What "Leadership and Governance" Is Really Assessing
A critical briefing for nursery managers and owners on the Leadership and Governance evaluation area in EYFS 2026 and the Ofsted Early Years Inspection Toolkit 2026.
Written byAbraham
Published
Reading time23 min read
Of the six graded areas in the 2026 early years toolkit, Leadership and Governance is the one that nursery owners tend to describe most confidently and understand least precisely. Ask a manager what it assesses and the answer is usually a list: policies, supervision, training, a development plan, a vision statement. Ask an inspector and the answer, as the toolkit is written, is closer to a question. Do the people who run this setting know, accurately, how good it is, and do they act on what they know in ways that change what children experience?
This briefing takes that question seriously. It sets out what the toolkit says (as published in the June 2026 version I have drawn on), explains the research that makes the area intelligible, and then reads it critically: where it is a fair test, where it is vulnerable to presentation, and where its demands fall unevenly on a small owner-managed nursery compared with a school or a group. A note on terminology: early years inspections in England operate under the Early Years Inspection Toolkit and its operating guide rather than a school-style handbook, and the toolkit's wording uses "leaders", "governors" and, for private and voluntary providers, the "nominated individual". The article follows that wording.
What the toolkit says the area is for
The toolkit frames Leadership and Governance around two things: whether leaders and governors understand and meet the statutory requirements of the EYFS, and whether they are committed to high standards of education and care, with particular attention to children who need additional support. Its key factors include leaders' high expectations as they show up in staff's daily interactions with children, leaders' understanding of their setting's strengths and areas for development and whether their actions improve or sustain standards, the clarity of roles among leaders and governors, parental engagement, attention to staff workload and wellbeing, and decisions made in children's best interests.
The evidence-gathering guidance breaks this into five strands: strategic leadership; governance and accountability; staff wellbeing and workload; professional learning and development; and parental and community engagement. Under governance, the nominated individual is expected to be knowledgeable about their statutory duties and to carry them out effectively, to hold an accurate picture of quality and impact, to manage resources including statutory funding, and to check that leaders remain suitable and receive challenge. Under wellbeing, leaders are expected to make sure workload is manageable and not to create unnecessary burdens, and to protect staff from bullying and discrimination. Under professional learning, they should establish a culture of continual improvement, with training covering behaviour and routines, the curriculum (especially communication, language and mathematics), adaptations for children with additional needs, and practice that supports the care needs of babies, including safe sleeping, weaning and safer eating.
Share this article
Written by
Abraham
Operations Director, Awake Early Years Consultancy
Former Ofsted Early Years Inspector, doctoral researcher and early childhood education and care consultant with over 16 years' experience across practice, inspection and leadership.
The grade descriptors then show what each level is made of. At Expected Standard, the relevant EYFS requirements are met and leaders understand the setting's context and take timely, effective action; the nominated individual provides vision and strategy, manages resources well and offers support and challenge; professional learning is regular and relevant; staff feel valued and workload is manageable. Needs Attention is described in terms of leaders who have a broad awareness of strengths and weaknesses but lack precision or do not identify root causes, improvement that targets the right areas but is too slow, a nominated individual who understands the role but offers weak challenge, and professional learning that is generic or poorly targeted. Strong Standard adds detailed analysis, a culture in which staff give and receive feedback, and professional learning closely matched to priorities and individual needs. Exceptional adds sustained standards, leaders at all levels contributing, a transformational impact on children who face barriers, and no significant unaddressed weaknesses. Urgent Improvement includes unsuitable leaders, failure to ensure safe sleeping, weaning and safer eating, unsustainable workload, and a nominated individual unclear about their duties.
Read as a whole, the descriptors are a ladder of accuracy and speed. Needs Attention is not "no systems"; it is imprecise diagnosis and slow action. That is the first clue to what the area really assesses.
The theory: leadership effects are indirect, so inspection must look at mechanisms
The research on leadership and outcomes has a consistent message that is easy to forget: leaders rarely affect children directly. Hallinger and Heck (1998), reviewing fifteen years of studies of the principal's contribution to school effectiveness, concluded that effects are mostly indirect, running through the organisation's goals, culture and the quality of teaching. Robinson, Lloyd and Rowe (2008), in a meta-analysis, found that the leadership dimension with the largest effect on student outcomes was promoting and participating in teacher learning and development, with substantial effects also from establishing goals and expectations and from ensuring an orderly environment; Leithwood, Harris and Hopkins (2008) and Day, Gu and Sammons (2016) reached compatible conclusions, emphasising that successful leaders work through people, structures and culture rather than through personal heroics.
This matters for inspection because it explains why the toolkit does not grade leadership on what leaders say about themselves. If leadership works through mechanisms (what staff expect of children, how they are developed, how problems are noticed and fixed), then the only credible way to assess it is to look for those mechanisms in the visible work of the setting. That is why the key factors begin with "high expectations, reflected in staff's daily interactions with children". An inspector who sees thin interaction in the toddler room is entitled to ask what leadership has done about it, because the theory says leadership is the cause that is working or failing to work.
Bush and Glover (2014), surveying models of school leadership, noted how many competing definitions exist, from instructional to transformational to distributed. The toolkit does not choose among them. It is, in effect, theory-light and mechanism-heavy: it describes behaviours and conditions without prescribing a style. Managers should read that as an invitation to build their own explicit account of how their leadership produces good practice, and to be able to articulate it.
In early years specifically, the distributed perspective has been especially influential. Spillane, Halverson and Diamond (2004) argued that leadership is best understood as practice stretched across leaders, followers and situations, not as a property of one person. Heikka and Waniganayake (2011) applied this to pedagogical leadership in early childhood settings and showed that distributed leadership can support pedagogy only when roles, responsibilities and expectations are clear. The toolkit's concern for "clarity among leaders and governors about their roles" echoes that finding almost directly, and the Exceptional descriptor's reference to "leaders at all levels" shows where the grade ladder is heading: not a charismatic owner, but a setting whose quality does not depend on one person.
"Knowing your setting": the central test
If one phrase carries the weight of the area, it is "leaders' understanding of their setting's strengths and areas for development". The Needs Attention descriptor is the telling one: broad awareness, but a lack of precision and failure to identify root causes. Many nurseries live there. They know that "communication and language needs work" without being able to say which rooms, which adults, which routines or which children are the problem, nor why.
Argyris (1976) distinguished single-loop learning, which corrects an error within existing assumptions, from double-loop learning, which questions the assumptions themselves. A nursery that responds to weak language outcomes by buying a new phonics resource has learnt in a single loop. A nursery that asks why its adults talk less to babies in the late afternoon, and discovers that staffing patterns, break cover and room layout are producing silence, has begun double-loop learning. "Root causes" in the toolkit's language is double-loop territory.
Root-cause thinking asks why adults talk less to children at certain times of day, rather than buying a new resource. Photo: Amonwat Dumkrut on Unsplash
Here the research on self-evaluation becomes uncomfortable. Kruger and Dunning (1999) showed that those who perform least well are least able to recognise it. Vanhoof and Van Petegem (2007) argued that internal and external evaluation differ in purpose and standard, and that internal evaluation is not a safe proxy for the external kind. Bevan and Hood (2006) showed that organisations held to targets learn to produce the measure rather than the underlying quality. Taken together, these findings mean that "accurate self-knowledge" is hard to achieve and easy to fake, including by well-intentioned leaders who have convinced themselves. An inspector's task is therefore to test the match between leaders' account and what is visible, and the match is the evidence. A manager who says "our weakest area is the baby room's interaction at lunchtime" and whose inspector sees exactly that is demonstrating leadership at Strong Standard, even though the finding is unflattering. A manager whose self-evaluation says everything is good and whose inspector sees something different has revealed the gap that the descriptors penalise.
Hofer, Holzberger and Reiss (2020), in their synthesis of research on school inspection effectiveness, found that inspection tends to work best when it prompts schools to engage with an accurate picture of their own quality and to act on it, and that unintended effects, such as window-dressing, appear when inspection is experienced mainly as a threat. The implication for leaders is clear: the way to meet the "knowing your setting" test is not to build a more elaborate self-evaluation form but to build routines that generate disconfirming information, and to welcome it.
Governance without a board: the nominated individual and the owner
Governance is the part of the area that sits least comfortably with the structure of the day nursery sector. Schools have governing bodies. Many nurseries have an owner, sometimes also the manager, sometimes a remote investor, sometimes a group's head office. The toolkit addresses this through the nominated individual, who should know their statutory duties, hold an accurate view of quality, manage resources including funding, and check leaders' continued suitability and offer challenge.
Agency theory offers a lens that is blunt but useful. Jensen and Meckling (1976) described the problem that arises when those who own an enterprise differ from those who run it: owners cannot perfectly observe managers' actions, and managers' interests may diverge from owners'. In a nursery group, the owner or nominated individual who relies on a monthly dashboard from the manager is in the position of the principal in this model. The dashboard is produced by the agent. The toolkit's expectation that the nominated individual has "an accurate picture of quality and impact" is, in this light, a demand that principals find ways to see the setting that do not pass entirely through the agent's hands. Davis, Schoorman and Donaldson (1997) offered a counterpoint in stewardship theory, arguing that managers are often motivated by professional pride and commitment rather than self-interest, and that over-monitoring can damage this. Both are partly right. Good governance combines trust with verification: occasional unannounced visits, direct conversations with room leaders, parents and children, and sampling of records.
The owner-manager is a particular case. Where the person who owns, manages and is the nominated individual are the same, the "challenge" the toolkit expects has no obvious source. Mannion and Davies (2015) noted in their review of organisational culture in health care that cultures tend to reproduce themselves unless there are routes for external perspectives to enter. A sole owner-manager who cannot name where challenge comes from has a structural weakness that no amount of documentation will remove. The remedies are practical and inexpensive: a critical friend, a peer-manager exchange, a local authority adviser, a trusted parent or a retired head, with written terms that make the role one of challenge, and minutes showing that the challenge was taken up.
The toolkit also expects governance to check leaders' suitability, and the Urgent Improvement descriptor lists unsuitable leaders explicitly. Suitability is not a one-off check at appointment. Munro (2011) argued that systems built to demonstrate compliance can lose sight of the underlying purpose. Applied here, a suitability check that is a certificate on a file is weaker than an ongoing practice of supervision, observation and an open route for concerns about the manager themselves. This connects to the safeguarding judgement, which is separate, but the leadership evidence will often be where inspectors learn whether the culture would allow a concern about a senior person to be raised. Edmondson (1999) and Morrison and Milliken (2000) both showed that silence in organisations is usually a rational response to perceived futility or risk; a nominated individual who does not know whether staff would speak to them about the manager does not have an accurate picture.
Staff wellbeing and workload: from welfare to evidence
The 2026 toolkit gives workload and wellbeing a visible place: leaders should make sure workload is manageable, avoid creating unnecessary burdens, protect staff from bullying and discrimination, and ensure staff feel valued. Urgent Improvement refers to unsustainable staff workload. For many managers this reads as soft; it is not.
The job demands-resources model of Bakker and Demerouti (2007) has been among the most widely tested explanations of how work affects people. It proposes that high demands, such as time pressure and emotional load, drive exhaustion, while resources such as autonomy, support and feedback sustain engagement, and that the balance predicts performance. Early years work combines high emotional labour with tight ratios and low pay, which makes the balance fragile. From the inspection standpoint, the relevance is that workload and wellbeing are not separate from quality. They are one of the mechanisms through which leadership influences practice, in line with the indirect-effects theory above. Exhausted practitioners talk less, observe less, respond more slowly, and leave more often, and Slot, Leseman, Verhagen and Mulder (2015) remind us that it is process quality, the moment-to-moment character of adult-child interaction, that is most closely tied to what children experience.
The critical point for managers is that "unnecessary burdens" is a judgement about value, and inspectors will test it by asking staff. The most common nursery burden is documentation that exists for the audit and not for the child: individual next-step sheets written to satisfy a tracker, duplicated records, evidence photographs taken to fill a gallery. Roberts-Holmes (2015) described how datafication pushes practitioners towards recording for accountability and away from teaching. A leader who can say "we stopped doing X because it did not improve practice, and here is what we do instead" is demonstrating the very discernment the descriptors reward. A leader who adds a new log in response to every incident is, however well meaning, creating burden.
Wellbeing evidence also has to survive a quiet conversation. Staff are unlikely to say they are overworked to a visitor if they fear the consequences, so the only reliable evidence is the pattern: turnover, sickness absence, how breaks are actually taken, whether staff can leave on time, whether they say that someone notices when they are struggling. Leaders who track these patterns, and act on them, can show something concrete.
Professional learning that is targeted, not generic
The toolkit's contrast between "generic or poorly targeted" learning at Needs Attention and learning "closely matched to priorities and individual needs" at Strong Standard is one of the clearest in the area. It is also strongly supported by research. Robinson, Lloyd and Rowe (2008) found that leaders' involvement in promoting and participating in teacher learning had the largest effect size of the dimensions they examined, larger than any structural or administrative activity. The mechanism is not attendance at training; it is the leader's participation in learning alongside staff and the direct link between learning and classroom practice.
Leaders promoting and taking part in staff learning had the largest effect of any leadership dimension in Robinson, Lloyd and Rowe's (2008) meta-analysis. Photo: Brooke Cagle on Unsplash
The 2026 toolkit adds specific content expectations: behaviour and routines, curriculum (particularly communication, language and mathematics), adaptations for children with additional needs, and baby care including safe sleeping, weaning and safer eating. Leaders are expected to model their own learning. The implication is that a training matrix showing everyone has completed a course is evidence of coverage and not of effect. The more demanding evidence is a chain: a weakness identified in observation, a learning activity chosen for that weakness, a change in practice observed afterwards, and a result for children. Sylva and colleagues (2006) found that the pedagogical quality in settings, not mere possession of qualifications or resources, distinguished those producing better outcomes, which is why the chain matters.
For the baby-room requirements, the toolkit's emphasis on implementing and monitoring the new sleep, weaning and safer eating requirements means that training alone will not satisfy. Monitoring means observing practice at the cot, the high chair and the changing mat, and being able to describe what was seen and what was changed.
Monitoring the new safer eating requirements means watching practice at the high chair, not just recording that training took place. Photo: rodolfo allen_ on Unsplash
A critical reading: where the area is vulnerable
A fair assessment of the area has to acknowledge its weaknesses as well as its strengths.
The first is the halo problem. Because leadership works through mechanisms that are visible elsewhere, inspectors may infer leadership quality from the other areas. A setting with a calm, well-taught curriculum may be assumed to have strong leadership; a setting with a weak room may be judged to have weak leadership regardless of whether leaders were already aware of it and acting. Bokhove, Jerrim and Sims (2023) found measurable inconsistency in inspection judgements in England, and inference from adjacent areas is one of the plausible routes by which such inconsistency arises. The practical defence is a record that shows the leaders knew: dated, specific, with actions and review points.
The second is performativity. Perryman (2006) argued that inspection regimes encourage the staging of compliance. A leadership area that rewards "accurate self-knowledge" can be gamed by producing a beautifully accurate-looking self-evaluation. Campbell (1979) predicted this: the more weight an indicator carries, the more pressure there is to corrupt it. The remedy for inspectors is triangulation; the remedy for managers is to keep the self-evaluation useful for their own purposes and not shaped by what they think an inspector wants.
The third is unequal burden. Ehren and colleagues (2013), comparing assumptions about how inspection works across six European countries, observed that inspection effects depend on the capacity of the organisations inspected to interpret and act on findings. A large group with a quality team has more capacity than a sole-owner nursery with ten staff. The toolkit's expectations for governance, challenge and precise self-evaluation are the same for both, and small settings will need to be inventive to meet them without paperwork they cannot sustain.
The fourth is the limits of observability. Workload, culture and challenge are mostly invisible during a short visit. Weick, Sutcliffe and Obstfeld (1999) described high-reliability organisations as preoccupied with failure and sensitive to operations; those qualities are exactly what an inspector cannot directly see in a day. The area therefore depends heavily on how leaders talk and what documents they can show, which favours articulate leaders and may disadvantage a quietly excellent manager who does not narrate their work.
None of these weaknesses is a reason for cynicism. They are reasons for leaders to be deliberate about making their knowledge and their reasoning visible and checkable.
What this means in practice for managers and owners
First, write a one-page account of how your leadership produces good practice. State it as causes and effects: what you expect of adults, how you check, what you do when practice falls short, how learning is chosen, how staff are supported. This is the theory-of-change that the research says matters, and it gives you a coherent answer to the inspector's opening questions.
Second, practise precision. For each of the five other graded areas, write the strongest and weakest aspect, with the room, the adult or the routine concerned, the evidence, the likely root cause and the action with a date. Replace "language needs work" with "adult-child talk in the baby room between 2pm and 4pm is sparse because of break cover and room layout; we have changed X; we will re-observe on Y."
Third, build a route for challenge into governance, whatever your structure. Name the person or people who challenge the nominated individual and manager, record what they challenged, and record what changed. If you are an owner-manager, this is the most important change you can make.
Fourth, verify, not just receive. If you own a nursery that you do not run day to day, see the setting through channels the manager does not control: visits, conversations with staff and parents, a sample of records, a look at turnover and absence.
Fifth, treat workload as evidence. Audit your paperwork for burden using one question: does this improve what a child experiences? Stop what does not. Track turnover, sickness, breaks and leaving times; ask staff anonymously how they feel and how the last problem they raised was handled; and record what you changed.
Sixth, connect learning to observed weakness. Keep the chain: observation, learning chosen, practice changed, outcome. For baby-room practice, observe sleep, weaning and eating directly and record what you saw and what you did. Model learning yourself, and be seen doing it.
Seventh, test suitability and speak-up routes about senior people. Make sure there is a way for staff to raise a concern about the manager or owner that does not pass through them, and that staff know it exists.
Finally, rehearse the conversation. Ask a colleague to question you for twenty minutes as an inspector would: how do you know, what is weakest, what have you done, how would you know it worked. Your answers will show where the knowledge is thin.
Conclusion
Leadership and Governance is best understood not as a catalogue of leadership activities but as an audit of the accuracy and effect of leaders' knowledge. The descriptors reward precision, speed, root-cause thinking, challenge, manageable workloads and learning matched to need, and they penalise generic assurance. The research on leadership, self-evaluation, agency and organisational silence explains why: leaders work through mechanisms, their self-perception is unreliable, owners cannot see their settings without help, and cultures reproduce themselves unless disturbed.
The area is not a perfect test. It can be influenced by halo effects, rewards articulate presentation, and places heavier demands on small settings. But those limitations point in the same direction as the advice: make your knowledge specific, make your reasoning checkable, and invite challenge from people who do not share your investment in the answer. A setting that does so will usually be doing what the area exists to encourage, whatever grade it receives.
References
Argyris, C. (1976) 'Single-loop and double-loop models in research on decision making', Administrative Science Quarterly, 21(3), pp. 363-375.
Bakker, A.B. and Demerouti, E. (2007) 'The job demands-resources model: state of the art', Journal of Managerial Psychology, 22(3), pp. 309-328.
Bevan, G. and Hood, C. (2006) 'What's measured is what matters: targets and gaming in the English public health care system', Public Administration, 84(3), pp. 517-538.
Bokhove, C., Jerrim, J. and Sims, S. (2023) 'How reliable are Ofsted inspections in England? An analysis of inspection reliability using a two-stage measurement approach', School Effectiveness and School Improvement, 34(4), pp. 419-441.
Bush, T. and Glover, D. (2014) 'School leadership models: what do we know?', School Leadership and Management, 34(5), pp. 553-571.
Campbell, D.T. (1979) 'Assessing the impact of planned social change', Evaluation and Program Planning, 2(1), pp. 67-90.
Davis, J.H., Schoorman, F.D. and Donaldson, L. (1997) 'Toward a stewardship theory of management', Academy of Management Review, 22(1), pp. 20-47.
Day, C., Gu, Q. and Sammons, P. (2016) 'The impact of leadership on student outcomes: how successful school leaders use transformational and instructional strategies to make a difference', Educational Administration Quarterly, 52(2), pp. 221-258.
Edmondson, A. (1999) 'Psychological safety and learning behavior in work teams', Administrative Science Quarterly, 44(2), pp. 350-383.
Ehren, M.C.M., Altrichter, H., McNamara, G. and O'Hara, J. (2013) 'Impact of school inspections on improvement of schools: describing assumptions on causal mechanisms in six European countries', Educational Assessment, Evaluation and Accountability, 25(1), pp. 3-43.
Hallinger, P. and Heck, R.H. (1998) 'Exploring the principal's contribution to school effectiveness: 1980-1995', School Effectiveness and School Improvement, 9(2), pp. 157-191.
Heikka, J. and Waniganayake, M. (2011) 'Pedagogical leadership from a distributed perspective within the context of early childhood education', International Journal of Leadership in Education, 14(4), pp. 499-512.
Hofer, S.I., Holzberger, D. and Reiss, K. (2020) 'Evaluating school inspection effectiveness: a systematic research synthesis on 30 years of international research', Studies in Educational Evaluation, 65, 100864.
Jensen, M.C. and Meckling, W.H. (1976) 'Theory of the firm: managerial behavior, agency costs and ownership structure', Journal of Financial Economics, 3(4), pp. 305-360.
Kruger, J. and Dunning, D. (1999) 'Unskilled and unaware of it: how difficulties in recognizing one's own incompetence lead to inflated self-assessments', Journal of Personality and Social Psychology, 77(6), pp. 1121-1134.
Leithwood, K., Harris, A. and Hopkins, D. (2008) 'Seven strong claims about successful school leadership', School Leadership and Management, 28(1), pp. 27-42.
Mannion, R. and Davies, H. (2015) 'Cultural factors in healthcare quality and safety: a review', Journal of Health Services Research and Policy, 20(3), pp. 183-191.
Morrison, E.W. and Milliken, F.J. (2000) 'Organizational silence: a barrier to change and development in a pluralistic world', Academy of Management Review, 25(4), pp. 706-725.
Munro, E. (2011) The Munro Review of Child Protection: Final Report. A Child-Centred System. London: Department for Education.
Perryman, J. (2006) 'Panoptic performativity and school inspection regimes: disciplinary mechanisms and life under special measures', Journal of Education Policy, 21(2), pp. 147-161.
Roberts-Holmes, G. (2015) 'The "datafication" of early years pedagogy: "if the teaching is good, the data should be good and if there's bad teaching, there is bad data"', Journal of Education Policy, 30(3), pp. 302-315.
Robinson, V.M.J., Lloyd, C.A. and Rowe, K.J. (2008) 'The impact of leadership on student outcomes: an analysis of the differential effects of leadership types', Educational Administration Quarterly, 44(5), pp. 635-674.
Slot, P.L., Leseman, P.P.M., Verhagen, J. and Mulder, H. (2015) 'Associations between structural quality and process quality in Dutch early childhood education and care settings', Early Childhood Research Quarterly, 33, pp. 64-76.
Spillane, J.P., Halverson, R. and Diamond, J.B. (2004) 'Towards a theory of leadership practice: a distributed perspective', Journal of Curriculum Studies, 36(1), pp. 3-34.
Sylva, K., Siraj-Blatchford, I., Taggart, B., Sammons, P., Melhuish, E., Elliot, K. and Totsika, V. (2006) 'Capturing quality in early childhood through environmental rating scales', Early Childhood Research Quarterly, 21(1), pp. 76-92.
Vanhoof, J. and Van Petegem, P. (2007) 'Matching internal and external evaluation in an era of accountability and school development: lessons from a Flemish perspective', Studies in Educational Evaluation, 33(2), pp. 101-119.
Weick, K.E., Sutcliffe, K.M. and Obstfeld, D. (1999) 'Organizing for high reliability: processes of collective mindfulness', Research in Organizational Behavior, 21, pp. 81-123.
