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    Boards: a timely call for courage

    Governance Leadership Management Performance Strategy
    I had the pleasure of working with 24 outstanding business leaders and company directors yesterday—delegates on the IoD Company Director's Course. The topic of the day was strategy, as it always is on the second day of the course. My task was to lead the day and provoke discussion and debate, as part of the learning experience. The entire course is run under The Chatham House Rule, so delegates can speak freely and use real-world examples without fear of sensitive information being made public. However, some of the themes and conclusions that emerged from the discussion can be mentioned:
    • Boards need to be involved in the development of strategy, in some way.
    • A standard lexicon is crucial, so that everyone knows and understands what is meant when certain words are used. (We had a lengthy discussion on the question, "What is strategy?")
    • Boards owe a duty of care to ask probing questions of management, to satisfy themselves as to what is really going on.
    • Business is complex and strategy development is not straightforward. Things change, and sometimes tough choices need to be made, often without complete information.

    As we worked through the day, it became clear that the delegates had a realistic view of how boards and business actually work, and they recognised that there is often a gap between [tidy] theory and [somewhat messy] practice. The separation of governance and management, first espoused by Berle and Means in 1932 and now accepted dogma for companies in the Anglosphere, may not be the best model, for example. The discussion reminded me of a timely call made in an article that appeared in The Conference Board Review recently:
    Unfortunately, despite the theory on how boards are supposed to work, the reality is considerably messier. Reinvigorating boards with curiosity and courage would be a very good place to start fixing what is broken.
    Hopefully, delegates are able take away something from the course to ponder and challenge their status quo and some of the accepted maxims of governance. Boards cannot afford to remain as "parsley on fish—decorative but useless" (Irving Olds, Chairman, US Steel 1940–1952). If the behaviours and comments of the CDC delegates this week are any indication, curiosity and courage may be about to re-enter our boardrooms.
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    NACD Commission on strategy: An increased role for the board?

    Governance Leadership Performance Strategy
    The National Association of Corporate Directors (NACD) has announced the establishment of a commission to make recommendations about the "board's role in recalibrating the enterprise's corporate strategy in response to market forces". The decision, to consider the topic and present guidance, is a positive step towards more effective governance in the USA.

    For some time now, researchers have suggested that strategy needs to be part of the board's remit, although a consistent interpretation of what that means remains unclear. Some directors and consultants think boards should be actively involved in the process. Others disagree. Clearly, there are several options to be considered, along a spectrum:
    • Management drives the entire strategy development process, and the board, at best,  rubber-stamps the result.
    • The board simply approves strategy developed by management. This is the default option for many companies today.
    • The board speaks into the strategy development process, but it remains largely controlled by management.
    • The board is an active participant in the development of strategy, together with management.
    • The board drives the strategy development process, albeit with considerable input from management.
    • The board imposes strategy on management.

    Irrespective of the recommendations that Commission presents later in the year, boards are responsible and accountable for business performance, and board contributions need to be recalibrated accordingly. I await the outcome of the NACD process with interest.
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    Invitation to submit a paper to #corpgov conference in Croatia

    Conferences Governance Performance Research
    A few days ago, I was invited to submit a paper to the 10th European Conference on Management Leadership and Governance (ECMLG). The 2014 edition is being hosted in Zagreb, Croatia. I'm humbled by the opportunity to offer a contribution.

    The deadline for paper submission is mid-June. My topic will 'access'. Simply stated, the paper will suggest that governance research needs to move on from its predilection with typically quantitative secondary data, to study what actually occurs in the boardroom. It is my view that first-hand observations are crucial if we want to truly understand how boards work, and to make credible suggestions about how they contribute to business performance. You can read the preliminary abstract here. 
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    Guest contributors on Musings. What do you think?

    Governance Readings Research
    I am thinking about the possibility of opening Musings up to guest contributions. At this stage, it is just an idea, but it is one that I am keen to explore. For the last two years, every post to Musings has been mine. I am happy to continue to be the sole contributor, however when a couple of people recently asked me whether I had ever considered inviting others to provide contributions, it set me thinking. 

    What does Musings offer? It's an outlet to share ideas—about corporate governance, strategy and our place in the world. From small beginnings, the readership has grown, to the point where over 4000 unique visitors drop in each month. Something about the blog must interest people.

    Anyway, to the question. Would you like to read contributions from other folk from time to time, to provide some variety? Would this be appreciated? The general theme of Musings would stay the same.

    Please reply here if you have an opinion, or contact me directly if you'd like to become a guest contributor. 
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    Paper accepted onto BAM Conference programme

    Conferences Governance Phd Research
    I received some wonderful news today. My paper, entitled On the use of critical realism to advance governance research beyond correlations, has been accepted onto the main programme of the prestigious British Academy of Management Conference, to be held in Belfast, Northern Ireland in September 2014. You can read the abstract on the Research page if you'd like to know a bit more. (A copy of the full paper will be posted after it is presented at the conference.)

    It's humbling to know that others see my work as worthy to be included at this conference. I'm grateful for the opportunity. The feedback that the three reviewers provided (through the usual double-blind review process) was really helpful—both in terms of tweaking the paper, and as guidance for the doctoral thesis as it comes together through the remainder of 2014. Now, to save my pennies for the flights!