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EFL Governance Review

Update from the EFL after meeting this week

1 March 2020

At its scheduled meeting this week, the EFL Board and its clubs were provided an overview of the reports prepared by Jonathan Taylor QC in relation to the EFL’s governance processes and structures and the independent review into the circumstances leading to the withdrawal of Bury FC’s membership of the League.

GOVERNANCE REVIEW

The EFL Board announced the Governance Review in March 2019, with the objective of ensuring that the appropriate constitutional and decision-making processes are in place to help secure the long-term sustainability of the League, its member Clubs and competitions. Mr Taylor and his Review team reported to, and took instructions, from a Governance Working Group (GWG) consisting of Debbie Jevans CBE and Simon Bazalgette, the independent directors on the EFL Board, and three EFL Club Divisional representatives, being Nick Randall QC (Nottingham Forest, Championship), Mark Palios (Tranmere Rovers, League One), and Colin Garlick (Port Vale, League Two). The recommendations made in the report are those of Mr Taylor and the GWG.

The review of governance structures has considered a wide range of issues including how members are represented, how decisions are made, and how rules are created and upheld across the League. After an extensive consultation phase, the report, which was provided to Clubs ahead of today’s meeting, recommended a number of changes to strengthen the EFL’s governance procedures, detailed below. These were endorsed by the Board following further refinement and received in principle support from member clubs at today’s meeting. Where proposed changes require amendments to the EFL’s regulations or Articles of Association, the formal process for enacting these changes will now commence and is anticipated to be concluded at the EFL’s AGM in June 2020.

It should be noted that the report also proposed that three new independent directors be appointed to the EFL Board, with a specific responsibility to represent member clubs. The majority recommendation was that these three new independent directors replace three of the six existing Club representatives on the EFL Board (three from the Championship, two from League One, one from League Two), with the other three club representatives remaining on the Board. The minority recommendation was that none of the six existing Club representatives remain on the Board. After careful consideration, the Board decided not to support any change to the current composition of the Board, as it believed this could undermine the objective of strengthening the relationship between the Board and member Clubs. EFL member clubs expressed their support for the Board’s position on this matter at the meeting.

BURY FC REVIEW

The EFL’s Board of Directors commissioned the Bury FC Review in September 2019 to review and assess the circumstances leading to the withdrawal of Bury FC’s membership of the League on 27 August 2019. In particular, the review considered the manner in which the EFL’s regulations and procedures, and the EFL’s policy in respect of insolvent clubs, were applied by the EFL to Bury FC, and to what effect.

In his report, issued to Clubs in advance of the meeting, Mr Taylor sets out in detail the chronology of events following the acquisition of Bury FC by Stewart Day in May 2013, its subsequent sale to Steve Dale in December 2018, and the eventual withdrawal of its membership of the EFL in August 2019. After considering the steps taken by the EFL at each stage, Mr Taylor concludes that the League spent significant time and effort monitoring the situation at Bury FC and applying its regulations to try to force the club and its owners to meet their commitments. He notes that while it can always be argued, with the benefit of hindsight, that more could have been done, any additional action would not have made any difference to the eventual outcome, which was ultimately caused by a lack of owner funding.

Under the terms of reference for the review, Mr Taylor was not required to make any recommendations regarding changes to EFL Regulations, However, his report makes a number of observations about potential changes which will feed into the ongoing reviews of divisional cost control measures provided for by the Profitability and Sustainability rules in the Championship and Salary Cost Management Protocol in Leagues One and Two, that are already being led by clubs and the review of other regulations and procedures being led by the Board. It is expected that specific changes will be brought forward for ratification at the EFL’s AGM in June 2020.

The two reports will be published on the EFL’s website in due course.


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