In general, boards are in the spotlight with a focus on board effectiveness. As the light shines brighter, weak boards stand out more than ever before. As new board directors join the board, they need to be concerned about meeting performance expectations. Risk and liability are also big issues to which board directors need to give their attention.
Today’s board directors need to be more well-rounded than ever before. They need to understand how governance manifests in the modern world, which is quite different than board directorships of the past. It’s important for anyone considering accepting a position on a board to at least have a partial understanding of all aspects of the organization’s operations. Each board member should bring some expertise of their own, at least a basic understanding of technology and some aspect of diversity.
Dealing with Governance Disruptors
Boards that are wholly committed to good governance will be productive and effective. While that sounds easy enough in theory, it doesn’t account for the many potential governance disruptors that can so easily get in the way. Being aware of the possible disruptors is the key to turning things toward effectiveness.
One of the most common barriers to board effectiveness is the board not being clear on what their individual roles are or what the role of the whole board is. This barrier slows down board decision making and causes conflict in the boardroom. The goal is for each board member to bring value in some way into the boardroom and for the board to combine its assets for the good of the organization.
While board directors should know what the other board members expect of them and be willing to step up and make an impact, board processes can be a hindrance. Issues like poor meeting management, poor communication and unclear policies can lead to indecisiveness. The lack of efficient board processes is a disruptor that prevents boards from being able to act quickly in urgent situations.
Another notable disruptor that can really throw boards off track is when the board isn’t aligned with the organization’s mission and they don’t agree on the strategy for effective leadership. These disruptors are especially problematic when one or more board members have been silent or participated minimally and, while they haven’t voiced their concerns or opinions, they’re expected to support the decisions of the full board. Board members who don’t have a voice, or whose voice gets overshadowed by others, may pull back and become complacent. In boardrooms where members are hesitant to bring up new issues or tackle the hard issues, it’s impossible to prioritize matters for discussion. Agendas become static and the board merely goes through the motions of handling the routine items and calling it a day. At some point, stakeholders are likely to call the lack of progress to the board’s attention and that’s not the best way to get the board moving.
When recruiting board directors and succession planning, nominating committees need to consider how new board directors will mesh with the current board. One bad apple can spoil the whole bunch is a true sentiment for boards. Poor dynamics in the boardroom fracture boards and brings the morale down. Boards with poor dynamics will likely spend far too much time on power struggles and not get to the root of their work. There should be a spirit of openness and acceptance in the boardroom. Board members should walk out of the meeting with assurance that every member will support board decisions, whether they voted for them or not.
Under the best circumstances, the board’s composition will be a positive rather than a disruptor. Boards need the right people with the right skills. Today’s boards also benefit from board directors who bring new perspectives and new skills to the board and who are willing to ask the questions that no one else has asked. Unfortunately, while boards are charged with evaluating themselves, many of them find it difficult, if not impossible, to be objective in their self-evaluations. To complicate things further, they often recruit new members from their own network, making it even more difficult to be objective.
Board Composition: A Help or a Hindrance?
Boardroom dysfunction can take many forms. A strong co-founder who wants things their own way can dominate board meetings and limit discussions. Overbearing board chairs who don’t tolerate dissenting opinions can stifle a board in record time. Complacent board directors can just as easily lead to board dysfunction. Despite who serves as the board chair, effective board directors need to be outspoken enough to present innovative ideas and to bring a fresh perspective into the boardroom.
It’s just as important for the board and the executive director to have good dynamics as it is to have good dynamics in the boardroom. When board directors lack the same view of strategic alignment with the executive director, it creates tension. Some executive directors are so focused on operations and financial reports that they lack the full scope of their responsibilities. Executive directors need to manage all aspects of management — large and small. Executive directors can also be a hindrance when they fail to communicate important happenings under their control. Poor communication will create an uncomfortable divide between management and the board. It’s crucial for the board chair to have a pointed conversation with the executive director about the specific kinds of reports the board would like to see.
As boards move more intentionally toward diversification, gender and other types of diversity should create a tighter bond within the boardroom and not divide board members. The boardroom should contain an overall spirit of collegiality.
It’s a positive when board directors know what their own board development needs are. They should also be able to give constructive feedback to other board directors about their professional development needs. Board assessment tools like BoardEffect’s survey tool will highlight the areas where the board needs additional training.
Board assessments will also call attention to any gaps in skills that the board has. The best new board director recruits will have the ability to deliver solid strategic counsel and direction. They should look for candidates who are willing to go above and beyond their basic board duties.
Board Evaluations Are Strategies for Effective Board Leadership
To be truly effective, the board evaluation process has to be structured in such a way that it offers a true representation of what’s standing in the way of stellar board performance. A good structure will help the board gain shared insight into their composition, processes and relationships. A good evaluation process can remove obstacles to board performance and highlight best practices.
To get the best from board evaluations, boards must have clear objectives defined and a board leader who’s capable of driving the process. It’s essential for all board directors to have buy-in for the expectations. The process should include input from the managers who regularly interface with the board. The process should evaluate individuals and the board across a broad range of measures. Board evaluations aren’t complete without a comprehensive review of the results and an action plan to address the issues that emerge.
When seeking to identify strategies for effective leadership, consider it an approach to your personal report card. The grade gives you a standard for reflecting on where you are in relation to where you need to be.