Trust and Cultural Governance.

• Author: King, Ian

Introduction

In October 2018, Foreign Affairs and Vice-President Federica Mogherini confirmed that the European Union (EU) is now a 'cultural superpower'. This assertion was not surprising considering the wealth and richness that resides within this sector across the whole of Europe, yet a closer examination of the situation reveals that many EU member states are looking to cut budgets for arts and culture. What makes this situation difficult for politicians is that simply making cuts (at least, arbitrarily) could also be a 'vote-loser' if not managed in a sensitive manner. The politicians are often aware that they need to balance on the one hand, the knowledge that continuing to fund the arts and culture at current levels is not realistic in the medium to long-term, whilst on the other hand, many European states, are now demanding that arts and cultural organisations with public financial support, need to become more financially resilient and look for philanthropic support, sponsorship and/or other resources. Additionally, in recognition of their activities, they expect that there should be no compromise with regards to their artistic integrity, mission and values. This is a difficult balance for the arts and cultural sectors between business resilience and artistic excellence.

In order to introduce the central argument of this paper, let us first provide the context for the discussion for readers perhaps unaware of the background. The first question many countries or regions ask today (we will use 'locations' as an abbreviation in this paper) and their governments (and this can be at multiple levels across these locations, that is, local, regional and national): are the arts and culture sectors demonstrably valuable to a community or are they simply a wasteful drain on public resources? The evidence suggests that the arts and culture for Europe and more widely across the globe are generally positive for societies (see Peacock and Rizzo, 1994; McCarthy, Ondaatje, Zakaras and Brooks, 2004; Crossick and Kaszynska, 2016). As an example of the numerous quotations of economic statistics, revenues of [euro]535.9billion (a figure from 2015) were generated from the creative and cultural industries (CCIs) contributing 4.2% of Europe's Gross domestic product (GDP). A figure like this, places the sector as the region's third-largest employer (after the construction and food and beverage industries). And likewise, this rosy picture is not limited to Europe, for in the US, Australia, Canada, Japan (to name a few) arts and cultural economic activities are often reported to account for similar summary percentages of their respective nation's GDP. Its size, its facility to support young people, and women (often over 50% of a working population) makes the arts and cultural sector politically attractive but also a very sensitive arena. Therefore, not getting a convincing balance for this sector may have severe implications for future development, current attractiveness and future valuation of arts and culture, and its ramifications in terms of political economy can spread well beyond this sector both in that location and beyond.

We do need to recognise, obviously, that some areas of these industrial sectors are commercially viable (for example, commercial art, books, design, some heritage locations, and so on), however, indisputably, there is another dimension, one that is less profitable and more closely allied to heritage or education, (or simply, the protectors of history). Consequently, often in order to protect the range and depth of the arts and culture in any given location, decisions need to be made regarding whether (or not) to offer support, and if so, how? This leads us to the opening question, if different locations decide, or need to decide, whether or not they want to fund certain aspects of the arts and culture--how can they justify this allocation of monies in the face of the usual political routines of prioritisation and justification of expenditure? This inevitably leads to current political and economic dynamics, where providers (grant givers from mostly public-sector governments of different levels and different types of trusts and charities etc.) require the arts and cultural sector both in Europe to provide full accountability and transparency (basic principles of governance) so as to assume a professionally defensible position within the political economy.

In this paper, we want to examine how, and with what mechanisms and circumstances, needs to be developed in order to provide a viable means of response to these challenges. That is, an efficient and effective means to support both providers (see above) and receivers (normally arts and cultural organisations and these can be both large and small) and seemingly to make an accountable and transparent means of control for the best use of public funds. The process most often employed to fulfil this complex task is what we refer to as 'cultural governance'.

Yet, despite this propensity the application of governance principles at present remains relatively crude and inadequate for the complex needs of this sector. In this paper, we will suggest that through extensive empirical evidence it is possible to support the development of a process that leads to a more effective tool. This is not something that can be immediately implemented, but rather something that demands time and experience to appreciate the 'local' issues that this entails (which we will identify below). It is important to appreciate that the development of an effective cultural governance process within any given location is unlikely to conform to a standard template. The individual circumstances of the location, including its political climate, together with the stage of its appreciation of arts and culture, is critical.

Nevertheless, we will argue in this paper, that there is a common pattern of development for the arts and cultural sectors with regards cultural governance. We summarise this in Figure 1. and will discuss the different stages in the pages below. Our examination in the following pages suggests that we are, globally, currently in an important phase in the appreciation and support of arts and culture. Of course, not all places around the world are at the same stage of appreciation. Some places see arts and culture as being critical to the guise and identity of a community, perhaps as a country as a whole, whereas others are still trying to determine what exactly is arts and culture to them! This difference in appreciation, together with an increasing move towards greater control and measurement of resources (in a climate where resources are becoming increasingly scarce), leads us to the current situation where governance in the arts and cultural sector is developing, not all at the same speed, nor always in the same direction. Our examination in this paper attempts to chart the critical issues facing the development of governance in the cultural sector, and we will assert that while there are differences there are also common features that make for a pattern of development. This pattern of development, we suggest, can be presented in two halves. The first half reflects an evolutionary development with a prescriptive application of the principles of governance (including clarity regarding the roles and responsibilities of stakeholders; appropriate check and balances; and perhaps most importantly, transparency and accountability).

We observe that most locations still reside in this first half (identifiable in the Figure), yet there is also evidence to suggest that not all locations are content to remain in this first half. We therefore evolved further to positions (in the second half) that we define (in the Figure) as devolutionary. The distinct difference between the two halves is the change of emphasis--from an emphasis on control and measurement, towards one of 'trust and support'. We suggest that for the arts and cultural sector (and this may be true for other sectors as well--but we will not make this claim here) that if we are looking to develop a healthier ecosystem through governance and trust, then the current disproportionate focus towards measurement has in many locations to be replaced by a more balanced support mechanism and therefore move towards a context in the spirit of the words spoken by EU Foreign Affairs and Vice-President Federica Mogherini:" to be ... financially resilient and additionally, in recognition of their activities; "equally, not compromising with regards their artistic integrity, mission and values".

What we also need to stress at this point is that such a move forward is not appropriate for all locations. Some locations face other factors (political, social, and environmental) that preclude this type of development as being the only way forward. Therefore, we need to emphasise that our examination below will only be relevant for some locations at a certain point in their development.

2: What is cultural Governance?

We should also at this early stage rehearse for those readers unaware of the context of cultural governance its origins. Therefore, what is cultural governance? The term cultural governance unsurprisingly emerges from the corporate sector, where it has been in common usage for several decades (see Lubatkin, Lane, Collin, and Philippe, 2005). Etymologically the term can be traced back to the Latin (gubernare) and Greek (kybernein) words for 'govern' which means steering in the navigational sense (see also Stokke 1997: 28). Thomas Schmidt (2011) makes the claim that it is important to appreciate the sectoral features of governance, and he is clear that each sector demands its own understandings and this is certainly true for arts and culture.

Accordingly, Moon argues that cultural governance can be defined as: '(...) government's direct or indirect involvement in the promotion and administration of programs of cultural...