Key skills and characteristics for CEOs of Arm’s-Length Bodies

In the first research of its kind, the Association of Chief Executives (ACE) and management consultancy Nous Group have identified the capabilities and characteristics needed to thrive as a CEO in an Arm’s-Length Body. 

Arm’s-Length Bodies (ALBs) play a pivotal role across all aspects of society and public service delivery. Generally speaking, ALBs include parts of government that are neither ministerial departments nor courts and tribunals nor public corporations. They exist in both the central government and the devolved administrations.

ALBs exist where it is appropriate that a public function has a degree of independence from the government of the day. This may be because day-to-day oversight is unnecessary, for example, VisitBritain, or because separation is necessary for public probity, for example, the Parole Board. Across the UK, there are around 400 arm’s-length bodies employing over 85,000 staff. 

On the initiative of Phil Golding, CEO at the Law Commission, and Samantha Milton, Head of the Public Defender Service, the Association of Chief Executives commissioned Nous Group to explore the skills ALB CEO’s need to thrive. While effective leadership is important for any organisation, it is recognised that ALB leaders face different challenges from other leaders.

Based on 30+ interviews with CEOs and board members, and a survey among leaders across ALBs, the researchers outlined skills and attributes that define a successful ALB CEO, across four broad categories: 1) policy leadership skills; 2) corporate leadership skills; 3) sector leadership skills; and 4) personal characteristics.

POLICY LEADERSHIP SKILLS

Work effectively with ministers and government departments – other individuals and institutions in the executive branch have substantial influence over an ALB’s operating environment and successes. Understanding how to align an ALB’s priorities with those of ministers and departments is essential. 

Engage well with parliamentarians – parliamentarians, including committee members, provide an essential oversight mechanism for ALBs, shape what is possible for the ALB are the elected voice for their constituents. ALB leaders need to recognise their democratic role and insights. 

Understand how to drive policy change through appropriate channels – government decision-making processes can include checks and balances, stakeholder consultations and steps beyond those expected in other sectors. Effective ALB leaders will understand the system and how to work within it to achieve change. 

Recognise the government’s political context – ALBs have a degree of independence from government but this is not absolute. Effective ALB leaders can balance independence with respect for the governmentof-the-day’s mandate and direction of travel. 

CORPORATE LEADERSHIP SKILLS 

Provide stewardship, strategic direction and purpose – ALB leaders cannot do everything in their organisation. Instead they need to provide the clarity of purpose to enable others to act in line with strategic priorities. 

Drive organisational change – all organisations undergo periods of consolidation and transformation. ALB leaders need to manage the changes that occur during each.

Lead for operational outcomes – most ALBs have clear operational priorities outlined in their legislation or through guidance from ministers or the board. Effective CEOs lead to achieve these outcomes.

Access your organisation’s full capabilities – ALBs include staff members with a diverse range of skills and personal attributes. Top leaders will lead in a way that encourages all team members to put these to the organisation’s shared priorities.

Meet your legal obligations – ALB CEOs have specific legal responsibilities in their position as the accounting officer. CEOs need to recognise the importance of this role and perform it well. 

Delegate effectively – CEOs must work through people. Making the right judgements to delegate well with appropriate oversight is necessary.

Act commercially – an ALB CEO needs a commercial orientation where they focus on achieving the effective, efficient and strategically appropriate outcomes. 

Focus on results – ALBs have measurable output and outcome performance indicators. Effective leaders focus both on these and on the more holistic results that they exist to achieve.

Work through others – no ALB leader can realise their ALB strategy alone. Instead, they find ways to draw on others to do the heavy lifting. 

SECTOR LEADERSHIP SKILLS 

Understand your ALB’s place in the sector – each ALB has a specific importance, role and perception in its sector. Effective ALB leaders will work with this history, rather than ignoring it. 

Know your customers – sector knowledge includes both policy knowledge and knowing the right people and the rights levers. ALB leaders must either have this people knowledge or have the capacity to gain it. 

Credibly explain your ALB’s value to the sector – no ALB is universally loved within its sector. Effective ALB leaders can convince a sceptical sector of the value in their institutional role and current strategy.

Master the sector’s policy environment – all sectors of the UK’s economy and society have a distinct history of regulatory change. Understanding the current environment and previous changes supports impactful and credible engagement with the sector.

Balance detailed sector knowledge with a wider lens – ALBs are a part of their sector and of the government-at-large. Effective ALB leaders bring detailed knowledge to whole-government assessments and vice versa.

PERSONAL CHARACTERISTICS 

Be curious – ALBs and CEOs learn best practice from other organisations across all sectors in the UK and abroad. The best leaders will look to all these examples to continue to improve. 

Show resilience – ALB leadership is rewarding but it is hard. Sustainable leadership requires a personality that can deal with hard challenges, even when they seem unfair.

Appreciate complementary skill-sets – no person can have all of the capabilities that a leadership team requires. ALB leaders need to build teams that collectively have the necessary skills. 

Demonstrate sound judgement – ALB leaders make hard decisions. Leaders must bring together the evidence to make the most appropriate decision. 

Have a customer-focus – ALBs exist for specific purposes and effective ALB leaders exemplify a focus on the people, organisations and causes that the ALB exists to serve.

Listen well – ALB leaders receive solicited and unsolicited feedback from diverse sources – there are lessons in each of these and ALB leaders benefit from understanding them. 

Challenge upwards and downwards – ALB CEOs sit between systems. They need to be able to assertively and respectfully engage with stakeholders in all directions. 

Communicate clearly and well – ambiguity has a limited place in leadership. Effective ALB leaders ensure that people do not have scope to misunderstand them, their strategy or their mission. 

Show empathy – ALB leaders cannot solve every problem within their remit. But effective leaders will demonstrate that they understand what drives and influences others’ behaviour.

Be consistent – ALB leaders will be most effective when stakeholders know what to expect from them and can engage with them on a ‘no surprises’ basis.

Engage well with stakeholders – no ALB operates in isolation. Effective leaders will understand their ‘collective stakeholders and proactively work with them.