2024 Trends in Private Club Governance

What can we expect in governance in the year ahead? Stronger communication, more strategic boards and clubs that run like businesses basing decisions off data are trends Tom Wallace expects to see continue in the year ahead. Wallace, a partner with the firm Kopplin, Kuebler and Wallace, believes there are some key aspects that will become increasingly important in the governance realm in 2024. They are:

Surveying and Understanding Members. Clubs will move away from using committees as sounding boards and will do more loyalty and satisfaction surveys of members. “These surveys won’t be anonymous, they will include members’ names,” Wallace said. “If they aren’t willing to put their name on it, then they are thinking like a customer, not like an owner.” Removing the anonymity also means demographics add key data for club executives to understand the member’s age/background/etc. to help put the comments/suggestions/complaints in perspective. Without those demographics, it limits how club executives can lead and make decisions based on member feedback.

Responsibilities, Orientation and Education for Members. There will be a bigger focus on education and training for members, especially when they first join the club. Wallace believes that more explanation of the club’s responsibility matrix will happen during new member orientation rather than waiting until a member serves in a volunteer position. “There will be better education up front to make sure every member understands the governance model where committees are advisory, the staff is responsible for operations and the board is strategic,” he said. He believes more clubs will be better explained to new members that they are expected to serve on the board and/or committees. Not to imply forced volunteerism, but rather setting the expectation that members are asked to volunteer.

Human Capital Prioritization. Board members will become more involved in the club’s strategy for recruiting, hiring, retaining and training staff in the year(s) ahead. There will need to be a plan for the club to be an employer of choice. “While this is still a paid staff responsibility, boards will have to become partners in this initiative because it’s only going to become more challenging and cost more money. It is not getting any easier to hire people in the hospitality industry,” Wallace explained.

Board Portals. The biggest opportunity for boards in 2024, is the use of a third-party board portal service for all governance items. This is not a password protected area of the club website specific to board members which has been popular for several years. Rather, a third-party portal is an app online with a password which grants access to all club governance documents such as board/committee agendas, minutes, voting items, training videos, recurring education, supporting resources and more. All of these documents live in the portal so it is an easy way to communicate and stay more organized, functional and effective.

As boards trend toward less frequent meetings that may be longer to tackle strategic issues, using a third-party portal allows for more focus in the board meetings and for the board to have the ability to communicate and stay active in between meetings. It allows the minutia of committee agendas and other tedious issues to be handled in the portal and approved in advance of the board meetings. This way time spent in board meetings can be focused on strategic items. Wallace gave the example of approving an unexpected repair expense through the portal rather than scheduling a pop-up board meeting or waiting until the end of the month for approval.

Third party portals are customary for nonprofit boards and are beneficial because the platform tracks all voting, decisions, minutes, consent agenda items, what was approved or not, how long it takes people to view items and respond, who signs off on what, attendance and more. The portal is accessible by desktop or mobile device and it sends a text or notification to the person when something is posted they need to review. “The portal makes all the board and committee details very efficient, accessible and organized, which is why it presents such an opportunity for clubs to evolve their governance to the next level,” Wallace concluded. Some sample third-party portals are BellesBoard and Board Effect.

Private Club Advisor – January 2024

Tom Wallace, is a partner with KOPPLIN KUEBLER & WALLACE, a consulting firm providing executive search, strategic planning and data analysis services to the private club and hospitality industries. Tom can be contacted at tom@kkandw.com.