Winning boards are a result of how people work. It has nothing to do with a plethora of board rules and regulations. After serving on several boards, I know from experience that a good Chair can make or break the effectiveness of the board. The role of the Board Chairman is to manage board dynamics to perform its duties as defined in the board charter. This involves giving adequate airtime to all members and allowing practices that encourage mutual respect and informed discussions.
Great boards have effective social interaction systems – forums where board members engage each other and discuss issues beyond the ‘meeting’ time. Great companies that have collapsed had boards where members were committed, attending board meetings, reading board papers in time, and boards were diverse in terms of composition re gender, skills, age mix, and experience. But companies nevertheless collapsed. The issue is why?
I have found four things that must be fostered among board members – open dissent, individual board member accountability, a climate of trust and candor, and above all, timely board evaluations to assess the board and individual board member impact.
Does the board have pressures to conform? Are you going to be another yes man, or woman, on the board? You need a board that is open to fresh thinking and challenges to the popular positions. One of the most frustrating things is being a board member where decisions that are not prudent are considered and passed yet they do not make sense. I have noted that a powerful CEO can bulldoze boards and get their way easily without much ado. The willingness to challenge other positions on the table makes a productive board.
To be continued…