Strathspey Railway

The notion that shareholders hold Heritage Railway boards to account is a nonsense unless the shareholder is a society or trust that has a majority holding. Otherwise the vast majority of shareholders (as has been debated as naseum here) bought the shares as a “donation “ often so long ago they have forgotten they did. Certainly they will not be informed sufficiently about day to day matters to have a sensible viewpoint.

Volunteers have a deep commitment to their railway. They may not always be right about how it should be managed, but to get to the point where they organise a vote and a meeting indicates a depth of feeling and united feeling that in my view they should never have been made to feel. I am sure this was absolutely a last resort on the part of some very frustrated people, who will not have taken this step lightly or without great consideration.

I feel that the nature of the relationship between volunteers and their railway is such that the analogy to workforces striking in commercial businesses is only a very loose one. Most workforces do not desire the best for the organisation to the same extent.

So….boards beware, if you are faced with a volunteer walk out, you should get to the door before them!

 

That’s a very fair question which reflects 35B’s observation about mutiny in the Royal Navy. Their duty is owed to the Company and I doubt it would be fulfilled by resigning en masse leaving it without direction and control until the shareholders/ members can appoint replacements at a General Meeting. In a situation where, sadly, the regulator must already be looking carefully at effectiveness of the railway’s governance leaving it rudderless for at least three weeks seems particularly ill advised. Indeed in the circumstances reported, if they are accurate, I think the Directors duty is to remain in command of the ship until the admirals, in the form of the shareholders decide to replace them or leave them in command.
21B makes a good point about shareholder control compared to the influence of committed volunteers but unless the corporate structure is changed to something like a community benefit society that relative lack of volunteer control is enshrined by law.

 

Or, as I assume must have been hoped for when presenting the Board with the no confidence petition, a ‘last act’ of the existing Board could be to appoint new Directors, as allowable by the SRC’s Articles of Association, to lead the organisation. They would have to offer themselves for reflection (or stand down) at the next AGM, but the ship would not necessarily have to be rudderless. That assumes in the first instance that the target of the petitioners was to remove the entire Board, which I understand may not have been the case.

In better news, the railway has confirmed they are running as advertised tomorrow on social media.

 

That depends on whether the proxies have expressed wishes, or handed their vote to the chair. Two VERY different scenarios, and the implications for what that means in terms of support are correspondingly different.

@Lineisclear and I disagree on much, but I do agree with him on the legal situation here. The issue is that the legal framework does not adequately represent or describe the actual relationships involved, and prioritises capital against what are in reality more critical interests.

 

It very much depends on the accuracy of the press article. If the demand was that SOME of the directors should resign then it would be possible for the remaining directors to appoint replacements. Bearing in mind that all directors are equally responsible for past decisions regardless of how they voted individually they might be reluctant to penalise their colleagues for any failings for which they would remain equally accountable.
If the demand, as suggested later in the article, was that the ALL the directors resign then the organisation would be adrift and rudderless just at a time when it most needs to reassure external bodies that it has effective corporate governance in place.

 

Website states train services are operating normally tomorrow, but there will be refunds available for those booked who can't get to the railway due to the weather. Clearly sufficient staff available to run a service.

 

I'm sure this isn't your intention, but quite often your posts do come across, with respect the boards of heritage railway companies, that "when things are going well you shouldn't change directors, because after all - why would you, things are going well. Whereas when things are going badly, you shouldn't change directors, because above all else the railway needs stability in a crisis!"

T0m

 

Happy to agree with 35B although the nature of a proxy vote ( vote as instructed or use your discretion) doesn’t just affect proxies granted to the chairman. That choice also applies where the member/ shareholder appoints someone else as their proxy. What some seem to find objectionable is that an individual member’s proxy vote should carry the same weight as that of someone making the effort to attend the meeting so, as a previous post complained about, a vote on a show of hands of those present may be reversed when proxies are taken into account. If each member has a vote they should all carry equal weight.
I just dislike proxies generally. They facilitate proxy garnering whether that’s by the company to ensure resolutions go through or by pressure groups encouraging members to lend them their votes. Postal or electronic voting seems to be a preferable solution.

 

You’re right Tom. All I’m pointing out is that there are legal constraints on the way such change can be made and that doing so affects a wider constituency than the members/shareholders and volunteers.

 

Without ever having chance to visit the railway I have no idea of the issues.
But this report from the paper seems to me, the uninitiated to have a lot of conflicting angles that maybe do not make sense (at least to me)
How many are involved in this "mass walkout"?
Are they volunteer or paid staff? Contracted hours is talked about.
Many of the issues appear to be those that you would get if you asked staff at many companies. I thing I have seen all those issues listed on wnxx from rail staff moaning around issues in relation to the strike. I also know a number of colleagues who would have listed all of those and more at my employer.
Is it real "bullying" or is it as I have seen many times in the later years before I retired, I do not agree with a certain direction but being told to do it by management =bullying.

There may be big issues, but this and another press report I have seen do not explain it.

Also surely telling people not to attend due to the storm is be praised not criticised. Not much duty of care in getting staff or volunteers to come in when people were being told not to travel.

 

It does suggest that many heritage railway structures are wrong, for two reasons:

1. Although they are legally separate entities, in practical terms there is generally a high degree of overlap between members, shareholders and volunteers
2. In a traditional company, the capital is seen as the greatest asset, so the shareholder interest is paramount. However, in a heritage railway set up, the contribution (possibly over many years) of volunteer labour is essentially unvalued, yet at any reasonable valuation is likely to be of far higher value than the shareholder investment. (A case in point would be a group that spent £10,000 on materials to restore a carriage, and put in 5,000 volunteer hours doing so - the volunteer investment is far higher than the cash, but only the cash appears on the company balance sheet).

While I don't think our structure is perfect, I am quite glad that it is enshrined in our articles that the membership body, which is closely aligned to the volunteers, must remain the majority shareholder of the operating company! We have recently pulled back from the brink of what could have been a catastrophic divergence of a company board acting in isolation of volunteer views while thinking it knew best.

Tom

 

Or the NYMR model where the charity that owns the railway, and which voting members join, has the only voting shares in its operating subsidiary.

 

And previous discussions about a number of railways highlight how a focus on pure legal form may mislead as to the implications of voting structures.

Ultimately, whichever way round the society/company structure, these are organisations reliant on the donations in money, kind and work of supporters for their viability. If the decisions are bad, or the leadership lose the confidence of the active base, their future is in grave doubt.

The use of proxies needs to be considered in that light, where the grant of an open proxy to the chair is an open invitation to that chair, especially where they are themselves a protagonist in a dispute, to use the vote in a partisan way. It is legal, but it is not moral.

PS - the above is written as a general observation on governance and in ignorance of the specific issues at Strathspey.

Sent from my iPad using Tapatalk

 

I have been critical of the way John Bailey has driven the changes to the NYMR Board, and therefore I'm not surprised by his apparent support for the Strathspey Board, who seem to me to be showing similar arrogance - he seems to favour an approach of "you amateurs have done well so far but now it's time to go and play with your toys while the grown ups take charge". I fear its an approach that is going to take more than one line to the brink - and possibly past - before common sense prevails and it is appreciated that those who built up the successful lines more or less from nothing actually did - and do - have a very good idea of going about things. They might need some professional assistance but that shouldn't mean they should be elbowed aside.

 

Roger’s dislike of the way the NYMR has developed is hardly news. Much as he seems to enjoy personal attacks it’s ridiculous to personalise something that reflects the collective decision of elected Trustees and, yes, the continuing support of members and volunteers. ( A recent NYMR volunteer survey confirmed extraordinarily high levels of intention to carry on supporting the railway).
How pointing out the means by which directors can be changed legitimately can be interpreted as support for the Strathspey board is beyond me.
What is likely to take heritage lines to the brink and beyond is blinkered refusal to acknowledge that the world which they have to survive has already changed radically and is still changing. The most dangerous attitude is “we’ve always done it that way because it worked in the past”. Ability to adapt is what will distinquish the survivors from the casualties.
Michael Whitehouse’s perceptive article in the latest issue of Steam Railway should be compulsory reading for those determined to cling to the old way of doing things.

 

As an attendee for the whole of the aforementioned meeting, two people left during the meeting and about another four just before the very end. I estimate there were some 120 in attendance.
Just for interest, the engine shed has one member of staff and some 12 -15 volunteers of varying attendances. If we were elbowed out I think it would be somewhat struggling.

 

I am not opposed to change. As Chairman of the LNERCA I had to struggle quite hard to convince my fellow Trustees that the way forward was to concentrate on fundraising so that paid help could be engaged to speed the restoration progress up. Some quite prominent fellow Trustees felt that it was losing the spirit of the organisation and that only the bare essential professional help should be paid for. What I feel with the NYMR is that the baby has been thrown out with the bathwater. It isn't just me that feels that the abysmal level of communication towards volunteers and supporters is symptomatic of a railway that is now run primarily for the benefit of its paid employees (who now have a dominant position on the PLC Board) and heritage is paid lip service to as little more than a fundraising gimmick rather than a raison d'etre. I honestly don't see that as the basis of a long term future, and if I am critical of John it is because I feel it has largely been his personal mission to instigate those changes. In both the Strathspey and L & B threads he has consistently demonstrated that his interpretation of company law seems wholly unsympathetic to those members and volunteers who are now struggling against entrenched managements. I haven't read Michael Whitehouse's article as yet, but I suspect it has less to do with managerial issues than financial matters.

There might be a high level of volunteer satisfaction at the moment, but it only takes a unsuitable replacement GM to undo that in a matter of months. I don't know how long it has taken at the Strathspey, but supporters of the WSR and SVR would back me up, I think!

 

Ahh but Mr Bailey when you say the ‘Ability to adapt is what will distinguish the survivors from the casualties’ is what happens when it’s occurred to those below deck that that bloody big iceberg is right ahead and those at the on the bridge can’t see it or refuse to see it and say ‘nah, steady as she goes.

 

If the iceberg is as close as you suggest how does some of the crew abandoning ship help save it?