Board of Trustees Meeting, 5 September 2011

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Board Room, National Library of Scotland, George IV Bridge Building, Edinburgh.
13:30

Present: Professor Michael Anderson (Chairman); Andrea Batchelor; Catherine Dyer; Lorraine Fannin; Professor David Finkelstein; Dr Peter Kemp; Jonathan Lake QC; Charles Lovatt; Councillor Gordan Low; Moira Methven; The Lord Advocate Frank Mulholland QC; Dr Richard Parsons; Dr Willis Pickard; Malcolm Scott QC; James Wolffe QC.

In attendance: Duncan Campbell (Director of Corporate Services); Dr Darryl Mead (Acting Director of Collections and Research); Alexandra Miller (Director of Customer Services); Martyn Wade (National Librarian and Chief Executive); Susan McKenzie (Finance Manager); Jan Usher (TUS representative); Janice McFarlane (minutes).

Apologies: The Lord President of the Court of Session; Marco Biagi MSP; The Minister of the High Kirk (St Giles') Edinburgh; The Lord Provost of Aberdeen; The Lord Provost of Edinburgh; Mungo Bovey QC; Professor Graham Caie.

The Chairman (MA) opened the meeting by welcoming the Lord Advocate, Frank Mulholland, to his first meeting of the Board.

 

Minutes of meeting

1. Apologies

As noted above.

 

2. Minutes of meeting of 20 June 2011:

The minutes were approved as a correct record apart from two typographic errors.

Janice McFarlane (JM) will amend p.6: 'Lorraine Fannin', and p.9 'adoption of a "pull" model'.

 

3. Actions outstanding and matters arising:

Item 4.3.4. Actions outstanding: Completion of purchase of John Murray Archive:

  • A report to be prepared for Trustees on the fundraising campaign for JMA
    Update: Paper BT/11/48 presented under item 14 of Agenda.
  • A new fundraising strategy to be prepared for consideration by the Board's Development Committee
    Update: Development Committee meeting 9 September 2011.

Item 4.3.8. Audit Scotland report:
Find a format for reporting on health, safety and security issues to the Board.  
Update: Outstanding. DC will report to Board on 24 October 2011.

Item 4.7. 'Connecting Knowledge':   Implementing the strategy:

  • Half-day seminar for Trustees and senior staff to be arranged for May 2011.
  • SMT to look at this as a first stage and then lead discussions with Trustees.

Consider the use of electronic tools, such as wiki, to continue discussions following the seminar
Update: Seminar/ workshop on spending priorities held 24 August 2011. Report included as BT/11/47 under item 13 of agenda.

Item 7. Shared Services Proposal:
DC will provide Trustees with a risk assessment for the managed service model, and ensure risk assessments are provided for each shared service.
Update: Risk assessment completed and reported to Governing Board 26 August 2011. Update will be provided by P Kemp under agenda item 16c.

DC will ensure that clear timeframes are provided for each shared service project, including the incorporation of review dates.
Update: Requirement for clear timeframes noted for future.

MW will meet with TUS on 21 June and ensure that information on shared services will be provided at staff meetings.
Update: All-staff bulletin on shared services circulated 3 August 2011.

Item 9. Policy for breaches of NLS terms and conditions:
Text will be amended to reflect Trustees’ recommendations.
Update: Done

An equalities impact assessment (EIA) will be added to the paper.
Update: EIA completed and  signed-off 25 August 2011.  Copy included in BT/11/39.

The policy will be publicised across the LIS sector through library networks, and article in Information Scotland, and other means as appropriate.
Update: Publicity will commence once policy on website.

Item 10. Fellowship of the National Library of Scotland:
JM will amend the term 'application form' to read 'nomination form' as soon as possible.
Update: Term amended.

MW will draft guidelines and a nomination form for consideration by GWP by Autumn 2011.
Update: David Hunter (DH) has drafted a nomination form for consideration by Governance Committee on 8 September 2011.

Item 12. Quarterly Management Accounts:
SM will review the level of detail provided in reports to the Board and Audit Committee over the next six months.
Update:  Comments from Trustees have been noted and taken into consideration in the preparation of management accounts.

SM will revise the wording of the report to provide a clearer and more accurate explanation of expenditure before the accounts are presented to the Audit Committee.
Update:  Taken note of for future accounts.

JM and SM will ensure that commercially confidential information is dealt with appropriately in future accounts.

Item 13. FOISA Publication Scheme:

  • Confirm the Freedom of Information status of the Agency for the Legal Deposit Libraries (ALDL) (as soon as possible)
  • Include information on the role of the Board of Trustees in the section entitled 'How the Library takes decisions …'
  • Add the word 'limited' to the text relating to inter-library lending service.
  • Amend the text of the hyperlink to reflect the fact that Board minutes, and not just summaries, are available on the website.

Update: ALDL is covered by FOISA and information will be included in NLS publication scheme. All other changes made as requested.

Investigate and implement changes to facilitate version control relating to Board papers. (As soon as possible)
Update:  Outstanding. JM will investigate and draft recommendations as soon as possible.

Item 15. Report on the Agency for the Legal Deposit Libraries:
MW will report back to the Board, at the next meeting, on any technical risks which may arise due to the review which is due in Q3.

MW will investigate the option of commissioning the British Library to carry out a review of the ALDL.

Update: MW will provide a verbal report under item 15 of the agenda.

Item 16: Minutes of the meeting of the Staff and Remuneration Committee:
Three Board Committees — Staff and Remuneration, Development, and Investment — are currently below strength. Trustees who are interested in joining any of these Committees should contact the Chairman as soon as possible.
Update. Volunteers obtained for Staff and Remuneration and Development Committees. See BT/11/40, item 6 of agenda.

Item 18: Draft minutes of the Development Committee:
Any Trustee willing to take on the role of Chair of this Committee should contact the Chairman as soon as possible.
Update:Update under item 6 of agenda.

 

Matters arising:

Shared Services: In response to questions concerning the suggestions made at the last Board meeting regarding changes to the Shared Services Terms of Reference, Trustees were informed that the suggested modifications would be presented to the Shared Services Management Board and then brought back to the next Board meeting.

Policy for breaches to NLS terms and conditions: Trustees expressed their approval of the Equalities Impact Assessment included in paper BT/11/39, which was considered to provide a good model.

 

4. Presentations for future meetings:
MA encouraged Trustees to submit suggestions for presentations which could be incorporated into future meetings of the Trustees. A suggestion was received to include a presentation on the NLS Learning Zone at a future meeting.

 

5. Declaration of interests:
Trustees confirmed that there were no declarations of interest regarding the substantive items on the agenda. MA reminded Trustees that they were still required to declare an interest in any unexpected issues that emerged during actual discussion of agenda items.

 

6. Committee membership:

MA presented a paper to the Board, requesting the approval of the Trustees for the appointment of new members to Board Committees.

Trustees were reminded that there were still vacancies on the Investment and Development Committees.

The Board approved the appointment of Jonathan Lake QC to the Development Committee and Dr Willis Pickard to the Staffing and Remuneration Committee.

JM will forward the terms of reference, dates of forthcoming meetings, and other relevant documentation to the new committee members.

 

7. Loans to exhibitions: Requests for approval:
Darryl Mead (DM) presented a paper requesting the Board’s approval of items for inclusion in external exhibitions.

In response to a query concerning the length of time an item would be on exhibit at the Museum of the City of New York, Trustees were informed that this provided a positive opportunity for the Library. It provided a study opportunity for NLS staff, and could also provide a test case for developing regular fundraising events with our American Patrons, which could involve NLS curatorial staff providing talks on one or two items chosen for exhibition in the United States.

The loan requests were approved.

 

8. Special Collections Reading Room:

DM presented a paper, accompanied by a PowerPoint presentation, requesting the Board's agreement to the creation of a new Special Collections Reading Room on level 15 of the George IV Bridge Building. Trustees had been given an opportunity to visit level 15 prior to the meeting.

MW informed the Board that, due to changes in the Scottish Government's policies regarding carrying forward unrestricted reserves, it was necessary to take this project forward during the current financial year.

DM highlighted the improved and expanded facilities which would be available, and provided an outline of the project budget.

During the ensuing discussions the Board received confirmation that security and conservation staff are happy with the proposals. Currently there are no confirmed plans for the use of the space which would be released on level 13, although several options are being looked at. Staff, currently housed on level 15, would be relocated to Baden Powell House.

The Board agreed to the move of the Special Collections Reading Room from level 13 to level 15 during the current financial year, with affected staff being relocated to Baden Powell House. 

The Board also agreed that overall project funding of £220,000 be made available from NLS reserves.

The Board agreed to receive agenda items 16a and 16b at this point, as they provided background information of relevance to the item on the Control Environment Review.

 

9. Minutes of the Audit Committee of 27 June and draft minutes of the Audit Committee of 24 August:
These two items were considered together.

In the absence of Malcolm Thomson QC (MT), Charles Lovatt (CL) presented the minutes of the meeting of 27 June, and provided a verbal report of the meeting of 24 August, which he chaired. It was noted that the written draft minutes of the latter meeting would be provided to the next meeting of the Board.

CL highlighted the committee’s response to the Control Environment Review which resulted from an internal audit carried out by Baker Tilly in November 2010. While the committee was generally disappointed with the approach taken by Baker Tilly, and the unfocused nature of the report, it did identify various areas which management needed to address. These included the need to revise the Library’s management structure, and this was currently being addressed.

CL emphasised that the successful operation of the Control Environment required the early appointment of the Head of Audit and Review.

In response to comments made by the committee on 27 June, a revised paper was presented on 24 August and approved by the committee, subject to the inclusion of further details regarding timescales and the identification of responsible persons. An updated report, incorporating these changes was now being presented to the Board.

CL informed the Board that, after discussions and the approval of an agreed remit, the committee had recommended to the Chairman the appointment of Professor Ian Percy as an external assessor to review the response of management and the committee to the misappropriation of funds. 

CL also highlighted that the proposed three-year internal audit plan was not approved by the committee pending receipt of the report of the external assessor. A revised plan, reflecting any recommendations included in that report, will go back to the next meeting of the committee. The report of the Short-Term Working Group on Income Generation was also deferred due to lack of time.

The Board was asked to approve the committee's recommendation that the contract with Baker Tilly be extended for one year, to end-March 2013.

The Board approved the recommendation to extend the Baker Tilly contract, and noted the report.

 

10. Control Environment Review:

DC presented a paper seeking the Trustees' approval for the actions agreed in the Control Environment Review. MA reminded Trustees that they were responsible for ensuring that the Board was satisfied with the approach taken by management and that items of detail were being appropriately handled.

The paper presented a summary of the priority recommendations and the actions being taken to address them. The key categories identified were:

  • Streamlining the management structure
  • Forward job plans
  • Cross-library meeting structure
  • Risk management
  • Key performance indicators (KPIs)
  • Control environment.

As requested by the Audit Committee, details of timescales and responsible persons had been added to the paper, previously conditionally approved by the committee. A proposed timescale was also provided for the recruitment of the Head of Audit and Review.

The ensuing discussions highlighted issues relating to risk management and the Corporate Risk Register. It was agreed that DC would provide a brief, updated report to each meeting of the Board, highlighting any significant changes in the risk profile.

There was also some discussion concerning the relevance of KPIs and the lack of information quantitative indicators provided on progress against some key parts of the corporate plan. While recognising that KPIs can sometimes be misleading, the Board was reminded that they do help in identifying trends.

Following these discussions the Board agreed it was satisfied with the approach taken by management.

 

11. Annual Report and Accounts 2010/2011:
Susan McKenzie (SM) presented the annual report and accounts to the Board for approval. 

SM reminded Trustees that the report and accounts had been previously circulated to Trustees for comment, and had been discussed by the Audit Committee. 

It was reported that Audit Scotland had not raised any specific issues. Two minor issues were clarified:

  • Audit Scotland agreed that group accounts in relation to ALDL are not required on grounds of materiality, but this decision will be kept under review.
  • Prior year adjustments relating to the removal of the Graham Brown Trust Fund from NLS accounts, as these funds are separately accounted for by the Trustees of the Fund.

The Board was also notified that, as Audit Scotland had come to the end of its contract, Price Waterhouse Cooper (PwC) had been appointed to act as the Library’s external auditors for the next five years. In response to a question, the Board was informed that the appointment of external auditors was under government control.

The Board was informed that, as a result of the misappropriation of funds, a Section 22 report will be submitted by the auditors, following on from the Section 22 report submitted with the 2009/2010 accounts. MW will be meeting with Audit Scotland to discuss the content of the report.

During the ensuing discussions it was noted that, due to the work involved in introducing the new finance system, fewer invoices had been paid within agreed timeframes. A reduction in the expenditure on travel, subsistence and hospitality was also noted. However, it was recognised that some hospitality was frequently required as part of the Library's fundraising activities. It was agreed that expenditure on hospitality would be reported separately in future accounts.

The Board approved the annual report and accounts.

 

12. Quarterly Management Accounts:
SM presented the Board with a report of the financial results for the first quarter of 2011/2012. The report had previously been reported to Senior Management Team and to the Audit Committee.

SM highlighted the changes in the presentation of the accounts, which allowed more a more effective drill down into variances. This improvement was as a result of the introduction of the new finance system.

It was noted that an explanation for a variance in capital expenditure in relation to Joint Legal Deposit was outstanding. It was agreed that an explanation would be provided.

The Board noted the accounts.

 

13. National Librarian and Chief Executive report:
The Board received a report which provided information on recent Library developments not otherwise covered by the agenda of the meeting.

MW highlighted the donation of the Lord Byron memorial book. The Trustees requested MA to write to the donor expressing their gratitude.

MW also informed Trustees that they would be invited to join Library staff at the annual World’s Biggest Coffee Morning, which is held on behalf of Macmillan Cancer Support, on Friday 30 September.

The Board noted the report.

 

14. Trustees' Seminar 24 August:

MW presented a short paper summarising the Trustees’ discussions of future planning and spending priorities during the seminar held on 24 August 2011. The seminar had been a positive and constructive event. Trustees who had not been able to attend were invited to contribute further comments and suggestions.

Trustees were informed that information on the Library's grant-in-aid was expected on 21 September. Although not yet confirmed, it is expected that this notification will cover the grant over the next three years. Cuts are expected, and, Trustees were reminded that the Library will also be undertaking a management re-structuring over the next months.

It was noted that management would use any suggestions on spending priorities as providing broad guidance for future planning. MW will report back to the Board at the meetings scheduled for October and December.

The seminar had highlighted the importance of protecting digital resources, the collection of Scottish material, and curation. It was noted that curation, not curators was emphasised and Trustees were informed that the Library will be reviewing staff skills during the autumn. It was agreed that a clear definition of what was meant by curation was required. This will be followed up by MW and TUS.

The Board noted the report.

 

15. Report on Agency for Legal Deposit Libraries (ALDL):
MW presented a paper providing Trustees with an update on the performance of the ALDL.

This was the fourth of the quarterly reports requested by Trustees in October 2010, in response to some concerns regarding the potential risk to the reputation of NLS if the ALDL did not perform to an appropriate standard. 

The Board was informed that the performance of the ALDL was now the responsibility of the Legal Deposit Libraries (LDL) Board, and it was suggested that, in future, the ALDL should provide Trustees with an annual review at the end of each year. However Trustees felt that the ongoing performance of the Agency could still impact on the reputation of the Library, and requested that brief quarterly reports, providing information on intake levels, should continue to be presented to the Board.

JM will correct a typographic error found in section 3 of the report. 

The Board noted the report.

 

Lorraine Fannin left the meeting at this point.

 

16. Draft minutes of the Shared Services Governance Board, 26 August 2011:
Peter Kemp (PK) provided a verbal report of the meeting of the Shared Services Governing Board.

The report highlighted: 

  • Comments made by Trustees, at the previous meeting of the Board, had been taken on board by the Shared Services Management Board.  Amendments will be presented to the Governance Board in October, and will be brought back to Trustees at the following meeting of the Board.
  • The Governance Board had reviewed the job description for the Shared Services Review Manager post and was proceeding with the appointment process.
  • IS integration work largely completed and will provide future savings.
  • NGS and NLS now using the same finance system, but there is still significant work required to develop a full shared service which would strengthen resilience and allow the sharing of expertise.
  • Project Initialisation Document relating to the HR project has now been signed off, as agreed by the Board in June.

The Board noted the report.

 

17. Any other business:
There was no other business.

 

Date of next meeting:
Monday 24 October 2011.

 

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