 Trust is one of those social interactions that is crucial for getting things done with others. Boards are by no means exempt. When directors a faced with making strategically-important decisions, they must rely on their board colleagues, the chief executive and any other advisors who may have been invited to contribute. Then, having made a decision, the board needs to follow through, by ensuring the decision is implemented well. However, the sad reality is that levels of trust both between directors and with external stakeholder groups is often lower than is needed for effective decision-making. The following comments, originally published in 2016 by EpsenFuller (subsequently acquired by ZRG Partners), make the point deftly: Board directors today face a variety of challenges. Whether it is a case of corruption or the increasing threat of cybercriminals, their performance in dealing with these issues is the subject of considerable attention, explained The Huffington Post (Jan. 25, Loeb). Investors, consumers and NGOs alike are looking to boards for accountability in terms of company performance. Yet, a recent study found that public trust in boards of directors is lower than that of CEOs. A mere 44 per cent of survey participants claimed to have trust in a company's board—five per cent less than trust in CEOs. Influential constituencies are demanding that boards perform at exceptional levels while maintaining distinct independence from company executives. In order to remedy the current performance-expectation gap, boards should take a few key steps. For starters, boards should adopt some form of both internal and external assessments. Measurement criteria should span from trust to overall effectiveness at achieving board objectives. In order to ensure optimal independence, term limits should be instated and enforced to help safeguard against excessively friendly relationships between board members and executive leaders. Implementing improvements in a similar vein to the ones mentioned above can help boards work toward a future of increased transparency, which will hopefully translate to a rise in trust among powerful constituencies. That some directors do themselves no favours (through poor behaviour, malfeasance and demonstrations of hubris) is self-evident. But all is not lost. The commentary includes several recommendations to enhance trust levels including scheduling meaningful evaluations, imposing term limits and ensuring independence of thought. Although not explicitly stated, high performing boards also reach agreement on the company's core purpose, the strategy to be pursued to achieve said purpose, and the values that will underpin behaviour standards, decision, and everything the company does and stands for. Perhaps if more boards embraced these recommendations and worked with the company's best interests to the fore, the trust problem that generates so much tension (not to mention column inches) would gradually become a thing of the past. Is this expectation worth striving for, or do you think it is too ambitious?
 The 2018 edition of the Global Peter Drucker Forum was convened in Vienna, Austria this week. This post summarises insights from the second day (click here for insights from Day 1). I didn't take as many notes on the second day, preferring instead to sit, listen and dwell on what was said. (I also missed a couple of sessions, one to finalise my own preparations to speak; another to spend time privately with a two inspirational thinkers.) However, there were, for me, two speakers that really stamped their mark on the day, as follows: Hermann Hauser, director of Amadeus Capital Partners and chair of the European Innovation Council, delivered a strong message, arguing that humanity is on the cusp of an inflection point (moving beyond evolution to design thinking) that has the potential to 'change everything' in the reasonably near future. He identified four significant disrupters:
The implications of these disrupters are, frankly, rather daunting. Synthetic biology offers the prospect of defeating disease, but at what cost? Quantum computing has the potential to render electronic security systems useless. One doesn't have to be a rocket scientist to realise the massive implications for commerce, banking and warfare. Researchers and technologists are committed to bringing these capabilities to market. But at what cost to humanity? The ethical implications are not insignificant. Recognising this, Hauser suggested that the state has an important role to play, to ensure appropriate regulatory boundaries and safeguards are established. But it must act quickly, before the genie gets out. Martin Wolf, chief economics editor of the Financial Times, spoke passionately about the role of the state; in his view, the single-most important institution in human history. I first heard Wolf speak a few years ago. He left a strong impression on me then, and did so again as he spoke. Addressing the question of how states can 'work better', Wolf named several important roles that the state 'must' fulfil par excellence:
Such roles need to be implemented with aplomb. Failure to do so will inevitably lead to anarchy, in Wolf's view.
 When Theresa May went on record recently, the key message for boards was that they needed to pull their socks up lest additional structural measures including employee directors become a requirement for UK companies. Much of the commentary was aimed at the boards of publicly-listed companies, in an attempt to curb (perceived and real) corporate excess in the form of excessive remuneration; hubris; and, a flagrant disregard of some stakeholders. Today, ICSA: The Governance Institute announced that it had written to the Prime Minister calling for the boards of privately-held companies to be held to the same levels of accountability and disclosure as publicly-listed firms. This request seems perfectly reasonable, especially as the UK Companies Act 2006 applies to all companies. The UK statute is clear: directors (actually, boards because it is boards that make decisions) are required to consider the long-term consequences of their decisions and the impact on employees and the community. Good practice suggests that boards should, amongst the things, keep shareholders informed (through the board's annual report to shareholders) of its activities. ICSA is right to raise the issue, but will enforced compliance with codes of practice fix the problem? If boards act within the law and in accordance with codes of practice as they pursue business objectives, then letters such as the one written by ICSA should not be necessary. But they don't. Some directors and boards take liberties. Enough examples have come to light in recent years (e.g., HSBC, FIFA, Volkswagen, Fonterra, Solid Energy, Toshiba and, most recently, BHS) to suggest that some boards knowingly run close to or beyond boundaries defined in law. But where does the real problem lie? Is it with the law, the principles-based codes of practice; the directors themselves; or, something else entirely? Consider this: The road toll has not declined as a direct result of increased enforcement measures but rather a change of behaviour—drivers choosing to driver safer vehicles more carefully. Are boards any different? If boards are analogous to drivers, probably not. Unless and until boards make a conscious decision to embrace company performance as an important priority, and to do so in accordance with both established law and published codes of practice, I suspect the media will continue to be gainfully employed. Finally, shareholders have an important and oft overlooked contribution to make. Recent experience suggests that greater care is needed in the appointment process, to ensure only suitably capable directors who are intent on acting in the best interests of the company are appointed to boards. In addition, shareholders should not overlook their right to hold directors to account including dismissing those who fail to discharge their legal duties or exercise requisite care and attention.
 In 1970, Alvin Toffler's book Future Shock was published. It quickly became a bestseller. Toffler died recently, triggering a series of articles and reflections (including this one published in the New York Times) about his life and 'the book'. Toffler had an amazing ability to look well ahead of almost all of us, to think critically, and to make some sense of it all. Consider these observations by Manjoo in his reflection: Alvin Toffler ... warned that the accelerating pace of technological change would soon make us all sick. Yet in rereading Mr. Toffler’s book, as I did last week, it seems clear that his diagnosis has largely panned out, with local and global crises arising daily from our collective inability to deal with ever-faster change. That societies are racing with great speed to embrace new ideas and innovations, yet without the ability to cope with the consequences of high rates of change, might be one of the great problems of our age. Perhaps those in influential positions in society have a responsibility to shift their gaze, from their own ambitions towards altruistic ideas that serve the greater good? This is by no means a call to embrace utopian principles nor uniformity because we are all different. Much pragmatism is needed if society is to continue to endure. Leaders—of all types but especially business leaders, company directors, politicians and academics—could do well by (re)reading Future Shock. We need to talk about stuff, because we all have much to learn.  Guest blog: Tim Sillay (Wellington, New Zealand) I'm angry. It appears that as a society, we are hell bent on eliminating risk. There doesn't appear to be any sensible discussion on acceptable levels of risk, witness the current implementation of the health and safety legislation. When you see a site board on a building site list 'uneven ground' as a hazard, it is obvious that things have become seriously retarded. Now I'm not saying we should stand idly by and watch people bury depleted uranium, or leave boxes of dynamite laying around school playgrounds, but these futile attempts to wrap the world in cotton wool are breeding entire generations with no ability to assess or manage real world risk. What it is breeding is an entire generation of 'non-producers', paper shuffling bureaucrats whose job it is to police this whole mess. Let's face it, we've cut down all the trees in the playgrounds and removed all the really fun playground equipment, so little Johnny has no idea that walking on a slender branch will eventually result in hard contact with mother earth. You can't play bull rush or ball tag, so he also has no idea that fast moving people or things really hurt when they hit you... How are you going to figure practical application of geometry if you don't live the dream of 'tangent to the arc' on the witch’s hat? How do you figure out that some kids are better at sport, some are better at math and some are just plain stupid if everyone gets a certificate for participation. So by the time Johnny has completed his tertiary education and graduated with real world skills in something like coffee making, subsequently sued his employer for allowing him to come into contact with a hot cuppa and taken a nice safe office job as a health and safety inspector in an egalitarian agency where everyone has an opinion and everyone’s opinion matters, little Johnny, with no ability to judge what is and is not a real world risk, with no concept that someone may be smarter, more experienced or just plain crazy is the man who may eventually rise through the ranks and craft policy. With no one to argue the toss, the policy pendulum has swung firmly to the outer limit of 'no risk is acceptable' and 'all people are equals'. Which is patently ridiculous. This is just not the way the world works. This is what happens when as a country, you stop producing things. You lose the generational memory and experience of what it means to balance risk and reward. You forget that some people are good at thinking about stuff and some people just like to do stuff. The western world would not exist if it was settled under this legislation. When the thinkers start mandating to the doers, or the doers revolt against the thinkers, when you reach a point in the development of civilisation where no injury, code violation or upset feelings shall go unpunished, you are, quite frankly, fucked. But here I find a startling double standard. Let's start with a Saturday evening some three weeks ago when I received the unsettling news that a wonderful lady and long time acquaintance of ours had been murdered by her friend. Shock, disbelief, anger but most of all a sense of a grand imbalance in the fabric of the world. How can such a gentle girl have met such a violent end? What possible sequence of events led to this? How did we as a society so obsessed with the elimination of risk let this happen? And there it was, that of which we shall never speak, our old bed fellow mental health. Over the last 30 years as we moved inexorably towards this sham world of universal acceptance, equality, tolerance and non-productivity we forgot that crazy people are actually crazy. Somewhere, in spite of all the signs to the contrary, we forgot all about unacceptable risk. I fail to see the chain of logic symbolised by these responses:
Somewhere, the policy wonks ran riot over the doers, those who lived the reality of day-to-day life with the insane. I can hear the sharp intake of breath. I can hear the agonised humanitarian wails of "You can't say that". I can even hear the bean counters rationalise it on a cost basis. I bet if you listened carefully, on a quiet day where the wind is blowing in just the right direction, you'll find an actuarial report that rationalises the occasional damaged child or other collateral damage about a crazy person gone off the rails. But you'd better be whispering. We NEVER discuss this kind of thing in polite society. So here's a brief history lesson. Teenage Suicide. It was a bloody epidemic in the 80's. I lost several from the circle and it hurt. It hurt a hell of a lot. Witnessing the grieving parents of a teenage girl will stay with me forever. It was more horrendous than the senseless killing of my friend by a crazy person, in as much as there is a scale for these things. It obviously was a problem, it obviously wasn't acceptable. So what did we do as a society? WE STARTED TALKING ABOUT IT. So I applaud the news that Coroner Michael Robb is conducting an enquiry into mental health related killings. Long may it make front page news. Maybe, just perhaps, this senseless, vile, unfathomable thing is the point where we all cry ‘enough’. Guest blog: Tim Sillay (Wellington, New Zealand)
Busy-ness seems to be a fact of life for many people these days. Whether it is running between commitments, as a business person, as a parent or anything in between, downtime has become a precious commodity—one to be treasured and nurtured. Modern conveniences like unlimited wifi (including on some flights nowadays) mean we are never far away from activity and doing things that, in our own mind at least, add to our personal sense of worth. While busy-ness can be a good thing, more often than not sustained periods of busy-ness will lead to reduced effectiveness and possibly even burnout or breakdown. We get so wound up doing stuff that our world closes in around us, until we lose sight of 'why'—our True North. Loosing perspective is not good for us, or those around us. As a senior executive or company director with significant responsibilities, you no doubt have a busy schedule. How do you keep things in perspective to ensure that you are actually effective in your work? Do you have an anchor, a True North, and do you referencing back to it? For me, downtime is the key to effectiveness—slowing the heart rate; getting away from people; taking time out to explore ideas (that would not normally even register on my everyday radar); and, in so doing, remind myself of what really matters, my True North. I do that by reading. Here's a selection of the books currently on my reading list. If you read as a means of maintaining your perspective, I commend them to you.
PS: What you do to keep track of your True North doesn't really matter. Go for a walk, paint, read, sew, draw or whatever else takes your fancy. That you are taking time out from the busy-ness of life is what will make the difference to your effectiveness—as paradoxical as that may seem.
One of the biggest shake-ups to confront the Western World (since the collapse of communism and the fall of the Berlin Wall anyway) occurred in the United Kingdom last week. The result of a much anticipated plebiscite was a decision by the British people to leave the EU. In the weeks leading up to the referendum, the flow of information became a cacophony as politicians, scaremongers and other 'experts' promoted various positions, in an effort to influence to voting public. Finally, the day arrived and the people voted. Soon, the results were published. The people had spoken. Some cheered while others mourned. Curiously, some reacted by rueing their decision, wondering whether they had voted wisely. Really? With a straightforward question to answer and a plethora of information to hand, how could anyone make the 'wrong' choice (unless they didn't vote, of course)? Is this reaction an outpouring of buyer's remorse on a national scale, or is something else going on—an indication that some did not take the decision seriously or that a dose of hubris clouded the better judgement of some voters perhaps?  The British plebiscite highlights a behavioural weakness that besets many people. From an early age, we spend our lives learning as much as we can, aspiring to become experts in whatever field interests us. Most of us want to excel; to realise our potential. In our haste to make decisions and get ahead, we tend to embrace new ideas and disregard 'old' ones. If we can secure an advantage, we'll take it—thank you very much. But when it comes to big decisions, we may not be as smart as we think we are. Decisions that are based on politically-motivated or emotion-filled pleas, or knee-jerk responses seldom deliver the 'best' outcome. Often, the best decisions are those made after we have paused and looked back, for guidance about how best to move forward. Whether we are cast as leaders or followers, we could do far worse than to seek out people like Bill and Augusto, sit with them and, having asked them a question, listen intently to what they have to say. Our challenge, having sat and listened, is to act on the wisdom passed to us.
 As 2015 gives way to 2016, many people will be reflecting on the past and looking to the future; thinking about what was and what might have been. I'm no different. One of the books I've been reading while pondering the past and the future this week is The Servile Mind by Kenneth Minogue. A friend recommended it—he wondered whether the commentary might be applicable to directors and boards. My response, having read half of the book so far, is an unreserved 'yes'! Here's the note on the flyleaf: One of the grim comedies of the twentieth century was that miserable victims of communist regimes would climb walls, sim rivers, dodge bullets, and find other desperate ways to achieve liberty the West at the same time that progressive intellectuals would sentimentally proclaim that these very regimes were the wave of the future. A similar tragicomedy is playing out in our century: as the victims of despotism and backwardness from Third World nations pour into Western States, academic and intellectuals present Western life as a nightmare of inequality and oppression. In The Servile Mind: How Democracy Erodes the Moral Life, Kenneth Minogue explores the intelligentsia's love affair with social perfection and reveals how that idealistic dream is destroying exactly what has made the inventive Western world irresistible to the peoples of foreign lands. The Servile Mind looks at how Western morality has evolved into mere "politico-moral" posturing about admired ethical causes—from solving world poverty and creating peace to curing climate change. Today, merely making the correct noises and parading one's essential decency by having the correct opinions has become a substitute for individual moral responsibility. Instead, Minogue argues, we ask that our governments carry the burden of soling our social—and especially moral—problems for us. The sad and frightening irony is that the more we allow the state to determine our moral order and inner convictions, the more we need to be told how to behave and what to think. Humbly, I commend this book to all directors who want to govern well and make a difference in 2016.
In November 1787, George Washington offered this advice in a letter to his nephew Bushrod: “Rise but seldom—let this be on important matters—and then make yourself thoroughly acquainted with the subject. Never be agitated by more than a decent warmth, & offer your sentiments with modest diffidence—opinions thus given, are listened to with more attention than when delivered in a dictatorial stile. The latter, if attended to at all, although they may force conviction, is sure to convey disgust also.” What profound advice. Could it still be relevant in the always-on and rather selfish culture that has pervaded the twenty-first century? We live in a world infested by sound-bites in search of ears. Sadly, many offer little more than noise. The paucity of in-depth or critical thought is stark, yet we continue on—often blindly—in pursuit of change. If real progress is to be made to effect change, whether it be in the halls of power, boardrooms, executive suites or on the factory floor, might a 'rise but seldom' philosophy offer more hope than the prevailing sound-bite culture? On Washington's example, the answer could be 'yes'.
Every day, around the world, leaders in the health sector face a formidable challenge. On one hand, insatiable demands press in as people expect physical and mental health (foundational to our well-being). On the other, resources are limited—providers simply can't do everything. Consequently, tough choices need to be made, to ensure the appropriate services are delivered, efficiently and effectively. The complexity of the problem means 'best practice' answers are few and far between. However, progress should be possible if a clear sense of purpose, appropriate strategy and effective monitoring systems are all in place. The England Centre for Practice Development is hosting an interactive seminar on 11 September, to help health and social care sector leaders explore these key issues and challenges. I have been asked to facilitate the seminar, and to share insights from research and experience in boardrooms. Topics to be discussed include:
If you are a board director or an executive of a clinical commissioning group or health provider; a policy maker; a researcher; or, an interested party, I encourage you to join the debate.
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Photos used under Creative Commons from ghfpii, BMiz, Michigan Municipal League (MML), Colby Stopa, MorboKat