Board Member Operating Model · 3.8 Data and Information Management ... Figure 1 Board Member...

Board Member Operating Model

July 2016

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BOARD MEMBER OPERATING MODEL

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CONTENTS

LIST OF FIGURES .............................................................................................. IV

GLOSSARY AND USE OF TERMS ......................................................................... 1

1 INTRODUCTION ........................................................................................... 2

1.1 Overview of the NEB .............................................................................................. 2 1.1.1 Purpose of the NEB ................................................................................................................... 2 1.1.2 NEB Responsibilities .................................................................................................................. 2

1.2 Board Member Operating Model Background ........................................................ 3 1.2.1 Introduction ................................................................................................................................. 3 1.2.2 Purpose ...................................................................................................................................... 3 1.2.3 Benefits ...................................................................................................................................... 3

2 OVERVIEW OF THE BOARD MEMBER OPERATING MODEL ................................ 5

2.1 Introduction ............................................................................................................ 5

3 BOARD MEMBER OPERATING MODEL DIMENSIONS ........................................ 6

3.1 Strategy .................................................................................................................. 6 3.1.1 Introduction ................................................................................................................................. 6 3.1.2 Government of Canada Reporting Obligations .......................................................................... 7 3.1.3 Strategic Planning Process ........................................................................................................ 8 3.1.4 Strategic Priority Setting ............................................................................................................. 9 3.1.5 Performance Indicators for Strategic Priorities ........................................................................ 10 3.1.6 Quarterly Review and Reporting of Performance Indicators ................................................... 11

3.2 Board Member Structure & Governance .............................................................. 11 3.2.1 Introduction ............................................................................................................................... 11 3.2.2 Governance .............................................................................................................................. 11 3.2.3 Roles, Responsibility and Accountability ................................................................................. 12 3.2.4 Board Member Committee Governance and Structure ............................................................ 17

3.3 Risk Management & Controls ............................................................................... 18 3.3.1 Introduction ............................................................................................................................... 18 3.3.2 NEB Risk Management ............................................................................................................ 18 3.3.3 Board Member Involvement in the Risk Management Process ............................................... 19

3.4 Board Member Engagement ................................................................................ 20 3.4.1 Introduction ............................................................................................................................... 20 3.4.2 Board Member Engagement Approach.................................................................................... 20 3.4.3 Board Member Engagement Principles ................................................................................... 21

3.5 Board Member Internal Interaction ....................................................................... 21 3.5.1 Introduction ............................................................................................................................... 21 3.5.2 Behaviours ............................................................................................................................... 21

3.6 Board Member Process Management .................................................................. 22 3.6.1 Introduction ............................................................................................................................... 23 3.6.2 From the DRF to the Four Core Operating Processes ............................................................ 23 3.6.3 Core Operating Processes ....................................................................................................... 23 3.6.4 Key Regulatory Activity - Assess and Decide/Make Recommendations on Applications [within the Manage Adjudication process] ........................................................................................................... 24


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3.6.5 Key Regulatory Activity - Enforcement, compliance and ongoing regulatory oversight of regulated infrastructure, works and activities [within the Life-cycle Oversight process] .......................... 25 3.6.6 Key Regulatory Activity - Regulatory Policy Development [within the Manage Energy Information process]................................................................................................................................. 25 3.6.7 Key Non-Regulatory Activities .................................................................................................. 27 3.6.8 Procedures for Dealing with Matters ........................................................................................ 28

3.7 Performance Management (Board Member Evaluation) ...................................... 30 3.7.1 Introduction ............................................................................................................................... 30 3.7.2 Performance Evaluation of the Chair ....................................................................................... 31 3.7.3 External Assessment ............................................................................................................... 31 3.7.4 Lessons Learned ...................................................................................................................... 32

3.8 Data and Information Management ...................................................................... 32 3.8.1 Introduction ............................................................................................................................... 32 3.8.2 Information Management Principles......................................................................................... 33 3.8.3 Board Member Reporting Inflow Requirements ....................................................................... 33

3.9 People & Culture .................................................................................................. 33 3.9.1 Introduction ............................................................................................................................... 34 3.9.2 People Impact .......................................................................................................................... 35

4 BOARD MEMBER OPERATING MODEL SUSTAINMENT .................................... 36

APPENDICES .................................................................................................. 37

Appendix A: Role Description and Accountabilities of the Chair of the National Energy Board, the CEO and Deputy Head, including source of authority .................................. 37

Appendix B: Risk Exposure Matrix/ Corporate Risk Profile ............................................ 40

5 REVISION LOG .......................................................................................... 41

REVISION HISTORY – DEVELOPMENT OF OPERATING MODEL .............................. 41

List of Figures Figure 1 Board Member Operating Model Dimensions .................................................................... 5 Figure 2 The NEB’s Annual Strategic and Business Planning Process Cycle ................................. 9 Figure 3 The NEB’s Departmental Results Framework ................................................................. 10 Figure 4 Board Member Key Interactions ...................................................................................... 15 Figure 5 Risk Management Process for Board Members .............................................................. 19 Figure 6 Links between Strategy & Culture ................................................................................... 22 Figure 7 Board Consultation Steps for Regulatory Policy Development ........................................ 27 Figure 8 Key Shapers of Culture ................................................................................................... 34 Figure 9 Board Member Operating Model Sustainment Framework .............................................. 36


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Glossary and Use of Terms In this document, it is important to understand the usage of the following terms:

• Board Member(s) or Member(s): means both individual Board Members and the collective of all Board Members, full-time and temporary, and does not include Management or Staff.

• CPT or Corporate Performance Team: The Corporate Performance Team implements the integration of the NEB’s planning, measuring and reporting functions, under the leadership of the Chief Operating Officer (COO) and the Vice President (VP), Performance and Results. They provide advice in the development and implementation of frameworks to support planning, evaluation, and management initiatives within the NEB. They also coordinate and prepare several key organizational reports to Parliament.

• Environmental scan: the process of monitoring internal and external environments to identify early signs of risks that may impact the NEB’s ability to fulfill its mandate, including current and future plans. It is an important component of strategic planning.

• Issues: are not risks, as they are events showing that risk drivers have already resulted in situations impeding the NEB’s ability to attain its objectives. Issues are often forerunners of change, signaling a value shift in society, a technological innovation or a paradigm change. Issues may be less entrenched and may be a temporary reaction to a social phenomenon.

• Legislated Mandate: As established in the National Energy Board Act (NEB Act), Canada Oil and Gas Operations Act (COGO Act), Canada Petroleum Resources Act (CPR Act), Canadian Environmental Assessment Act, 2012 (CEAA 2012) and other Acts pursuant to which the NEB acts.

• Management: means the Directors; Leader, Paralegals and Northern Engagement; Assistant Secretary; Vice Presidents; Associate General Counsels; Executive Vice Presidents; Chief Operating Officer; Secretary and the Chief Executive Officer/Deputy Head or anyone that manages people and resources. This group does not include Technical Leaders, Professional Leaders and Group Leaders.

• NEB or National Energy Board: refers to the National Energy Board as a federal agency or department.

• Risk: the ‘effect of uncertainty on objectives’. Specifically, this refers to the uncertainty about the probability of occurrence and impact of future events that can be caused by ambiguity or a lack of information.

• Risk drivers: the conditions (i.e., observed facts and/or trends) that exist in the environment (internal and external) that introduce risk. These are often seen as trigger points for risks or contextual elements. They allow organizations to make assumptions about the future, and to assess the likelihood of the assumptions being realized and the potential consequence on objectives. Because risk drivers give an indication of the sources of a risk, their identification plays an important role in developing mitigations.

• Risk statement opportunity: If event occurs due to driver, the consequences could result in positive impact.

• Risk statement threat: If event occurs due to driver, the consequences could result in negative impact.

• Staff: is defined as all NEB staff excluding Management unless specifically noted.

• Strategic Plan: is a document that summarizes the NEB’s Legislated Mandate, Strategic Outcome and Strategic Priorities.


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1 Introduction

1.1 Overview of the NEB The National Energy Board is a federal agency with responsibilities mandated by law, regulations and policy. Some of the responsibilities are exercised by Board Members, others are exercised by the Chair, and yet others are exercised by the Chair acting as Chief Executive Officer/Deputy Head (CEO/DH), Management or Staff.

1.1.1 Purpose of the NEB The NEB is a federal regulatory tribunal that regulates, among other things, the construction, operation and abandonment of pipelines that cross provincial or international borders, international power lines and designated interprovincial power lines, imports of natural gas and exports of crude oil, natural gas liquids, natural gas, refined petroleum products, and electricity, and oil and gas exploration and production activities in certain areas. The NEB is also charged with providing timely, accurate and objective information and advice on energy matters.

The Strategic Outcome1 states: “The regulation of pipelines, power lines, energy development and energy trade contributes to the safety of Canadians, the protection of the environment and efficient energy infrastructure and markets, while respecting the rights and interests of those affected by NEB decisions and recommendations.”

The Legislated Mandate and the associated Strategic Outcome frame why we do what we do.

1.1.2 NEB Responsibilities The NEB’s statutory duties are adjudicatory, advisory and regulatory in nature.

1. The primary regulatory responsibilities of the NEB under the NEB Act include regulating:

• the construction, operation, and abandonment of pipelines that cross international borders or provincial/territorial boundaries, as well as the associated pipeline tolls and tariffs;

• the construction and operation of international power lines and designated interprovincial power lines; and

• imports of natural gas and exports of crude oil, natural gas liquids (NGL), natural gas, refined petroleum products and electricity.

2. Additionally, in specified areas, the NEB has regulatory responsibilities for oil and gas exploration and production activities in Canada lands not otherwise regulated under joint federal/provincial accords. These regulatory responsibilities are set out in:

• the Canada Oil and Gas Operations Act (COGOA);

• the North West Territories’ Oil and Gas Operations Act (OGOA);

• the Canada Petroleum Resources Act (CPRA);

• the Petroleum Resources Act (PRA);

• multiple laws and regulations for the environmental assessments (EA) that the NEB conducts such as:

1 http://www.neb-one.gc.ca/bts/pblctn/plnprrt/2016-2017/index-eng.html

http://www.neb-one.gc.ca/bts/pblctn/plnprrt/2016-2017/index-eng.html


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o Canadian Environmental Assessment Act, 2012 (CEAA 2012);

o the Mackenzie Valley Resource Management Act; and

o the Inuvialuit Final Agreement or the Nunavut Land Claims Agreement.

3. As part of its overall assessment of all facilities and activities, the NEB conducts environmental assessments under the NEB Act and CEAA 2012.

4. The NEB also monitors aspects of energy supply, demand, production, development and trade that fall within the jurisdiction of the federal government, and prepares advisory reports and other related energy information products.

The NEB is committed to achieving regulatory excellence and fulfilling its regulatory responsibilities efficiently and effectively. The NEB’s activities are founded on its Public Service Values. In addition to its Legislated Mandate, the NEB is required to comply with various laws, policies and rules that bind it as a federal department or agency. The Chair, as the CEO and Deputy Head of the NEB, is accountable for ensuring compliance with these requirements, as further discussed in Section 3.2.3 Roles, Responsibility and Accountability and Appendix A: Role Description and Accountabilities of the Chair of the Board, the CEO and Deputy Head, including source of authority.

1.2 Board Member Operating Model Background

1.2.1 Introduction The Board Member Operating Model (Operating Model) is comprised of this document and an associated RACI matrix (allocates Responsibilities, Accountabilities as well as Consultation and Inform requirements across key activities). It also references existing key NEB processes, practices and governance documentation. The Operating Model will continue to evolve over time to maintain alignment and ensure support of the NEB’s Legislated Mandate, Strategic Outcome and Strategic Priorities and to capture continuous improvements. The review and updating process for the Operating Model occurs in conjunction with the NEB’s strategic planning process. Refer to Section 4.0 Board Member Operating Model Sustainment for more information.

1.2.2 Purpose The Operating Model clarifies the Board Members’ responsibilities, accountabilities, and key processes and articulates expectations for day-to-day activities by providing guidelines and principles on how to operate to accomplish the NEB’s statutory mandate and achieve its Strategic Outcome and Priorities. It supports the Board Members in understanding both their regulatory and non-regulatory functions. It institutes principles that guide the Board Members in all circumstances, irrespective of changes in the NEB’s Legislated Mandate, Strategic Outcome or Strategic Priorities, Management or Staff. It clarifies the meaning of terms and serves as a primary reference document that connects relevant process and governance documents.

1.2.3 Benefits The existence of a documented Operating Model provides several benefits including:


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• Leadership alignment and role & responsibility clarity: Provides clarity on areas where Board Members interact with Management and Staff. The RACI matrix clearly delineates between the Members’ regulatory role and their non-regulatory roles, establishing the responsibilities and decision-making structure under each, and clarifies the importance of the separation of these roles.

• Promotes an internal service-oriented mindset: Allows for the incorporation of Board Members’ strategic, enterprise-first, service-oriented perspective to collectively strengthen the overall effectiveness of the NEB.

• Transparent decision-making: Clarifies the decision-making structure for the various roles and responsibilities, such as regulatory work and Member Committee work. This will support clear, timely, and quality decisions by Board Members.

• Guideline for new Board Members and staff: Plays an important role in helping new Board Members, Management and Staff understand how things get done and the desired outcomes for Board Member activities.

• Learning culture: Supports an adaptive learning culture that can effectively respond to changing situations and challenges.

This Board Member Operating Model should not be confused with the NEB Management System Manual or Enterprise Operating Model. These other Models are intended for broader audiences and contain a broader scope (for example, an Enterprise operating model would be NEB-wide, and would include roles and responsibilities of all Staff and Management, as well as Board Members). Other documents at the NEB clarify the roles and responsibilities of the CEO/DH and Staff, and are referred to where necessary.


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2 Overview of the Board Member Operating Model

2.1 Introduction The Operating Model describes how Board Members’ work gets done and is based on a comprehensive set of interrelated components as illustrated in Figure 1 and described in the accompanying table.

Board Member Operating Model2

Figure 1 Board Member Operating Model Dimensions

Summary description of the Operating Model’s Dimensional Characteristics

Dimension Characteristics

Strategy Defines the Board Members’ involvement in setting the NEB’s Strategic Outcome and Priorities and the related process. It describes the need for high-level, strategic performance Indicators.

Board Member Structure & Governance

Describes the Board Member structure, governance and accountabilities enabling Board Members to execute on their various functions. It also defines the decision-making and authority that connects to the responsibilities associated with each role.

2 The Operating Model’s concepts of Protect and Optimize are intended to reflect the NEB’s desire to Protect and manage its existing strengths at the core of its operations while at the same focusing on the Optimization of its capabilities to address the changing context in which it is operating.

1

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Dimension Characteristics

Risk Management & Controls

Describes the process for Board Member engagement in identification of the NEB’s risk and compliance issues. This process supports the NEB’s ability to identify and mitigate risks.

Board Member Engagement

Describes how Board Members will engage with Canadians on lifecycle regulation matters and build trust to help enhance the credibility of the NEB.

Board Member Internal Interaction

Establishes key principles and describes key interactions between Board Members, Management and Staff.

Board Member Process Management

Identifies the key processes that impact Board Members.

Performance Management (Board Member Evaluation)

Establishes how the Board Members may self-evaluate to drive continuous improvement and foster a learning and an internal service-oriented mindset.

Information Management & Information Technology

Describes the essential information management and technology requirements that Board Members need to understand in order to fulfil their mandate.

People & Culture

Describes how Board Members help to create the service-oriented culture and leadership style through their behaviour.

Table 1 Summary description of the Operating Model’s Dimensional Characteristics

The dimensions establish guidance in the form of principles for Board Members. The principles are statements that define the fundamental aspects of the desired future state and form the foundation of what the Board Members strive to achieve. 3 Board Member Operating Model Dimensions The following sections detail the Board Member Operating Model’s key dimensions.

3.1 Strategy The NEB’s Strategic Outcome and Priorities set the direction for the NEB, and align the organization towards common goals and objectives.

3.1.1 Introduction The CEO/DH is accountable for ensuring that the NEB has Strategic Outcome and Priorities in place each year.

In developing and setting the Strategic Priorities, the CEO/DH consults with the Board Members with the goal of achieving consensus. If consensus is not achieved, the CEO/DH will set the Priorities. Once set, they are then operationalized by Management and Staff through activities aligned to the Strategic Priorities and within the context of the Departmental Results Framework (DRF) – that is, the Core Responsibilities, Programs, and Activities. Once operationalized, the results of the activities against the Priorities are shared with Board Members through internal quarterly reporting of strategic-level performance Indicators. In addition to this internal reporting, the CEO/DH is accountable for reporting to Parliament, through the Minister of Natural Resources, the NEB’s performance towards achieving its Legislated Mandate, Strategic Outcome, Strategic Priorities and Core Responsibilities as described in the next section.

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3.1.2 Government of Canada Reporting Obligations This section describes the important reporting relationship existing between the NEB and Parliament, and the interaction of this reporting relationship with the Strategic Plan.

The NEB is a cost-recovered agency3 and approximately 95% of its expenditures are recovered from the companies it regulates. The NEB receives the balance in public funds. The NEB accounts to Parliament for annual expenditures through its established Departmental Results Framework (DRF).4 The DRF supports a common government-wide approach to the identification of programs and to the collection, management, and reporting of financial and non-financial information relative to those programs.

Consider the DRF a cascade of how the NEB breaks down our Legislated Mandate and Strategic Outcome into our Core Responsibilities and further into programs. It states the intended results and Outcomes at the Core Responsibility and Program levels so our performance can be measured – for each Outcome, Indicators that will be used to measure performance against that Outcome are reported. Governance for each program is required to be described as part of the Program Inventory. The DRF is discussed further in section 4 of the Management System Manual, Core Responsibilities and Performance Measurement.

As a responsible agency and in accordance with the DRF, we prepare the following reports:

1. Report on Plans and Priorities (RPP): Annually, during the Business Planning Process, the NEB provides Parliament and Canadians with a three-year planning document called the RPP. The RPP is structured based on the DRF and describes our organizational Strategic Priorities, key activities, and resources required over the following year to achieve our Legislated Mandate and Strategic Outcome.

2. Departmental Performance Report (DPR): Following the end of the fiscal year, the NEB provides reports on its performance against its performance Indicators and Outcomes for each of its core responsibilities as well as against the Strategic Priorities laid out in the RPP – this report is called the DPR.

3. Annual Report: In addition to the RPP and the DPR, the NEB is required by its enabling legislation to report on performance in a more narrative context through an Annual Report. This report highlights accomplishments but generally focuses less on measures than does the DPR. It provides primarily an overview of Canada’s energy industry and the regulatory activities that the NEB has undertaken during the previous year.

The RPP and the DPR are key components of the Parliamentary Appropriations process, and are structured to align to the NEB’s DRF. Management is responsible for preparing the RPP and the DPR and the CEO/DH is accountable, through the reporting relationship to the Minister of Natural Resources, for the Results and Outcomes.

All editions of these reports are posted on the NEB’s internal and external websites to ensure visibility and transparency into the NEB’s activities and performance.

3 Under the National Energy Board Cost Recovery Regulations. A legislative amendment to COGOA in the Energy Safety and Security Act, once implemented via GIC regulations, will bring 95% to 100%. 4 This framework is under development by the TB.


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The NEB’s Management System

3.1.3 Strategic Planning Process The NEB develops rolling three-year Strategic Priorities. Every year, the Strategic Priorities are reviewed to determine if they are still relevant. The COO is accountable for establishing the annual strategic and business planning cycle, with the Corporate Performance Team (CPT) responsible for implementing the process in consultation with the Board Member Governance Committee. Refer to the NEB’s website5 for the current fiscal year’s Priorities.

5 https://www.neb-one.gc.ca/bts/pblctn/plnprrt/index-eng.html

https://www.neb-one.gc.ca/bts/pblctn/plnprrt/index-eng.html


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The annual strategic and business planning process is illustrated in Figure 2.

Figure 2 The NEB’s Annual Strategic and Business Planning Process Cycle

3.1.4 Strategic Priority Setting In the NEB’s strategic planning process, Members are consulted by the CEO/DH in the development of the Strategic Priorities. Management is responsible for aligning the NEB’s resources, programs and activities within the context of the DRF.

Strategic Priority Setting Principles: 1. The NEB is guided in all actions by the Strategic Outcomes and Priorities, and the DRF.

2. The NEB’s Strategic Outcome is a long-term focus and is generally not revised annually. The CEO/DH will determine when to revisit the Strategic Outcome.

3. In collaboration with Management, the CEO/DH consults with the Board Members in developing the Strategic Priorities. In their consultation role, the Board Members are supported by the CPT and the Governance Committee.

4. A risk assessment of the external operating environment and the NEB’s internal operational risks is considered when reviewing the Priorities.

5. If the Board Members cannot reach consensus on the Strategic Priorities, the CEO/DH will approve the Strategic Priorities for the NEB.

6. Translation of the Core Responsibilities, Strategic Outcome and Strategic Priorities into programs and activities is the responsibility of Management. Board Members are briefed on the selection of programs by Management in the first quarterly period following the approval of the Priorities, and every quarter thereafter.


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3.1.5 Performance Indicators for Strategic Priorities Performance measurement is the process by which the NEB monitors its alignment of resources, systems, and Staff to meet the Legislated Mandate, Strategic Outcome and Priorities, as well as the Core Responsibilities. All elements of performance measurement ultimately link to the NEB’s Legislated Mandate, Strategic Outcome. Measures may be set at different levels of the organization. The CEO/DH approves the Indicators and targets.

Strategic-Level Performance Measurement Principles: 1. A set of well-defined, strategic-level Indicators are established by Management and

approved by the CEO/DH to monitor and report to Board Members on progress towards the Core Responsibilities and Priorities.

2. Management consults with Board Members when developing the strategic-level Indicators.

3. The link is clear between performance Indicators, the associated program, activity, outcome and the relevant Priority.

4. Every Indicator has a defined outcome and target. Targets represent the successful realization of an element of a Core Responsibility, Strategic Priority, program or activity.

5. Monitoring measures and reporting to the Board Members on the NEB’s performance is the responsibility of Management, and the reporting is undertaken on a quarterly basis.

Departmental Results Framework The DRF is introduced in section 3.1.2. Based on the requirements of the TBS’s framework, the NEB’s structure to translate its Legislated Mandate and Strategic Outcome into Core Responsibilities and Programs is illustrated in Figure 3.

Figure 3 The NEB’s Departmental Results Framework


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3.1.6 Quarterly Review and Reporting of Performance Indicators Board Members are provided with an overview of key elements of the NEB’s operations relating to the achievement of the Core Responsibilities, Strategic Outcome and Priorities, programs and activities. The quarterly report will include the results of the performance Indicators against targets. The Indicators are supported by an analysis of the successes and failures to assist Board Members and Management in considering the root cause of performance variances. At the conclusion of each quarterly reporting and discussion, Board Members may make recommendations to Management on potential opportunities for corrective action.

3.2 Board Member Structure & Governance Effective Board Member governance and an enabling structure set the foundation for the achievement of the NEB’s Legislated Mandate, Strategic Outcome, Core Responsibilities and Strategic Priorities.

3.2.1 Introduction The Structure and Governance relating to Board Members provides the framework for roles, responsibilities, relationships and accountability. This section is intended to complement the NEB’s existing Governance Manual. Up to nine full-time Members and any number of Temporary Members may be appointed by the Governor in Council (GIC) to the NEB to perform such duties as assigned by the Chair and as permitted by the terms of the GIC appointment. Full-time Members serve during good behaviour and may only be removed by the GIC on address of the Senate and House of Commons. Temporary Members are typically appointed to add capacity and specific expertise to the Board, on an “as required” basis. For further discussion of the roles of Members, as well as a description of the Chair and Vice-Chair positions, refer to the Governance Manual. Additional information relating to governance is found in the Code of Conduct for Members and Temporary Members.

3.2.2 Governance Governance defines the leadership, structures, roles, responsibilities, competencies, and processes that support the NEB and Board Members. The approach to governance reflects the NEB’s context, including relationships with Canadians and the broader regulatory system in which the NEB operates, and may change over time to respond to needs and a changing model.

The NEB’s Governance Manual stipulates five categories of principles of excellent governance as Culture, Vision and Values, Roles and Relationships, Decision-making, Risk Management, and Accountability. In addition to these five categories, Board Members adopt the following Governance Principles.

Additional Governance Principles: 1. Separation of power and responsibilities: The Chair is diligent in communicating

when he/she is acting as a Board Member, the Chair or as CEO/DH. Board Members are equally diligent in recognizing when they are acting in a regulatory role and when they are acting in a non-regulatory role.


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2. Independence: Roles and responsibilities that Members play are clearly delineated, and Members act with an awareness of the need to protect the degree of independence required for their regulatory decision-making role.

3. Communication and decision-making: Board Members are responsible for all regulatory decisions in which they participate. Board Members are expected to respect, internally and externally, the regulatory decisions of other Board Members and the actions of the NEB as an organization.

When Members are sitting on advisory Committees, they make recommendations, not decisions. Any decisions made as a result of the recommendations from a Committee are made by the CEO/DH.

4. Financial prudence: Members will discharge their duties with due care to efficiency and appropriate cost control.

3.2.3 Roles, Responsibility and Accountability

The NEB

The NEB reports to Parliament through the Minister of Natural Resources. The NEB provides its Annual Report to the Minister of Natural Resources, who tables the report in Parliament.

Board Members In carrying out their regulatory decision-making role, Board Members act at arm’s length and, to a great extent, independently from the federal Government. The Board Members have the authority and a duty to make the regulatory decisions and recommendations they have been assigned. In their regulatory decision-making function, Board Members are responsible for making the decision, or in some cases, the recommendation to the GIC. The decisions of the Board Members are subject to judicial supervision by the Federal Court of Appeal, and ultimately, the Supreme Court of Canada. Board Members may also be assigned responsibility for functions that fall with the accountability of the CEO/DH. For example, the CEO/DH is responsible for developing and approving the Strategic Priorities, and consults with Board Members in exercising this responsibility. In the exercise of various assigned responsibilities, the CEO/DH retains the ultimate accountability, and therefore retains ultimate authority to make the decision if consensus among Board Members cannot be reached in their consultation role.

Chair of the National Energy Board The Chair has certain responsibilities in addition to having the same responsibilities as Board Members. For example, under the NEB Act, the Chair assigns work to Members, issues directives and takes measures. The exercise of these authorities is also subject to judicial supervision. The Chair has a duty to set the agendas for the Board Business Meetings and chair the meetings. In doing so, the Chair takes responsibility for ensuring that the agenda items are well-timed, thorough and include sufficient and appropriate analysis in order to stimulate a successful and meaningful discussion among the Board Members. During the Board Business Meeting, the Chair facilitates the discussion to ensure all Members are heard and that an optimally collegial, effective and efficient outcome (or consensus where required) is reached.


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For more information, refer to Appendix A: Role Description and Accountabilities of the Chair of the Board, the CEO and Deputy Head, including source of authority.

CEO/Deputy Head (CEO/DH) As stated in the NEB Act, the Chair is the CEO of the NEB. He/she is also the Deputy Head of the NEB and as a result, he/she has certain additional powers, duties and responsibilities assigned or delegated to him/her as CEO and head of a federal agency or department, and for which he/she is held accountable. While the CEO/DH reports to the Minister of Natural Resources, the source of the authority being exercised determines to whom the CEO/DH is accountable. For example, if the authority stems from the financial portions of the Financial Administration Act or under Treasury Board policies and practices, he/she is ultimately held to account for the exercise of that authority by the Treasury Board. The CEO/DH is also accountable for the NEB’s compliance with various laws, policies and practices that apply to the NEB by virtue of it being a federal agency or department. Among the various accountabilities, the CEO/DH holds accountabilities as outlined in Open and Accountable Government 2015.

“The Financial Administration Act provides that deputy ministers and deputy heads of other government entities are designated accounting officers for their organizations. Accounting officers are required to appear before the appropriate parliamentary committee to answer questions regarding a specified range of responsibilities and duties relating to departmental management. These responsibilities include managing departmental resources in accordance with government policies and procedures, maintaining effective systems of internal control and signing the departmental accounts. Deputy Ministers have long had these management responsibilities. Under the law, the responsibilities of accounting officers arise within the framework of ministerial responsibility and accountability to Parliament (i.e. Deputy Ministers are accountable to Ministers, while Ministers are accountable to Parliament). Thus the legislation specifies that accounting officers are accountable before committees—that is, they are required to provide information and explanations to committees, and in so doing to assist Parliament in holding the government to account. However, accounting officers are not accountable to committees. Accountability to Parliament for all matters pertaining to the portfolio, including management, rests with the Minister. Where the accounting officer and the Minister are unable to agree on the interpretation or application of a Treasury Board policy, directive or standard, the accounting officer shall seek written guidance from the Secretary of the Treasury Board. Such guidance should be sought through a letter from the accounting officer to the Secretary setting out the issue in a clear and balanced manner. A copy of this letter should be provided to the Minister. If, after the Secretary of the Treasury Board has provided guidance in writing, the matter remains unresolved, the Minister shall seek a decision from the Treasury Board through a submission to the Board. The decision would be shared with the Auditor General as a confidence of the Queen’s Privy Council for Canada. For unresolved questions not related to the interpretation or application of Treasury Board policies, directives or standards, the Deputy Minister (or other deputy head) would have recourse to the Clerk of the Privy Council, who may ultimately seek the consideration of the Prime Minister.”

http://pm.gc.ca/eng/news/2015/11/27/open-and-accountable-government

http://pm.gc.ca/eng/news/2015/11/27/open-and-accountable-government


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In discharging his/her duties, the CEO/DH may consult with Board Members to draw on their significant cumulative knowledge and experience. Since the ultimate accountability rests with the CEO/DH, the role of the Board Members in these functions is more advisory or consultative in nature. Some of the authorities, duties and responsibilities of the CEO/DH may also be assigned or sub-delegated to Management or Staff, but whether assignment or sub-delegation is permitted depends on the particular accountability or responsibility and the legislation setting it out. For further information, see Appendix A: Role Description and Accountabilities of the Chair of the Board, the CEO and Deputy Head, including source of authority.

Accountability Principles: The following accountability principles support Board Member role clarity.

1. Relationship between authority and responsibility: The Chair will clearly identify the authority that accompanies any responsibility given to the Members.

2. Sub-delegation of responsibilities: If the Chair has assigned work associated with the CEO/DH role, a Member assigned that work may, if authorized by the Chair, sub-delegate it within any limits set by the Chair. However, unless permitted by the applicable legislation or regulation, Board Members cannot sub-delegate their regulatory decision-making function to Management, Staff or to other Members.

3. Efficient allocation of responsibility: CEO/DH responsibilities are assigned or delegated to the extent possible and feasible to ensure that the CEO/DH is not responsible for every activity. However, the CEO/DH remains ultimately accountable, and so may supervise or monitor the exercise of those responsibilities.


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Board Member Key Interactions In order to clarify the Board Members’ links to Management and Staff their key interactions are illustrated in Figure 4.

Figure 4 Board Member Key Interactions

Board Member Roles & Responsibilities: This section highlights some of the responsibilities of Board Members and the interfacing roles of Staff that enable the Board Members to perform their responsibilities. Additional details of the Members’ responsibilities can be found in the Governance Manual, Section 3, Board Terms of Reference.

1. Adjudicative hearing panels: As a member of an adjudicative panel, Members make regulatory decisions on matters brought before or initiated by the NEB. Adjudicative panels typically have 3 or more Members. They are assigned a Staff project working group for support.

2. NEB Act s.14 decision: A Member (or Members) authorized by the Chair under Section 14 of the NEB Act will make the regulatory decision. Only certain regulatory matters can be decided by Section 14 Member(s). The Member(s) is assigned a Staff project working group for support.

3. Board Business Meeting regulatory decisions: At regular weekly meetings, Members

make decisions on regulatory matters that have not been assigned to a panel, the Duty panel or to Section 14 member(s).


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4. Duty panels: Members are appointed by the Chair to a three-person duty panel to consider

and make decisions on “Walkaround items” (i.e. routine regulatory matters).

5. NEB Act s.15 decision: A Member (or Members) authorized by the Chair under Section 15 of the NEB Act will prepare a report and, potentially, a recommendation for the Board Members or an assigned panel to consider in making its decision. The Member(s) is assigned a Staff project working group for support.

6. NEB Policy setting: Members approve NEB policies, guidelines, procedures, standard practices or approaches, general orders, safety advisories, information advisories and other NEB policy instruments within the legislative authority of the NEB to regulate certain activities.

7. Regulation development: Members provide strategic direction on regulatory changes or new regulations falling within the NEB’s regulation-making authority. To the extent possible, Members are consulted for input on matters related to the NEB’s mandate but for which the law or regulation-making authority is exercised by other bodies (e.g. GIC or the Minister).

8. The NEB’s Annual Report: Members are responsible for approving the NEB’s Annual Report to Parliament. If Members cannot reach consensus, the Chair will have the final approval.

9. Strategic Planning: The CEO/DH, via the COO and VP Performance and Results, consults with the Board Members and Management annually when he/she develops and approves the NEB’s Strategic Priorities. If the CEO/DH determines it is time to review the Strategic Outcome, Members are also consulted on the Strategic Outcome.

10. Translation of the Strategic Priorities: On the request of the CEO/DH, Members provide strategic advice and support to Management on the approach to translating the Strategic Priorities into programs and activities.

11. Performance Indicators and Monitoring: Management develops the strategic-level performance Indicators for assessing the capabilities of the NEB to achieve the Core Responsibilities, Strategic Outcome and Strategic Priorities in consultation with the Board Members. The CEO/DH approves the Indicators. Members are briefed on the NEB’s performance in relation to same. Members may provide recommendations on corrective actions.

12. The NEB’s Risk Assessment: Members are consulted when Management is identifying the NEB’s regulatory risks. Refer to Section 3.3 NEB Risk Management & Controls.

13. Committee Work: As assigned by the Chair, Members provide strategic advice and input on assigned matters to the Chair, which may be shared with Management and other Members. Refer to Section 3.2.4 Board Member Committee Governance and Structure.

14. Lifecycle Engagement: As assigned by the Chair and consistent with any direction in the assignment, Members undertake lifecycle engagement activities. Refer to Section 3.4 Board Member Engagement.


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3.2.4 Board Member Committee Governance and Structure Board Member Committees are either permanent or temporary and consist of Board Members and ex officio members, collectively known as Committee Members. All Committee Members and the Committee Chair are assigned by the NEB Chair. Each Committee is responsible for a set of deliverables as defined in its specific Committee Terms of Reference. Committees are not decision-making bodies. They report to and provide advice and recommendations to the Chair, who may then share with the Board Members and Management. The primary purpose of Committees is to provide views, feedback, recommendations and advice to the Chair regarding issues and risks. This information may be shared with all Board Members at the discretion of the Chair. Committee work often will involve testing the NEB practices and process and challenging results. The secondary purpose of Committees is to, on Staff’s request, provide guidance during the development of items unrelated to a regulatory decision (i.e. do not relate to decisions on applications, compliance and enforcement matters). The key benefit is that a small group of Board Members can assess in more detail and provide feedback to Staff before those issues are presented to all Board Members. The general guidelines below are applicable to all Committees.

1. Committee Manager: an appointed Committee Manager, who is an ex officio member of the Committee and will represent Management.

2. Mandates: Committee mandates will align to the NEB’s Core Responsibilities, Strategic Outcome and Priorities and not overlap with the mandates of other Committees. Committees provide strategic-level advice and recommendations.

3. Ex officio members: The CEO/DH is an ex officio member of every Committee. The Committees may have other ex officio members from Management or Staff. Ex officio members do not have voting rights.

4. Meetings & Quorum: A majority of Committee Members constitutes a quorum, provided that one of the Committee Members making up the quorum is the Chair of the Committee. The ex officio members do not count towards a quorum. Committee meetings are held on a monthly basis and will provide reports and recommendations to the Chair, who may then share with the Board Members on a quarterly basis.

5. Workplans: Workplans are developed by the Committee members for a 12-month period, typically during the strategic planning process to ensure alignment of resources. The CEO/DH is ultimately accountable for approving the workplans, but consults with all Board Members to do so. If Members cannot agree on the workplans in their consultative role, the CEO/DH will make the final approval. Workplans are shared with Staff ensuring the NEB is transparent about the work of the Committees. Activities from workplans are assigned or delegated to Staff by the Committee Manager.


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Interaction with Staff Committees provide strategic level advice and recommendations, but do not directly marshal Staff resources or financial resources. Each Committee is assigned a Committee Manager to marshal resources to execute the approved Committee workplan. Administrative support is provided by the Secretary’s office. The Committee Manager role is one of the ex officio Committee members (e.g. Management or Staff), and is the point of contact for Committee work. Where conflicts arise between Staff responsibilities and Committee work, the Committee Manager will seek advice from the CEO/DH, who will determine whether additional resources are needed. The CPT is responsible for tracking the implementation of the Committees’ approved workplans as part of CPT’s NEB-wide tracking. For the details of specific Committees, refer to the individual Board Committee Terms of Reference.

3.3 Risk Management & Controls Board Member engagement and identification of the NEB’s risks is critical in supporting the NEB’s ability to identify, manage and mitigate risks.

3.3.1 Introduction Risk management is interwoven throughout the NEB’s activities and is a fundamental component that informs the strategic planning process. Staff administers the NEB’s Integrated Business Planning Process, which supports the strategic planning process, informed decision-making and improved results. Risk management is a critical component of the Integrated Business Planning Process and an essential component of good governance. The timeline associated with integrated risk management is closely aligned with the timeline for the strategic planning process. Refer to Section 3.1.2 Government of Canada Reporting Obligations for the detailed strategic planning process timeline.

3.3.2 NEB Risk Management Risk management is a transparent, integrated, systematic process to achieve objectives, minimize unwanted outcomes and maximize desired outcomes at an organization-wide level. Risk statements are the expression of the probability and consequences of how future events can negatively or positively impact the achievement of objectives. Risks are distinct from existing issues, problems or business conditions, where the likelihood of occurrence is not in dispute. Existing issues, problems or business conditions are not generally re-identified during the risk management process, as the NEB is already dealing with those issues, problems and business conditions. The NEB has an Integrated Risk Management (IRM) Policy and process in place to manage corporate risks, as the management of corporate risks is a requirement imposed on all federal government departments. The NEB IRM Policy is based on the Treasury Board’s (TB) Framework for the Management of Risk. The CEO/DH is accountable for ensuring there is adequate corporate risk management at the NEB. The NEB IRM Policy and process is administered by CPT. For operational/lifecycle risks, the Vice-Presidents manage risks at the business unit level and escalate risks to the Board Members at the discretion of the EVP, Regulatory and the COO through quarterly regulatory reporting.

http://wapps/pdb/ProcessDashboard.aspx?ProcessId=102

http://wapps/pdb/ViewRDIMSDoc.aspx?DocID=594412


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Risk Management Principles: The NEB adopts the risk principles stated in the TB’s Framework for the Management of Risk6 plus the following additional principles:

1. Risks identified are meaningful and at an appropriate level where specific impacts on objectives can be determined and a course of action to respond to them can be established.

2. Risks are consolidated where appropriate to streamline monitoring.

3. Organization-wide risk levels are kept as low as reasonably practicable for the organization and the general public.

4. Trending, root cause and systemic risks are a focus.

5. Controls over risks (mitigation strategies) are reviewed for continued effectiveness at regular intervals.

3.3.3 Board Member Involvement in the Risk Management Process The Board Members’ involvement in the NEB’s Integrated Risk Management process supports decision-making and Priority-setting as well as the achievement of organizational objectives and outcomes. Figure 5 describes that process, and depicts the Board Members’ involvement. The process outlined below is consistent with the NEB’s Process Dashboard process, which is aligned with the TB Framework. The CEO/DH holds Management accountable for stages one through four. Board Members are consulted in stage one and informed at stage four.

Board Members’ Engagement in the NEB’s Integrated Risk Management Process

Figure 5 Risk Management Process for Board Members

Identify/Contextualize Board Member Consultation (Stage 1) An environmental scan and risk identification is completed annually. Risks are assessed in terms of probability and consequences against the Corporate Risk Profile included in Appendix 4.5. Board Members are consulted in stage one; if Board Members cannot reach consensus around the risks to be identified, then the CEO/DH will approve the inclusion of risks.

6 TB Framework for the Management of Risk (Principles): http://www.tbs-sct.gc.ca/pol/doc-eng.aspx?id=19422#appB


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Monitor and Report Board Member Information (Stage 4) The status of risks and mitigation activities identified in the Corporate Risk Profile are reported to the Board Members quarterly. The purpose of this stage is to ensure that risk information and risk responses remain current, valid and relevant. This stage is important as the context that drives risks may change and affect risk exposure. Members are provided with a quarterly strategic reporting package (QSMM reporting) which will provide an overview of the key risks. It will provide measures that demonstrate progress against the compliance and enforcement plan and any deviations due to unforeseen activities. If any Board Member would like more information on a specific risk or opportunity, they may make a request to the Chair. For the QSMM reporting, Management reviews the risk register and determines which risks meet the strategic escalation criterion. If any Board Member would like more information on a specific risk or opportunity, they may make a request to the Chair. Based on the Board Members’ review and feedback, updates to the Risk Registry and Corporate Risk Profile may be made by Staff.

3.4 Board Member Engagement The NEB proactively reaches out to Canadians to empathetically listen to their concerns and act, as appropriate, and is transparent in all of its engagement activities. This section discusses the Board Members’ role in this type of engagement which is outside of the engagement that occurs as part of a hearing or regulatory decision-making process.

3.4.1 Introduction Reaching out to Canadians to build positive relationships is an important priority, and goes beyond the outreach in the NEB’s hearing processes. It means broad and bold engagement across Canada on pipeline safety and environmental issues, incorporating a regional focus. It means more effective communication tailored to the intended audience, and readily accessible to any member of the public. The NEB will demystify itself and its processes, and demonstrate that it is responsive, transparent and working in the Canadian public interest.

3.4.2 Board Member Engagement Approach The NEB is committed to listening to what Canadians have to say. The NEB will engage with Canadians to understand how they are affected by, or concerned about the activities the NEB regulates. This engagement informs how the NEB responds to issues and concerns, achieves desired outcomes, and builds confidence through reliable, consistent regulation.

Reducing possible impacts to the Board’s Independence Lifecycle engagement does not attract the principles of natural justice; however, when and how this engagement is conducted may have an impact, or a perceived impact, on the degree of independence that may be required of the Board when making a regulatory decision or recommendation. As a result, care must be taken to undertake lifecycle engagement activities in a manner that does not compromise the Board’s independence. The Board approved Non-Hearing Lifecycle Engagement Meeting Expectations for Members as one way to operationalize that care. It sets expectations that allow appropriate engagement while protecting the necessary degree of independence for the Board’s regulatory decision-making or recommendation-making function.


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3.4.3 Board Member Engagement Principles Proactive, early engagement is essential for fair and balanced understanding of the Canadian public interest, which is a key component of regulatory excellence. Building ongoing relationships and engaging in active listening to Canadians will enhance mutual trust and understanding.

The following principles guide Members in their engagement activities and support their desire to understand the Canadian public interest:

1. Inclusion and diversity: Engagement activities are conducted with respect for diverse perspectives, voices, ideas, and information.

2. Set expectations: Expectations for the engagement activities are set in advance. The engagement process is clear and open.

3. Openness: An environment is established where participants in engagement activities listen to each other and explore new ideas unconstrained by predetermined outcomes.

4. Preparation: Members are provided with the right tools, techniques, and information to effectively interact with Canadians. Members are consulted in the development of engagement plans for which they are involved.

Canadians need to be engaged in different ways and to different degrees and, as a result, the level and form of engagement is tailored to meet the audience’s needs. Communication products are carefully reviewed for tone and message to ensure they are appropriate for the audience. Participatory events are meaningful and create an opportunity to make a difference, and participants are made aware of that potential in advance. Key messages or the principles of the message are approved by the CEO/DH in advance, and reviewed for consistency against the standard narrative.

Meeting minutes are made available to all participants; a public record of the presentation materials, hand-outs, organizers, participants, outcomes, and of the range of views and ideas expressed are kept. A summary of what was heard and responses to requests and questions are prepared and shared. Board Members will debrief each other on their engagement activities in accordance with the rules set out in the document, Non-Hearing Lifecycle Engagement Meeting Expectations for Members. Engagement activities are evaluated for effectiveness by collecting feedback and measuring success factors.

3.5 Board Member Internal Interaction Effective interactions between Board Members, between Members and Management and Members and Staff, are critical to optimizing how the NEB effectively and efficiently works together as a team to discharge its Legislated Mandate.

3.5.1 Introduction The approach that Board Members take and the attitude they display in their interactions with each other, Management and Staff sets the tone for how the NEB operates. As highly visible leaders within the NEB, Board Members should not underestimate the impact they have through the example they set for Staff and Management.

3.5.2 Behaviours Behaviours can be defined as the approach or attitude that Board Members instill into their work and work interactions. When these behaviours are built on an attitude of mutual support, they


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foster those behaviours throughout the organization and drive quality organizational outcomes, assisting the NEB in achieving its Legislated Mandate. Board Members are highly visible representatives of the NEB in both internal and external interactions. In carrying out their responsibilities, they are expected to be:

• Available and responsive: Available to meet the requirements of panel and Committee work, easily approachable and respectful of the time of others.

• Dependable and reliable: maintain commitments and word, and fulfill agreed-to actions. Be consistent over time in attitude and approach.

• Credible: Leverage the entire knowledge capabilities of the NEB and display sound judgement in interactions.

• Authentic: Be personable and respectful in all interactions, but unwavering in honesty.

• Good listeners: Be both willing and prepared to listen to and respect the views of others, including Management and Staff, Canadians and other Board Members.

• Flexible: Be flexible to meet the evolving needs of Management and Staff, other Board Members and Canadians.

Behaviours: The Link Between Strategy and Culture To successfully achieve its mandate, the NEB must realize efficiencies while delivering high quality regulation. This means being able to transform the NEB’s Strategy (i.e. the Legislated Mandate, Strategic Outcome, and Priorities) into the Culture of the NEB. Figure 6 illustrates how behaviours are critical for leadership to enable that translation.

Figure 6 Links between Strategy & Culture

The four elements serve to guide the behaviours of Board Members in all of their internal and external interactions and link strategy to culture through the behaviours of the NEB’s leaders.

• Strategy: Strategy defines the direction of the NEB, sets the priorities and drives decision-making.

• Leadership: Board Members provide visible leadership through application of the values to their interactions and supporting of the priorities of the NEB.

• Behaviour: Application of a mutually supportive and respectful attitude and approach in the execution of Board Member work and interactions.

• Culture: Culture is established through Board Members’ commitment and an unwillingness to tolerate behaviours that are not aligned to the NEB’s Strategy and Public Service Values. Culture is further explored in Section 3.9 People & Culture.

3.6 Board Member Process Management Processes describe how activities are undertaken. This section explains certain processes relating to Board Member activities and responsibilities.


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3.6.1 Introduction Board Members rely on numerous internal processes to complete their work and to support the realization of the NEB’s mandate. However, Board Members do not directly own internal processes. Internal process ownership lies with the Secretary or with Staff. For example, the Process Manager is accountable for overseeing organizational alignment of all processes against the Core Responsibilities. The VP, Performance and Results is the NEB’s Process Manager. Process Owners are responsible for monitoring and acting on the quality of process delivery. Process Owners are responsible for the ongoing development and maintenance of their processes under the guidance of the Process Manager. See the Management System Manual, section 5.8 for additional process management roles and responsibilities. The NEB’s processes are maintained on the Process Dashboard on the iWeb.

3.6.2 From the DRF to the Four Core Operating Processes Our Process Framework illustrates how the four Core Operating Processes, flowing from our Core Responsibilities (section 4) are enabled by the Management and Support Processes. The Process Framework with its three process categories is illustrated in the table below.

The Core Operating Processes in the Process Framework are discussed below. For more information on Processes, see the Management System Manual, Section 5.

3.6.3 Core Operating Processes There are four Core Operating Processes directly related to our Core Responsibilities. They represent how we do our work on a day-to-day basis and apply to work across the entire organization involving staff and functions from different areas.

Table 2 The NEB’s Process Framework


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3.6.3.1 Manage Adjudication The Adjudication process outlines how the NEB makes decisions and recommendations in the Canadian public interest on issues and applications related to pipelines, power lines, energy development, and energy trade. It encompasses work related to applications for:

• Energy infrastructure;

• Energy exports, imports, tolls, and tariffs; and

• Energy exploration and production.

3.6.3.2 Lifecycle Oversight This process details how we hold companies accountable over the full lifecycle of an energy infrastructure project for environmental protection and safety when conducting regulated activities. This process includes work related to verifying, enforcing and reporting on compliance and regulated industry performance. Lifecycle regulation approach means that if a project is approved, we regulate from condition compliance, construction, operation through to abandonment and more importantly, that we apply our regulatory oversight and tools in the most effective way throughout the lifecycle.

3.6.3.3 Manage Engagement The Engagement process facilitates building and maintaining strong and respectful relationships with Canadians. This enhances the NEB’s ability to fulfill its role as a regulator. This process includes managing relationships with external groups, and oversight of key internal communications activities.

3.6.3.4 Manage Energy Information This process describes how the NEB monitors the Canadian energy system, produces energy information, and enhances energy literacy by providing accurate, relevant, and timely energy information. It states how data and information is collected, classified, validated, analyzed, and stored from various internal and external sources. It also outlines how data and information is reported and presented to Canadians.

For information on the Management Processes and the Internal Services Processes, see the Management System Manual, Section 5.

3.6.4 Key Regulatory Activity - Assess and Decide/Make Recommendations on Applications [within the Manage Adjudication process]

Board Members are required to assess and make decisions or recommendations on a variety of applications, such as applications for new infrastructure, for changes to existing infrastructure, for tolls and tariffs, for export or import licences, for frontier works and activities, for significant or commercial discovery declarations. The Chair assigns Board Member(s) to undertake the assessment and to make the decision/recommendation, and may assign the matter to a panel, Section 15 member(s) or, if applicable, Section 14 member(s), full Board or to the duty panel, or some combination. The CEO/DH sets the budget for the assessment process. The assigned Board Member(s), acting within the mandate given by the Chair and within the boundary of the relevant Act and other laws pursuant to which they are acting, make all other process decisions related to the assessment of that application and leading to the decision or


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recommendation. The assessment of applications can occur through a number of methods, from an informal written process to written and oral hearings. The regulatory decisions or recommendations that the Board Members make on specific applications are generally subject to a high degree of independence. However, this degree of independence is not absolute. The degree of independence in any particular case requires an assessment of the intent of Parliament, as discerned from the relevant statute. At the NEB, independence is not absolute, and it does not necessarily apply to the same degree to all regulatory decisions or recommendations (nor does it apply to all of the NEB’s other functions). Legal Services is available to assist the Board Members in determining when and to what degree of independence is engaged in any particular situation, as well as to assist in finding mitigations to lower the potential for negative impacts across functions.

3.6.5 Key Regulatory Activity - Enforcement, compliance and ongoing regulatory oversight of regulated infrastructure, works and activities [within the Life-cycle Oversight process]

The NEB regulates portions of Canada’s energy infrastructure under federal jurisdiction over its complete life-cycle. This includes ensuring condition compliance, requiring changes to existing infrastructure, overseeing construction, abandonment and remediation activities, auditing, investigating, resolving landowner complaints, and undertaking enforcement actions, such as issuing safety orders or administrative penalties for non-compliance. Regulation throughout the life-cycle means that there are robust processes in place to anticipate, prevent, manage, and mitigate any risks associated with the regulated activities within the NEB’s mandate, and measures to assess and enforce compliance when required. There are a number of regulatory tools used throughout the life-cycle – for some of these tools the Board Members play a role (such as approving conditions filings that are “for Board approval”), but many of which are predominately dealt with by Staff (such as overseeing construction activities or dealing with landowner complaints), and may only be escalated in certain cases.

3.6.6 Key Regulatory Activity - Regulatory Policy Development [within the Manage Energy Information process]

Regulatory policy can be created in a number of ways, using a variety of methods. For example:

1. Regulations

a. Board regulations (e.g. Rules of Practice and Procedure);

b. Board regulations that require GIC approval (e.g. Onshore Pipeline Regulations, Administrative Monetary Penalties regulations);

c. Board regulations that require Treasury Board approval (e.g. Cost Recovery Regulations);

d. Ministerial regulations, with approval of GIC (e.g. s. 107 regulations related to information required to be in land acquisition agreements or Substituted Service Regulations); and

e. GIC regulations (e.g. 119.01 and 130 Part VI Regulations) – on recommendation of the Minister of Natural Resources;


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2. Changes to enabling or other relevant legislation or changes to Government of Canada Policies – e.g. NEB Act, CEAA 2012, COGOA, Policy on Government Security;

3. NEB-issued Guidelines or Guidance - e.g. Filing Manual, Electricity Filing Manual, AMPs Process Guide, O&M Guidelines, Memorandum of Guidance;

4. NEB General Orders – e.g. General Order MO-036-2012 for Electricity Reliability Standards;

5. NEB Security or Safety Advisories, Information Advisories – e.g. NEB SA 2007-03 Security Sensitive Documents; Safety Advisory SA 2015-03 - Power System Protection in Pipeline Facilities; National Energy Board Information Advisory - NEB IA 2012-01 - Survival & Helicopter Underwater Escape Training;

6. Broad regulatory initiatives and policies reached after regulatory proceeding/inquiry/consultation – e.g. LMCI Stream 3 decision and direction re collection and setting aside of funds for abandonment (RH-2-2008 Land Matter Consultation Initiative Stream 3); Arctic Offshore Drilling filing requirements; MH-2-95 Stress Corrosion Cracking Inquiry.

Board Members have different roles for each method:

1. Board Regulations (1(a) to (c) above)) - Board Members approve changes to Board regulations as developed by the NEB’s Management and Staff. Early warning, context-setting and scoping discussions take place early to ensure that Board Members have an opportunity to shape and guide their development. Once the Board Members have approved the regulations, additional changes may be required by the Government (e.g. Department of Justice) prior to the regulations being issued, or after they are issued (e.g. the Standing Joint Committee (SJC) on the Scrutiny of Regulations). These changes are not subject to Board approval, but the Board Members are informed of any substantive changes.

2. Other Regulations (1(d) to (e) above) – In certain cases, the NEB may be consulted and may be able to influence recommendations to the GIC. Where the NEB is involved and if possible (due to timing and security considerations), discussions may take place so that Board Members are informed about these possible changes and any additional input they may have can be considered when developing the NEB’s position. The CEO/DH will determine the final NEB position and the extent of Board Member involvement. Board Members are informed on changes to these regulations that impact their roles and responsibilities.

3. Changes to legislation or Government Policies - In some situations, the NEB may be consulted and may be able to influence the legislative or policy changes. Where the NEB is consulted and if possible (due to timing and security considerations), discussions may take place so that Board Members are informed about possible changes and any additional input they may have can be considered when developing the NEB’s position. The CEO/DH will determine the final NEB position and the extent of Board Member involvement. Board Members are informed on those changes to legislation or policy that impact their roles and responsibilities.

4. NEB-issued Guidelines or Guidance – Board Members approve the initial strategic direction of the Guidelines or Guidance, and any substantive changes to the Guidance or Guidelines. Management approves final wording as long as consistent with strategic direction, as well as minor ongoing improvements and non-substantive changes.


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5. NEB General Orders, NEB Security or Safety Advisories, Information Advisories – Board Members or assigned Board Members approve General Orders, Security or Safety Advisories, Information Advisories.

6. Broad regulatory initiatives and policies reached after regulatory proceeding/inquiry/consultation - Board Members approve broad regulatory initiatives and policies, although assigned Board Members or Staff may conduct the initial regulatory proceeding, inquiry or consultation.

Regulatory Policy Development Principles: When Board Members do have a role in the Regulatory Policy development and approval, they will have input on the development of Regulatory Policy as set out in the principles below.

1. The approval process for Regulatory Policy changes or new policy development is not to be treated as a “rubber stamp” approval by the Board Members.

2. Board Members will have an opportunity to guide or shape the development of the Policy.

3. Board Members are provided with a draft version of the Regulatory Policy changes, and may ask for additional considerations to be taken into account in the drafting of the final version.

4. Board Members approve the “final” version of the Regulatory Policy at a Board Meeting, but recognize that the published version may change from this approved version if the Regulatory Policy is one which must go through the Government of Canada regulation-making process. Changes may also be required by the Government after publication of the Regulatory Policy (e.g. SJC changes to regulations).

Figure 7 outlines Board Member interactions at each of the steps in the Regulatory Policy Development process.

Figure 7 Board Consultation Steps for Regulatory Policy Development

3.6.7 Key Non-Regulatory Activities Board Members are involved in a number of other activities, which are further discussed in other sections of this Operating Model. These include:

• Strategic Planning Process: This process identifies, selects, and prioritizes risks and opportunities that the NEB needs to address. Strategic Priorities set key strategic objectives that align with the NEB’s Legislated Mandate, Strategic Outcome and Core Responsibilities. Refer to Section 3.1.3 Strategic Planning Process.


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• Lifecycle Engagement: This process builds and maintains strong relationships with all Canadians. Establishing mutual trust through good relationships increases the NEB’s level of credibility with Canadians. Refer to Section 3.4 Board Member Engagement.

• Board Member Assessment: This process provides a means by which Board Members may self-evaluate and receive feedback on their performance focusing on the display of the NEB leadership values and behaviour. Refer to Section 3.7 Performance Measurement (Board Member Evaluation).

• Advisory: Provide advice, on request from the Minister, about energy matters, sources of energy and the safety and security of pipelines and international power lines to ministers, officers and employees of any government department or ministry, whether federal, provincial or territorial. This responsibility can be and is often delegated to Staff.

3.6.8 Procedures for Dealing with Matters There are various types of matters that come to the Board. Some matters require a regulatory decision, such as decisions on applications or enforcement actions, others are more strategic in nature, such as regulatory policies, or are for information or education, such as briefings or decision notings. The Chair will determine the procedure to be used to consider an item based on a number of factors, including the purpose and outcome being sought, and the type of discussion or decision to be made, the nature of the matter, the expertise required to deal with the matter, the level of discussion required to deal with the matter. He/she will also determine if the matter should be scheduled for a meeting, and if so, which meeting is the most appropriate to consider that matter. Board Members may request that items be added to the Board Business Meeting agenda by sending an email request to the Chair (copying the Vice-Chair, the COO, the EVPs and the Secretary). The Chair will determine if there is sufficient information to bring the item to the Board Members in order to conduct a meaningful and effective discussion. The Chair will inform the Member if more information is required or if there are any additional steps that need to be taken in order for the item to be brought to the Board Members. In addition to assigning a Panel, Section 14 Member(s) or Section 15 Member(s) to deal with a matter, the Chair may also determine that the matter will be dealt with through one of the following:

• Board Business Meeting (BBM) - regularly scheduled meetings held to consider non-urgent Regulatory and Non-Regulatory Decision Items, and Members Item for Discussion of sufficient importance and require serious discussion, involvement, or awareness of all Board Members. All Board Members are invited and expected to attend. A quorum of three Board Members is required to hold a meeting and make a decision. Board Business Meetings are held each week on Thursday mornings. Board Business Meetings are generally scheduled for three hours.

o BBM Regulatory Decision Item – A Regulatory Decision Item deals with a non-routine matter of sufficient importance that requires a regulatory decision. A quorum of three Members is the minimum required to approve an item. Regulatory items of a routine nature continue to be approved by a Duty panel using the Walkaround procedure. A procedure which outlines the criteria for selecting the appropriate method of obtaining a regulatory decision is available at: http://wapps/pdb/ViewRDIMSDoc.aspx?DocID=573022



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o BBM Non-Regulatory Decision Item – A Non-Regulatory Decision Item deals with matters of common concern that require the Board’s endorsement. These items are not currently part of an active regulatory proceeding and may be intended to keep Board Members informed about a matter and allow for feedback and guidance to staff while an initiative is being developed or a report is being completed. Typical wording found in a non-regulatory item indicate that staff is seeking the Members’ [feedback/ assistance with prioritization/ endorsement/ support/ a decision/ approval/ guidance] based on the following analysis and recommendation. Some examples include proposed reports (such as Energy Market Report, NEB Annual Report, Energy Futures Report), guidelines, strategic plans, regulatory policies, operational plans and strategies, which require review, endorsement, or approval by the Board.

o BBM Members Item for Discussion – A Members Item for Discussion includes issues, concerns and topics of interest that require discussion by Staff and Members in order to inform, educate, or exchange ideas and feedback. Some examples include topics on developing and/or current events (i.e., Canada’s climate change policy), on continuous improvement initiatives (i.e., new Hearing Process Ideas, learned lessons from past panels), or general discussion (i.e., organizational response to an audit report).

• Special Board Business Meeting - scheduled on an as needed basis. Held for urgent matters or those requiring extensive discussion of all Board Members. All Board Members are invited and expected to attend as available to do so. Ad hoc, held as required and for as long as required.

• Walkarounds - routine items for decision by the assigned three-member Duty Panel via a Walkaround Item.

• Electronic Regulatory or Non-Regulatory Decision Items - From time to time, due to scheduling and other considerations, Staff may circulate a Regulatory Decision Item via email in lieu of holding a meeting. Items for the Board Members’ information that are not expected to require extensive discussion may be circulated for email approval rather than by a meeting.

• Electronic Members Item - From time to time, due to scheduling and other considerations, Staff may circulate items to inform or educate Members in lieu of holding a meeting. All Board Members are sent the item, comments may be provided to Staff but are not required.

• Entre-nous Meetings or Strategic Member Discussions – These meetings are strictly non-regulatory (i.e. not project-related) in nature discussions that focus on strategic elements of the NEB’s mandate. They generally occur at the end of regular Board Business Meetings or at any time one is called by the Chair as required. An Entre-nous Meeting has restricted attendance, and is typically only Board Members and others by invitation only. A Strategic Member Discussion typically has broader attendance (i.e. Management and Staff who have a need to know).

• Quarterly Strategic Member Meetings (QSMM) – to review the strategic performance of the NEB and to engage in a broad discussion of strategic topics that are facing the NEB both internally and externally to the organization. All Board Members are invited and expected to attend. Meetings are held once every quarter, generally in June, September, December and March. QSMMs are typically two or three days in length as required.


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In general, matters that come before Board Members for a regulatory decision, if not assigned to a Panel, Section 14 Member or Section 15 Member, would be by way of a Board Business Meeting Regulatory Decision Item, Special Board Business Meeting, Electronic Regulatory Decision Item or through a Walkaround Item. Matters that relate to broad regulatory policy, internal NEB operations or the future direction the NEB would be by way of a Board Business Meeting Non-Regulatory Decision Item, Electronic Non-Regulatory Decision Item, Strategic Member Discussion, or Quarterly Strategic Member Meeting.

Further Resources - Related Internal Links: For more detail on Board Member Regulatory Processes, consult the Internal NEB Process Dashboard > Board Members and Legal Services Processes > Regulatory Decisions Process

3.7 Performance Management (Board Member Evaluation) Performance management is a cornerstone to the overall success of the NEB and the realization of its Legislated Mandate, Strategic Outcome and Strategic Priorities.

3.7.1 Introduction Performance management in the Operating Model is focused on the evaluation process for Board Members and lesson learned processes. Board Member Self-Evaluation In a healthy workplace, there is room for robust, evidence-based advice from Staff as well as for respectful dialogue and challenge between Staff and Board Members, which can lead to better outcomes for the NEB and, ultimately, for Canadians. The NEB’s five leadership behaviours are key to the self-evaluation process, they are applied to all regulatory and non-regulatory activities that Board Members may be involved in. These behaviours are:

1. Model the Way - Titles are granted, but it’s your behaviour that earns you respect.

2. Inspire a Shared Vision - You can’t command commitment; you have to inspire it. You have to enlist others in a common vision by appealing to shared aspirations.

3. Challenge the Process - Challenge is the crucible for greatness. Every single personal-best leadership case involved a change from the status quo.

4. Enable Others to Ask - Leaders foster collaboration by building trust and facilitating relationships. This sense of teamwork extends far beyond a few direct reports or close confidants. You have to engage all who must make the project work.

5. Encourage the Heart - Recognize contributions by showing appreciation for individual excellence.7

The Board Member self-evaluation is intended to

• make the values of the organization explicit;

• focus primarily on Board Member display of leadership values and behaviours, but may not be limited specifically to these areas;

7 Based on the Five Leadership Values from Kouzes and Posner, “The Leadership Challenge”, 5th ed. Jossey-Bass, 2012, pp.16-23




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• provide a voluntary mechanism for individual Board Members to receive feedback on their performance from the Chair; and

• ensure, through a “check-in” with the Chair, that each Board Member is living the leadership behaviours and values of the NEB.

What this is not This is not a tool to measure or evaluate individual Board Members’ regulatory decisions or recommendations. Why does this matter? Board Members are in a position of authority as leaders of the NEB and as such, their behaviour has a significant impact on the behaviours of the NEB’s Staff. It is for this reason that Board Members’ behaviour should reflect these leadership behaviours. Any dissonance between the leadership behaviours and the actual behaviour of its leaders can make it much more difficult to achieve the goals of the NEB. The Board Member Governance Committee is the steward of the self-assessment tool, which is approved by the Board Members.

3.7.2 Performance Evaluation of the Chair The NEB Chair may be evaluated through a 360-degree evaluation tool enabling the gathering of feedback from Management, Board Members and the Minister of Natural Resources. The Chair may also gather informal feedback from all parties mentioned above through frequent and regular discussions to enable the Chair to be highly responsive to the needs of the NEB.

3.7.3 External Assessment External evaluation is only one means of measuring the performance of the NEB, including its performance of its Core Responsibility of Engagement. The approach for external assessment needs to be carefully considered to ensure that it is measuring the right performance targets. All public surveys need to be made public. Given the nature of being a regulator, it can be argued that the NEB will never be able to provide decisions with which all Canadians are satisfied. As such the concept of measuring satisfaction on specific decisions and outcomes is of only limited benefit to the NEB. There is more value in gathering feedback around the NEB’s adherence to its stated hearing process or around its effectiveness in meeting its objectives. Potential areas to gather external feedback may include, but are not limited to

• transparency;

• responsiveness;

• clarity of expectations;

• predictability;

• flexibility; and

• capability / competency.


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External Assessment Principles have been developed to guide this process. These principles are to be followed by the NEB and Board Members in any external assessment activities conducted.

External Assessment Principles: 1. External assessment is not intended to capture opinions or views on the NEB

Legislated Mandate or satisfaction with the NEB decisions. 2. Feedback from external sources may be used as an input into the annual strategic

planning process documented in Section 3.1.3 Strategic Planning Process. 3. The collection of feedback from external sources will not be limited to surveys. The use

of focus groups, interviews or other formats deemed acceptable are encouraged as long as such format allows for adequate and diverse perspectives.

4. All external feedback collection methods must have an appropriate rationale for the need and the use of the information collected approved by COO.

3.7.4 Lessons Learned A key component of any learning organization striving for continuous improvement is the collection, archiving and dissemination of lessons learned. The NEB has a process by which Staff and Board Members conduct a review and learn of each hearing to collect the key lessons from that process. The principles of lessons learned within the Operating Model provide Board Members with guidelines upon which they will participate in enhanced review and learn processes to collect key learnings from other activities, as well as from hearings. Most importantly, Board Members will lead by example in the dissemination and pre-activity review of prior lessons learned. Where possible, Board Members are encouraged to discuss with Staff the lessons derived from previous PWG to gain a broader context of the situation rather than relying on archived information.

Lessons Learned Principles: 1. Lessons learned exercise is completed soon after the project ends (or activity occurs)

to get the most effective input from Board Members and Staff. 2. Capture the key components of successes that can be repeated. 3. Capture the key components of unintended consequences that can be avoided in the

future and the associated successful behaviour or action that would avoid that consequence in the future.

4. Focus on behaviours or tactics that were successful or problematic, rather than people. 5. Guard against a bias towards negative or positive comments and have a mechanism to

accept anonymous input. 6. The lessons learned are stored in an easy to access environment available to the

entire NEB and incorporated into the planning process of related activities.

3.8 Data and Information Management Data and information are valuable assets to the NEB, especially in support of evidence-based decision-making, performance management, and continuous improvement.

3.8.1 Introduction Data and Information are critical to the NEB, which is a data and information-based organization. Board Members receive or seek information in order to fulfil their responsibilities. The changing environment has increased the complexity of data and information requirements. Not only does the NEB require access to the Government of Canada mandated systems, but the NEB also may require new systems to support performance management and reporting.


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3.8.2 Information Management Principles The Operating Model defines the required data and information framework to ensure that Board Members are able to access the quality and quantity of data and information that they need. Within this framework, Management and Staff define, maintain, and update standards and ensure quality and security. Management and Staff are accountable for and to actively manage information systems. They further implement all of the processes, applications, and infrastructure, including IT security, to meet user-defined requirements given system restraints. The following principles will guide interactions on Data and Information Management requirements:

1. Board Member concerns: Board Members’ information management and technology concerns are communicated to the VP, People and Knowledge with specific examples or support to outline the concern.

2. Data quality: Board Members support the NEB requirement to ensure data and information is accurate and current with data entered into a system one time, closest to the source to ensure consistent, quality data management.

3. Data security: Board Members comply with the NEB and Government of Canada’s requirements for data and information security at all times, following all security protocols regardless of working location.

4. User-defined requirements: Board Members are consulted on their requirements prior to any system implementation that may impact them.

5. Ease of use: Management ensures its applications are easy to use and support collaborative problem-solving, systems-thinking, productivity, communications, and decision-making.

3.8.3 Board Member Reporting Inflow Requirements Quarterly Strategic Members Meeting report (QSMM report)

• Management Report: Interim results of actual performance against Strategic Outcome and Priorities for defined and approved performance Indicators. Includes Regulatory Report. See section 3.1.6 Quarterly Review and Reporting of Performance Measures for Strategic Priorities.

• Committee Report: Updates from each Committee on progress against workplans, challenges, and issues.

• Key Board Member lessons learned captured in the quarter.

Annually

• Approved performance Indicators to track progress against Strategic Outcome, Priorities and Core Responsibilities.

• Final approved Strategic Outcome and Priorities.

3.9 People & Culture Organizations with well-developed cultures have been proven to help organizations meet their strategic objectives. Once the NEB’s strategy has been set, leadership translates it into culture.


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3.9.1 Introduction The NEB’s culture is not defined by its purpose or vision, but by the behaviours and principles practiced every day, from Board Members to Management to Staff. Board Members have a critical role in shaping the NEB’s culture, and furthermore, evolving it to keep pace with the changing external environment. Board Members are a highly visible part of the NEB both internally and externally. Board Members are expected to understand the impact their behaviour has on the NEB culture and to display the highest standards of behaviour in all of their interactions. The NEB’s culture needs to support achieving the vision and strategy of the organization. Culture is the common behaviours or norms demonstrated by a group of people interacting or working together. It encompasses the values that are seen in an organization and often leads to traditional methods of operating that evolve organically over time, often answering the question “why do we do it this way?” Figure 8 illustrates the key shapers or drivers of culture and where these shapers manifest themselves within the organization with the ultimate result of organization performance or new behaviours as they relate to the NEB’s change initiatives.

Key Shapers of Culture

Figure 8 Key Shapers of Culture


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The lowest common denominator in tolerated behaviour often sets the tone for an organization’s culture. Culture evolves over time and is heavily influenced both by leadership and organizational systems. During periods of major organizational change, areas for cultural improvement are often exposed. As an organization operating in a changing context, the NEB has the opportunity for Board Members to showcase the behaviours necessary to foster a culture of respect, integrity, and accountability, which is dedicated to achieving the NEB’s Strategic Outcome.

3.9.2 People Impact The NEB’s culture has a direct impact on its ability to attract and retain top talent necessary to support the Board Members in carrying out its Legislated Mandate, Strategic Outcome and Strategic Priorities. It is through awareness of how the Staff, Management and Board Members treat each other, shared values and openly displayed behaviours that a working environment of respect and performance is created. Board Members’ commitment to support both the NEB’s people and its collective culture allow the NEB to remain an employer of choice and to be recognized for the excellence of its people and the work that it delivers.


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4 Board Member Operating Model Sustainment It is important that the Operating Model is understood and adopted by the Board Members and Management. In cases where there is a conflict between the guidance provided in the Operating Model and the provisions of the NEB Act or other applicable legislation, the legislation shall take precedence.

The Operating Model will continue to evolve as the NEB’s Strategic Outcome, Strategic Priorities or Legislated Mandate evolve. It will need to be regularly updated to reflect the changes. Sustaining this Operating Model is important to achieving significant continuous improvements.

The Secretary is accountable for the stewardship and maintenance of the Operating Model. It will be reviewed annually to ensure that it and all of its linked and related components reflect the NEB’s Legislated Mandate, Strategic Outcome and Strategic Priorities.

The framework in Figure 9 describes the cycle and process for review, assessment, and improvement of the Operating Model.

Operating Model Sustainment Framework

Figure 9 Board Member Operating Model Sustainment Framework

Plan • Identify relevant internal stakeholders to review the Operating Model

• Plan the review and assessment

Review & Assess

• Initiate review and assessment of the Operating Model after the Strategic Priorities are approved

• Identify areas of improvement

Update & Improve

• Create and execute on an improvement plan

• Have internal stakeholders review the updates and improvements


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Appendices

Appendix A: Role Description and Accountabilities of the Chair of the National Energy Board, the CEO and Deputy Head, including source of authority

Chair of the National Energy Board The Chair of the NEB is designated by the GIC from among the Members. As a result, in addition to having all of the same duties and responsibilities as a Board Member, the Chair is accountable for ensuring that the Members fulfill their regulatory mandate set out under the Acts under which they have responsibilities (but not necessarily for how they fulfill the mandate). Essentially, the Chair oversees the regulatory functioning of the NEB. To do so, the Chair is responsible for the creation of systems for the NEB to carry out its regulatory function effectively. The Chair sets the agendas for and leads the internal meetings, apportions work among the Members and, if the NEB sits as a panel, assigns Members to the panel and a Member to preside over it.8 The Chair also ensures timeliness of application assessment, issues directives or takes measures.9 The Chair can authorize the replacement of Members for incapacity, must set time limits for certain applications and can approve the exclusion of certain periods for the purpose of time limits.10 The Chair oversees Member training and performance. The Chair may be consulted in the recruitment of new Members or the renewal of existing Members. He/she also supervises and directs the work of the Staff.

These powers and functions pass to the Vice-Chair or another Member if the Chair and Vice-Chair are absent or unable to act, or if the offices are vacant.11

CEO The Chair is also the Chief Executive Officer of NEB (CEO).12 The CEO of an administrative tribunal is not the same as a CEO of a corporation. One author has noted that “[t]he common description of the position of a CEO of a business has little, if any, application to the management and operation of an administrative agency …”13 Essentially, the CEO of the NEB is responsible for managing the administrative side of the NEB - this includes the Staff, the equipment, supplies, budget and working systems. The CEO has oversight over the long-term strategic direction of the NEB as it relates to being a federal government department and over the operations of the Board as a department. The CEO is responsible for the effective administrative functioning of the organization. For example, the CEO provides direction to Staff on legislative and regulatory initiatives (related to the NEB Act or any other Act that imposes obligations on the Board as a department or a tribunal), which initiatives impact the Board’s operations. The CEO either provides feedback or directs Staff to provide

8 NEB Act, ss. 6, 14, 15 9 NEB Act, s. 6 10 NEB Act, ss. 6, 16, 52, 58, 58.16 11 NEB Act, subs. 6(3) 12 NEB Act, subs. 6(2) 13 Macaulay, Robert W., and James L. H. Sprague. Practice and Procedure Before Administrative Tribunals (loose-leaf), at 4A.1(e) (WestlawNext Canada)


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feedback on other policies of Central Agencies that impact Board operations. This is different than the roles of the Members or the Chair. The CEO develops and implements the Management Priorities, which support the Strategic Priorities. The CEO is the channel to the Minister of Natural Resources, the Department of Natural Resources Canada and the rest of the federal government, as well as to any departments within the greater federal public service, such as Public Service Commission, the Office of the Auditor General, and the Treasury Board Secretariat. The CEO is held accountable for the NEB’s compliance with public service-wide policies and procedures. The CEO is responsible for all non-regulatory NEB reports to government – such as the Departmental Performance Report, the Report on Plans and Priorities, the Annual Report on Official Languages. This is because the CEO is responsible for the performance of the NEB itself and for reporting on that performance to the Central Agencies. Generally, neither the Vice-Chair nor any Acting Chair undertakes these functions when the Chair/CEO is absent. Instead, typically the COO or senior Management is sub-delegated these powers and functions.

Deputy Head By virtue of being the CEO, the Chair is vested with responsibilities of a Deputy Head (under the FAA and other related Acts)14. For example, the Deputy Head is responsible for, among other things, ensuring internal audit capacity, setting up audit committees,15 and for ensuring there are appropriate procedures and records respecting the control of financial commitments charged to the NEB’s appropriations.16 The Deputy Head is also the accounting officer under the Financial Administration Act (FAA).17 The accounting officer is accountable before the committees of the Senate and the House of Commons for the measures taken to organize the resources of the department to deliver the departmental programs in compliance with governmental policies and procedures, the measures to maintain effective systems of internal control, the signing of accounts, the performance of other specific and assigned duties, and can be called upon to account before the committees for same. GIC can also delegate to a Minister of a separate agency or to the separate agency’s Deputy Head, all the powers and functions of the GIC or Treasury Board in relation to human resources management18, and has done so for the NEB. In addition, subject to any terms GIC may direct, the Deputy Head may determine training and developments requirements, provide for awards, establish standards of discipline, and provide for termination or demotion.19 Powers have also been delegated to the Deputy Head by the Public Service Commission under the Public Service Employment Act, such as the power to make appointments to Staff positions, 14 See FAA, para. 11(1)(c). See also Delegation of Financial Signing Authority Matrix Internal (777924) as well as Treasury Board Secretariat (TBS) Directive on Delegation of Financial Authorities for Disbursements. 15 FAA, ss. 16.1, 16.2 16 FAA, subs. 32(2) 17 The “Chairperson” is designated accounting officer for NEB (pursuant to FAA Schedule 5, part III). Open and Accountable Government 2015 generically says deputy heads are accounting officers; however, the NEB is a separate agency, and under the FAA, the deputy head of a separate agency is the CEO, which in the NEB’s case, is the Chairperson. Notwithstanding this discrepancy, the functions set out in Open and Accountable Government 2015 are more aligned with the functions of the CEO/DH than the Chair, and so these are listed in under the CEO/DH function. 18 FAA, subs. 11.2 (1) 19 FAA, subs. 12(2)


http://publiservice.tbs-sct.gc.ca/pol/doc-eng.aspx?id=17060


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determine the terms and conditions of employment for Staff, establish a classification system, and determine the human resource requirements of the NEB. See for example, the Appointment Delegation and Accountability Instrument. Some of the authorities, duties and responsibilities of the CEO/DH may also be assigned or sub-delegated to Management or Staff, but whether assignment or sub-delegation is permitted depends on the particular accountability or responsibility and the legislation setting it out. While these powers cannot be sub-delegated without permission, the Deputy Head may consult with Board Members, Management or Staff prior to exercising his duties, powers and functions.

http://www.psc-cfp.gc.ca/plcy-pltq/frame-cadre/delegation/adai-idrn/index-eng.htm

http://www.psc-cfp.gc.ca/plcy-pltq/frame-cadre/delegation/adai-idrn/index-eng.htm


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Appendix B: Risk Exposure Matrix/ Corporate Risk Profile Risks are rated and mapped in the Risk Matrix below. The NEB has adopted this four-point risk matrix to plot risks based on their probability and consequence ratings.

Prob

abili

ty

4 – High

Very High

3 – Medium

High

2 – Low

Moderate

1 – Improbable Low

Risk Score Prob. * Consequence

1-2 – Low Risk 2.01-6 – Moderate Risk

6.01-9 – High Risk 9.01-16 – Very High

1 Insignificant

2 Low

3 Medium

4 High

Consequence

Exposure Management Action Required

Low Risk 1-2

• Accept and monitor • Manage via routine procedures where possible • Monitor via normal internal reporting mechanisms

Moderate Risk 3-6

• Develop and implement specific risk mitigation and action plan • Allocate actions and budget to minimize risk where existing controls

deemed inadequate • Management to consider additional controls

High Risk 7-9

• Develop and implement specific risk mitigation and action plan • Consider alternate activity unless appropriate controls are implemented • Allocate actions and budget to minimize risk; monitor implementation • Report to SMC regularly on effectiveness of controls

Very High Risk

10-16

• This rating level is not acceptable • Report immediately to the SMC • Consider alternate activity, unless appropriate controls are implemented • Develop specific risk mitigation and action plan for implementation • Allocate actions and budget for implementation within one month • Report to SMC regularly on effectiveness of control


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5 Revision Log Revision

Date Author Revision Details

11 February 2016

First placed on Process Dashboard (for development revision history see page ii)

22 July 2016 J. Saunders Updated to align with the Management System Manual.

Revision History – Development of Operating Model Version Date Editor Description

1.0 December 1, 2015 EY First Draft for circulation to Officers 2.0 December 7, 2015 EY Incorporation of Officers review 3.0 December 10, 2015 EY Incorporation of Chair feedback

4.0 February 5, 2016 EY Incorporation of several iterations of revisions with legal working group

5.0 January 27, 2016 EY Incorporation of Officer and Board Member feedback on final revision

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