This is the theoretical foundation for Policy Governance, the governing model implemented at Legacy Academy.
“The Policy Governance model takes as its starting point the principle that a governing board is accountable for the organization it governs and that it exists on behalf of a larger group of persons who, either legally or morally, own the organization. Since nonprofit and public organizations do not have stockholders, for them the concept of moral ownership may be the most valuable. This principle in itself separates Policy Governance boards from those that see themselves, often by default, as existing in order to represent staff, consumers, or other stakeholder groups of less broad legitimacy than shareholders–or shareholder equivalents. The principle forces the board to consider and answer the questions, From whom do we obtain our authority? and, To whom are we accountable? This is no easy task but is a necessary one, and it demands that the board distinguish theoretically between owners and other stakeholders, particularly customers.
“For most community organizations, the community as a whole owns the organization; for membership associations, the members are owners. Owners may be customers as well, of course, but these are separate roles that governing boards must learn to distinguish.
“When the board has decided to whom it is accountable, it must then settle the question of what it is accountable for. While statutes can sometimes help answer this question, Policy Governance suggests that a generic statement of any governing board’s accountability is that it must, acting on behalf of an identifiable ownership, ensure that the organization achieves what it should while avoiding what is unacceptable. This formulation sets the stage for the type of policy development necessary to implement the Policy Governance model. It also strongly implies some characteristics of the board’s job. First, in order to ensure that expectations are met, they must initially be stated, then delegated, and then checked for compliance.
Carver, John and Miriam., Reinventing Your Board. San Franciso: Wiley, 2006, pp. 17-18.