equality Champions.

The impact of the Lancashire Devolution Deal on the Council’s governance arrangements were highlighted with Mr Neil Jack, Chief Executive, reporting that a report on the deal and its impact on the Council would be provided to a future meeting of Full Council.

(b)        Failure of wholly owned companies

Members highlighted the identification of “robust conversations” as a control for this sub-risk and asked if this was a sufficient mitigation in this respect. Mr Thompson explained that the control existed as part of a wider range of controls. He highlighted the formal governance framework that was in place between the Council and wholly-owned companies (WOC) and the role of the Shareholder Committee. In addition to these formal and informal meetings took place regularly between officers and members of WOCs management teams. Further to this the Council ensured that a risk based approach was undertaken to each WOC that reflected the level of risk posed by each one.

An Ethical Statement outlining the expectations of the Council on how WOC operated was discussed. The statement had been drafted following the agreement of the companies governance framework and would be considered by the Shareholder Committee before being implemented. Mr Mark Towers, Director of Governance and Partnership, explained that the statement outlined the common business principles that the Council expected WOCs to take into account when making decisions.

The Committee also asked if there were any concerns that a WOC could fail and it was stated by Mr Thompson that ongoing monitoring ensured that the Council was kept informed of the WOCs’ financial sustainability. He added that he does provide Letters of Comfort to the companies and that the WOC group was forecast to make a surplus during 2023/2024. Mr Neil Jack, Chief Executive, added that recovery planning at the WOCs following the Covid-19 pandemic had progressed well, highlighting the improving performance of WOCs as a whole.

Resolved: That the report be noted.