What is the governance framework aiming to achieve, and why is it important?
The main objectives of the proposed governance structure are:
first, to support the long term continuity and success of Partick Thistle;
second, rather than effecting wholesale changes, to create a framework for the Club which evolves from, and builds on, the current framework; and
third, without compromising the Club’s future success, to embed genuine supporter values in the governance architecture. Effective governance will ensure that the right people hold the key roles in the running of the Club’s affairs. Those individuals will be suitably skilled, experienced and “fit and proper” in accordance with regulatory requirements. They will have clearly defined roles and responsibilities and will operate within clear and transparent processes.
When will the governance framework be in place?
The framework will be in place when majority ownership of the Club is transferred from 3BC to TJF. When the shares change hands, ongoing stability and continuity within the Club will be crucial. TJF, 3BC and the Club will seek to ensure that the passing of control will be seamless, and changes in processes and procedures will be kept to a minimum.
Who will own the Club?
The Club will be owned by its shareholders, as is the presently the case. With approximately 55% of the shares, TJF will be the majority shareholder, and its shares will carry 55% of the voting rights. This means that any ordinary resolution put to the shareholders of the Club in a general meeting will be determined solely by the votes of TJF. Our percentage holding will also give us certain ancillary rights, including the right to call general meetings and to circulate suggestions for resolutions. Although TJF will be the controlling shareholder, it is important to remember that there will be other shareholders in the Club, holding the balance of the shares, and they will have the right not to be treated unfairly by the majority shareholder.
Who will run the Club?
The club board will be responsible for the management of the business of the Club. Responsibility for the day-to-day operation and running of the Club is likely to be delegated to an executive management team, in the same way as it is at present. Notwithstanding this delegation, the Club’s board will remain ultimately accountable to the shareholders for the Club’s performance. As controlling shareholder, TJF will be able to ensure the right people hold the key roles in the running of the Club, and also ensure that the strategic direction being taken is appropriate. But companies are not run by the shareholders, and TJF will not interfere directly in the Club’s operations. This principle lies at the heart of the proposed governance framework.
What business model will the Club follow? How will it fund its operations?
There will be no material change of direction from the business model currently followed. There will continue to be a prudent and sustainable approach to financial management. The Club will operate within the financial requirements set out in the UEFA and domestic club licensing systems. These rules encourage good financial management and are designed to ensure that clubs live within their means. They also promote long term investment in youth development and sporting infrastructure, so that clubs build for success. The Club’s revenues will be generated as they are now. Additional funding for the Club will come from the continuing pledges of our members.
How will the directors of the Club be appointed?
The board will be formally appointed in line with the Articles Of Association and affirmed by the shareholders at annual general meetings. They will also be subject to the statutory provisions relating to the removal of a director by ordinary resolution.
A Nomination and Governance committee of the board will be responsible for ensuring that proposed appointees meet the requirements of skills and experience that are needed. This will also include the directors who will be selected via TJF.
Will some decisions and actions of the Club require shareholder approval?
Under the articles of the Club, certain matters will be reserved for approval by Partick Thistle shareholders. In practical terms, the giving or withholding of approval will be determined by TJF as the majority shareholder. The detailed list of matters is not finalised at this stage, as we want our members to have their say on this during the consultation, but the Club and TJF will be working on identifying matters which are considered to be the most important and emotive issues in the longer-term interest of all supporters and the wider community. These include the sale of the Stadium or other Club tangible or intangible assets, changes to the Club colours, and changes to the Club name, nicknames, etc..
In addition to matters reserved for approval by the shareholders, we envisage that certain matters would be subject to prior consultation with TJF board. These would be set out in a “Working Together” document between TJF and the Club. This document will set out how the relationship between the Club and TJF should be organised, and will be an important element in the governance framework.
Who will ensure that behaviour and practices within the Club are consistent with good governance?
The Club’s board will have a responsibility to maintain effective governance (as it does at present). Under the scrutiny of TJF (as majority shareholder and also participating on the Club’s board), appropriate checks and balances across financial, operational and constitutional behaviour will be in place and regularly reviewed.
Further, the Nomination and Governance committee that is proposed will monitor the Club’s governance arrangements to ensure that good standards and practices are upheld.
Who will be the members of TJF in the proposed governance framework?
Our membership structure is based on the making of financial contributions. As majority shareholder we will want to remain an important source of funding for the Club. We believe, therefore, that our long-term membership structure should continue to be based on monthly pledging.
But we also want TJF to represent a large and diverse cross-section of the supporter community, and to foster a genuine sense of ownership and identity. So we will look at other forms of membership.
Our membership rules are flexible, and they can accommodate different categories of membership, including non-voting members and associate members. However, while looking at different forms of membership, we would not anticipate any departure from the principle of “one member, one vote”, and would not generally expect any great extension of voting rights beyond members who are active pledgers.
Will TJF distribute its shares in the Club?
TJF is a legal entity distinct from its members. We do not envisage TJF distributing its shares in the Club to the members, as we are strongly committed to TJF continuing as a long-term collective vehicle for supporter share ownership. Any such distribution to members would not be allowed within TJF’s articles. Similarly, we do not envisage circumstances in which TJF would pay a dividend to members.
Will there be any restriction on TJF selling its shares in the Club?
In theory, TJF could, at some point in the future, have to consider such a sale, although we cannot today envisage what the circumstances might be. We would certainly expect any power to sell shares to be subject to a super-majority of members, and may also consider that TJF be prevented from selling shares. We are seeking feedback on this issue.
How will the directors of TJF be appointed?
As with any company, the members of TJF will be able to appoint and dismiss the board of directors of TJF. Appointments to the board of TJF will be conducted by election involving all members and which will be recorded formally at an Annual General Meeting.
Detailed procedures for elections will be one of the primary tasks which the WG/Initial TJF directors of TJF will be obliged to produce..
How will members’ views be taken into account by TJF board?
To flourish as a member-owned organisation, we must engage effectively with the membership and provide opportunities for all members to voice their opinions. As a member, you will be able, as at present, to participate at general meetings of TJF, either in person or by proxy. You will be permitted to submit questions in advance of general meetings. Under the articles, members in general meeting will have direct say in various key decisions, such as changes to the constitution. If TJF is required to vote its shareholding in the Club for or against a matter which is important to supporters, the directors will consult with the members. The Chairman of TJF (who will not also be a member of the Club board), will have primary responsibility for connecting with the membership. We will hold regular meetings for members. Given we are in the digital age, we will also seek to use modern technology such as social media and electronic meetings to conduct discussion and debate, and to share information.
Who will ensure that good governance is upheld within TJF?
TJF’s board will have a responsibility to maintain effective governance. The directors will each have legal duties and responsibilities under the 2006 Act, and they will undertake in their letters of appointment to conduct themselves in a way which upholds the values of TJF and the Club, and to act with the highest standards of fairness and integrity. The “Working Together” protocols between TJF and the Club will also regulate behaviour and practices within TJF.
There is a perception in some quarters that supporter ownership of a club inevitably leads to instability and interference in on-pitch matters. What do you think? Will the Club be able to attract sufficiently good quality coaching staff?
We do not agree with this perception, and in designing the proposed governance framework, we have sought to refute it. The Club will be well-run, with a strong governance model and an unrelenting focus on financial and operational professionalism. Majority ownership of the Club will be through a properly governed supporter organisation, with checks and balances to ensure decisions are made in the right way by the right people at the right level. The governance structure will not give TJF and its members any direct power over the operations of the Club (although TJF representatives who sit on the Club board will obviously participate in board discussions and decisions). What the governance structure will do, however, is offer a proper route to participation and a wider sense of ownership to supporters who have demonstrated great loyalty and commitment to the Club and who want it to flourish. This will be healthy for the Club. Given this, we are confident the Club will be an attractive option for potential coaches, and we do not believe supporter ownership will erode in any way the Club’s ability to recruit and retain talented individuals.