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Trust Communication Regarding Operating Procedures

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Melbourne Cobbler
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« on: June 30, 2021, 00:36:53 am »

As some will be aware I recently emailed the Trust to obtain some clarity around their processes. As promised they have responded early this week. The full transcript of the email is below.

Dear Xxxx,

Please find below your questions with our responses attached in red.

I hope you find them helpful and please feel free to publicise.

Best wishes,

NTFC Trust


You may be aware through some of your colleagues and social media that a number of concerns have been raised regarding your operational processes and your commitment to the perceived intentions of your own mission statement by some members and supporters. You will no doubt be aware there have been a number of criticisms and objections that have have been raised at various points. Therefore I would like to take this opportunity to offer you the opportunity to respond to those allegations and alleviate the concerns raised by some. As an organisation that is run for the benefit of its membership and the well being of the football club, I would hope that you would be open to scrutiny. Additionally I would also hope you would welcome the opportunity to communicate your position and placate what appears to be a growing resentment by a section of your membership.
 
As a democratic, member-based organisation, we welcome scrutiny and engagement with members, as well as all stakeholders. We try to communicate effectively and are fully prepared to listen to criticisms and address them. We also acknowledge that no organisation is perfect and are prepared to improve if we fall short of expectations.
 
To that end I have a number of questions that I hope you will be able to answer and perhaps put some concerns that I have to rest. I believe that it also may give an interesting perspective of the views and processes of the board and provide some reassurance to those members who may be feeling increasingly disillusioned with their only meaningful representation with the club.
 
I have noted that there have been a few changes to the board of late, with the announcement of a further 2 stepping down on the 13th June. Please can you reiterate the full current process for electing members to the board?
 
The Trust was an industrial and provident society but became a community benefit company under changes in legislation in 2014. It is registered with, and regulated by, the Financial Conduct Authority. Community benefit companies are mutuals, with all members having a single vote, irrespective of the value of their membership contribution.
 
Under the legislation, community benefit companies must have a set of Rules, broadly equivalent to the Articles of Association in a commercial limited company. In common with approximately 90% of companies in the UK, the Trust adopted the ‘Model Rules’, published by a government agency, just as most companies adopt a standard set of articles.
 
The Rules state that one-third of the board of directors should ‘retire by rotation’ each year. In practice, therefore, a director can serve for a maximum of three years, at which point they must either present themselves for re-election or stand down. New directors can also be co-opted (invited) to join the board during the year but must stand for election at the next annual general meeting. The maximum number of directors and co-optees is set down in the Rules.
 
Persons wishing to become directors must be members of the Trust (again under the Rules) and be proposed and seconded by Trust members. If there are more nominations than available positions on the board, there must be a vote. Votes are cast before or during the annual general meeting.
 
For the last two years, the Trust has had less than the maximum permitted number of directors and has encouraged interested persons to put themselves forward.
 
It should be pointed out that in large public companies that are listed on the London Stock Exchange (specifically the FTSE-250), all directors must be re-elected annually under the provisions of the UK Corporate Governance Code. However, the Trust is neither a public company nor a listed company.
 
The Rules can be altered subject to a vote by members, provided the change does not conflict with the law. A majority of not less than 75% of those voting is necessary to do this.

 
As previously stated, myself and others have expressed concerns on social media regarding the amount of engagement and consultation The Trust board has with its membership. What is the official response of the board to address these concerns?
 
If matters are considered to be material to the mission and objectives of the Trust, or in the broader interests of the club and its supporters, the preferred approach is by electronic communication, but communications are also made by letter. We are somewhat constrained in reaching out to the entire membership, as we are bound by the provisions of the General Data Protection Register (GDPR), and although we have urged members to give consent this have not always been given or may have been overlooked.
 
There was recent criticism of the retention of the monies received during the crowdfunding initiative, but the Trust held a vote on this, open to members (and those who donated even if they were not members). The majority were in favour of the fund being retained should another crisis occur in the future (described by some as a ‘rainy day’).
 
The Trust also encouraged members to engage in the recent debate on football club ownership, prompted by the European Super League proposals. As a registered Trust, we were invited to make representations to the government enquiry chaired by Tracey Crouch, and felt that it was appropriate to ask members for their views.

 
There appear to have been some modifications to the mission statement of the Trust. For the record please can you state the decision making process the board would have undertaken to instigate any changes to the Trust mission statement?
 
The board has ‘tidied up’ the mission statement to make it more consistent with the objectives laid down in the Rules. However, two substantive changes have been made.
 
Firstly, the founders of the Trust envisaged that the supporters might own the club at some point in the future. The Trust has now played this down in the mission statement, as it has been made clear by the current owners (and their immediate predecessors) that they will not support or promote wider fan ownership. The Trust does have a small equity holding in the club (approximately 4%, reduced by the Cardozas from about 8% when they restructured the equity and abolished pre-emption rights). However, it is not felt that this aspiration is a realistic one for the time being, nor does it reflect feelings among the supporter base.
 
Secondly, the Trust stood down its objective to have Trust representatives on the board of the football club. In the past the Trust had one nominated director on the NTFC board (and at one stage two directors). However, the current major shareholders of the club have always been against this, as is their right, and in any event when the Trust did have a nominated director it served no purpose, as they could always be outvoted on any matter placed before the board. For example, under the previous ownership regime, the Cardozas ‘rubber stamped’ everything and rarely held formal board meetings.

 
These statements appear in the Trust mission statement.
 
A. To be open, democratic and inclusive in considering the needs and ideas of supporters.
B. We commit to being democratic, open, inclusive and accountable to the membership. Annual elections will be held for membership of the NTFC Supporters Limited Board - a third of the posts being open to election each year.
C. To encourage at least two NTFC Supporters Limited members, who are not board members, and representation of other NTFC supporters groups who are in sympathy with our aims and objectives, to attend regular meetings of the board.
D. We commit to supporting the aims and objectives of NTFC where, in the opinion of the board, these are not in direct conflict with the needs and best interests of supporters.
 
A. Please communicate the procedures and processes that best emphasise how this commitment is currently being honoured and adhered to?
 
If matters are considered to be of sufficient importance to the members or the future of the club, the board organises a public meeting or forum, as was the case during the ‘Cardoza crisis’. A similar initiative was the discussion of club ownership models held at the Park Inn.
 
It must be emphasised that whilst greater consultation and engagement is understandably considered to be important by members and other fans, the level of participation is actually quite low. For example, when the very future of the club was threatened before the Cardozas left, the Guildhall meeting barely attracted 200 supporters despite widespread national and local press coverage.

 
B. Please can you identify how these elections are to be conducted? May I request that any response includes the reason only a third of the positions are up for re-election.
Identify when the remaining positions are up for re-election? Finally regarding point B please confirm how this decision regarding the democratic process of the trust was arrived at?
 
Please refer to the first answer above. Generally, the Trust applied retirement by rotation (the one-third rule) as it is a standard practice of most small private companies, and nearly all community benefit companies. The Trust is open to nominations and places them before the annual general meeting. Voting can be in person, by post or by proxy, with results announced at the annual general meeting. Calls in the past for nominations from the wider supporter base have been largely unheeded. However, it should be emphasised that directors are expected to invest time and energy in the role on a purely voluntary (unpaid) basis.
 
C. Please can you clarify how any decision is arrived at regarding which individuals are to be invited to board meetings. Can you confirm how many members of the Trust can attend board meetings, and specifically how any decision regarding this matter was arrived at?
 
In the past we have welcomed up to two guests to meetings, though on occasions this number has been exceeded and it has never been necessary to impose strict rules in respect of this. The guests should be Trust members.
 
On very rare occasions it has been necessary to exclude guests from discussions when the confidentiality of third parties had to be protected. For example, this applied to some discussions of rescue efforts when it was clear that the future of the club was in jeopardy.

 
D. Can you identify specifically why this commitment to these aims is best served by being in the opinion of the board and not in the opinion of the general membership? Additionally how was the identification of the needs and best interests of the supporters established, particularly in conjunction with the commitment to inclusivity in considering the needs and ideas of those supporters?
 
Taking the last question first, the directors of the Trust are part of the supporter base of the club. They communicate with other supporters and have a good grasp of supporter sentiment. They can’t know everything and cannot always reconcile alternative views of different groups but can only do their best to reflect the general interests of supporters.
 
All members of the board of the Trust are devoted supporters of Northampton Town, and some are very long-standing supporters. However, as directors they have statutory duties under the Companies Act 2006, such as acting in good faith, exercising due care and diligence and exercising independent judgement. To discharge these duties properly, it is necessary to ask appropriate questions which may not always sit comfortably with the club and the wider supporter base. It is inevitable that sometimes there will be conflicting views, especially if a popular Chairman’s opinions are at odds with those of the directors.
 
The business operations of the Trust resemble those of any company. Much of the ‘ordinary business’ of Trust board meetings is routine and of little interest to the broader membership (such as minutes, matters arising, membership report, treasurer’s report and so on). On matters of greater importance and significance, discussion and debate is promoted through engagement with members, via public announcements, forums, social media and so on. It should be stressed that as in any company, not all Trust directors participate in all forms of social media, and when they do they are free to post in a personal capacity, which may or may not reflect the views of the Trust.
« Last Edit: June 30, 2021, 00:43:32 am by Melbourne Cobbler » Report Spam   Logged

Chairman, Paul Stratford Fan Club, and proud member of the Steve Massey Appreciation Society. (Although refuse to be in his fan club on account of his crap goal celebration in front of The Hotel End when playing for Wrexham)

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