Effective Boards are critical to ensuring effective organizational governance in today’s complex world. While many current governance training and education offerings target individual Director development, our emphasis is on helping Boards close the gap between their current performance and high performance by enhancing the Board’s effectiveness in functioning together as a team and ensuring that the Board’s overall performance is “greater than the sum of its individual parts”. Our work focuses on four key success criteria: clarity of Board purpose and priorities, solidarity around strategic direction, operational excellence; and supportive behaviours and relationships.
- Clarity of Board Purpose and Priorities
Boards have a unique value and they exist to ensure the right strategic direction, that risks are identified and managed, and that they are supporting the right leader. Boards need to confirm their unique role and purpose including what the Board is there to accomplish and what stakeholders are counting on from the Board. They also need to define the set of priority issues that the Board should be focusing on.
A Board’s key areas of responsibility include:
- Setting future organizational direction and priorities
- Monitoring risk and ensuring effective risk management
- Appointing the leader (CEO, President, Executive Director) and evaluating his/her performance.
- Monitoring the implementation of policy & strategy
- Evaluating organizational performance.
- Representing shareholders and other stakeholders
- Fulfilling fiduciary, fiscal and legal requirements.
During this session directors review and evaluate the Boards purpose, its risk identification and management framework and its process for reviewing organizational strategic direction as well as defining priority areas of focus for the next 6 to 12 months.
- Solidarity Around Strategic Direction
Boards are composed of a group of individual Directors with varying degrees of clarity and support of the organization’s direction and strategy. At times, there can be a gap between the board and management on strategic direction. Clarity and solidarity of purpose is critical to strong board leadership and an effective board/management relationship. In consultation with management, and with a firm understanding of stakeholder expectations, the Board is responsible for supporting and ensuring clarity of strategic goals and performance objectives.
- Operational Excellence
During this phase of the work, Board’s will assess their agenda structures and meeting material with the objective of determining adjustments required to ensure that the board operates in a manner consistent with its role and responsibility. This will include clarifying the types of agenda items that will be discussed at Board meetings and the development of a set of operating principles.
- Supportive Behaviours and Relationships
Being an effective Board member requires behavioural considerations that are often different than those typically employed in other roles. Board members need to define how they want work together, how they will interact with one another and what behaviours will contribute to Board performance, building trust and supporting authentic conversations. Effective and high performing Boards establish a climate of openness and trust where there are no repercussions for asking tough questions and where directors feel comfortable and safe being proactive and curious.
Many Boards have evolved from a traditional code of behaviour that was passed down from one generation of directors to the next. This traditional code represented how directors were supposed to behave – be total loyalty to the Chairman, support management at all times, get along well with Board colleagues by minimizing differences, participate constructively but don’t ask too many or too difficult questions that might rock the boat. The results that this traditional code produced are no longer acceptable. The new concept of the job of a Board director incorporates a new more professional code of behaviour that emphasizes a much more active and insightful involvement in providing direction and overseeing the organization. During this phase of the program Board members develop clarity on what matters, a better insight into their relationships with other Board members and define a set of guidelines for how they will govern their interactions.