Leadership at a governance level is often written about and there are more than enough courses and programs out there that purport to certify competent and qualified directors. And yet we still see - and I get up close and personal with - how governance success remains elusive. Significant organizational failures, whether in the public or private sector, are often attributed to a failure in operational leadership, character flaws of the CEO, and a host of other reasons. I suggest, however, that those failures can too often just as easily be traced back to inadequate governance process and even understanding about what governance is or should be.
I'm going to give you my experience on what I see as some of the most common minefields that boards and individual directors should watch out for to reduce the chances of governance, leadership, and organizational setbacks and failure.
One: Governance Philosophy and Framework. Boards need to spend significant time and energy on clarifying what governance means for them and what it entails in terms of their interactions with the CEO and operations. Too often boards and incoming directors operate under the assumption that the skills, abilities, and experiences they have acquired in other environments somehow magically imparts to them the skill to become effective board members. Too often this also means you have as many perspectives on what the board's role is as there are board members. The board needs to engage in a deep and engaged discussion about how they will fulfill their collective responsibilities as a board. The implicit understandings and the potential differences of opinion have to be surfaced, debated, and solidified.
Two: Recruit and Select with Purpose and Intent. One of the challenges that boards increasingly face in the modern era is the challenge of diversity and inclusion. While many boards have developed skills matrices and other processes to fill out their ranks as vacancies arise, there are still unseen biases in place that perpetuate a homogeneity in board composition. Boards must increasingly challenge their own paradigms, challenge their assumptions, and confront their biases as they recruit and select new board members with an eye to the future challenges their organization may face. More of the same might support harmony, but is likely inadequate to support change in a dynamic environment.
Three: Wear the Right Hat. Boards need to pay attention in their recruitment, selection, and orientation efforts to the perspectives and mentality of wanna be board members. Are these new board members animated by a singular issue? Do they have an axe to grind? Are they at risk for conflict-of-interest scenarios? Can they identify potential blind spots or biases? In my experience, these types of conflicts and biases move well beyond direct and personal financial benefit as so many might assume. Individuals might be trying to right some perceived wrong from past experience with the organization (e.g., a family member's bad experience), a desire to change the values and culture of the organization to align with personal values, or even believing they are more qualified to be the CEO so they will "dig deep" into operations to get things right.
Four: Do Your Work. Aspiring to be on a board - or at least to being an effective board member on an effective board - means you have work to do. I still encounter too many board members who view their simple membership on a board or attendance at board meetings as service enough. They believe their presence is contribution enough, or that a trite - and maybe even the odd relevant comment - once a board meeting fulfills their obligations as a board member. This is no more than check-box governance or social club participation. Regardless of the size of organization, board work should be seen and undertaken as a significant responsibility. Stand up or stand aside. Read your agenda materials before the board meeting, participate in board committee meetings as designated, and bring forward your unique perspective to the benefit of the organization.
Five: Evaluate Board Performance. While many board members might be quite prepared and excited to evaluate CEO and organizational performance, they can become quite twitchy when the subject of board evaluation is broached. As a group of peers - and perhaps accomplished professionals in their other lives - they fear the challenge or consequences of evaluating each other and/or being evaluated themselves. But, in my view, they have a responsibility to model a commitment to evaluation, self-improvement, and growth that I expect they have for the rest of the organization. What can help boards carry out this function are a number of things: a) a transparent and authentic discussion of the purpose of such an evaluation; b) an agreed-upon and relevant structure and process for the evaluation; and c) objective, third-party support for supporting the assessment. These elements can take a lot of the fear and mystery out of the evaluation while at the same time making the process and results credible.
Six: Sustaining the Board. One could argue that this minefield could be considered an outcome or offshoot of several of the items noted above. The point to be made here is the board, not the CEO or operations, has to sustain, grow, and cultivate the governance philosophy, framework, and its culture in a very intentional fashion. To me this process takes several forms: a) reviewing and affirming the governance philosophy and framework on a regular (and not less than annual) basis; b) a structured approach to review board policies and procedures; c) engaging in professional and personal growth and development activities; c) onboarding new board members (and not simply handing incoming board members the orientation manual...); and d) being available as mentors to new board members.
Seven: Manage the CEO Partnership. The single most important relationship a board has to manage is the partnership it should have with its operational leader. I like to talk about this through the use of a visual that shows two overlapping circles. In the middle, there are the shades of grey to be actively managed. So I don't view the the roles of board and CEO as being completely and utterly distinct and separate. They have a shared responsibility to protect and advance the organization. And they do have to fulfill this obligation in a trust-based partnership. Too often boards or individual board members gravitate to polar extremes. On one hand they can default to a far too personal a relationship with their operational leader, blindly trusting the CEO and not keeping their eyes on real performance of the organization. On the other hand, other board members see their role as one of forensic auditor in every board meeting or even requiring on-site, random, operational visits to interrogate staff and clients alike about organizational performance. Neither approach is appropriate, nor will it create an environment conducive to operational excellence.
Being on a board or pursuing a board appointment represents a significant commitment and responsibility. The small listing of landmines above is not intended to dissuade anyone from pursuing a board appointment. The work is both critically necessary for organizations large and small, in the private and public sectors, and can be incredibly rewarding and informative. Just appreciate it is a critical role and it requires significant effort to do the role justice.
It's About Governance and It's About Leadership!
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Greg Hadubiak, MHSA, FACHE, CEC, PCC
President & Founder - BreakPoint Solutions
gregh@breakpoint.solutions
www.breakpoint.solutions
780-250-2543