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    "Involve the non-executive director in strategy"

    Accountability Decision Making Governance Performance Research Strategy
    The board's involvement in strategy has been hotly debated in some quarters in recent years, especially as the focus of attention for business performance has moved from the chief executive to the board. Is strategy the domain of management, or of the board?
    Thankfully, the extreme options (strategy is totally the responsibility of management or imposed by the board) are no longer widely supported. The discourse seems to be coalescing on the more collaborative options of a board-led, managment-led or a joint development process—although the merits of which one of these is 'best' continue to be debated.
    Once directors and managers understand what strategy is (check the graphic), a decision to actively involve the board seems obvious. If the purpose of the board is to ensure the long-term performance of the company, in accordance with the wishes of shareholders, why wouldn't the board roll up its sleeves?
    An increasing number of commentators are now nailing their colours to the mast on this point. For example, this article, published in Director (the Institute of Directors' magazine), recommends that all non-executive directors (NEDs) should be actively looking at all strategy options and be making strategic decisions. I couldn't agree more, but would add that all directors (not just NEDs) should be involved in the process, together. While this recommendation demands more of directors, emerging research seems to suggest the approach is not without merit.
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    Corporate governance & board performance: emerging research

    Conferences Decision Making Governance Performance Phd Research
    Are you interested in the latest developments in board and corporate governance research? If so, you might like a sneak peek at two new papers, both of which have practical implications for board research and boards in action. The full papers will be presented at two leading corporate governance conferences in Europe in November.
    Summaries of conference presentations will be posted here during the conferences. Use EIASM15 or ECMLG15 in the search field to go directly to the postings. 
    If you are interested in attending the conferences or want to know more about them, follow these links to the EIASM and ECMLG conference pages. If you want more information about my research (including its practical application in boardrooms), please get in touch.
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    When boards are dissected, they are no longer boards

    Decision Making Governance Leadership Performance Phd Research Strategy
    The modern society we live in has many benefits. Life expectancy and well-being have steadily improved for many: health and education being important building blocks. Most would agree that progress has been 'good'.
    Paradoxically, life has become more complex in some quarters, and answers to some everyday problems remain elusive. The human response to complexity—dissection in search of 'truth' and understanding—has not helped. The reductive assumption that the sum of knowledge of the parts explains the whole is helpful in science, but in social science it fails. Companies (boards, in particular) are a case in point. The pursuit of a single truth ('best practice') is about as helpful to understanding how boards work as dissection studies of body parts is helpful to understanding how humans interact or experience life. 
    The problem is that when boards are dissected and individual elements are studied in search of answers about how boards work, the subject of research is no longer the board. Thus, the very essence of the socially-dynamic entity (the board) being studied is lost. As a consequence, any conclusions cannot, by definition, be representative of what the board as a whole is, does, or might contribute. 
    If we are to understand how boards work and to discover any relationship between boards and business performance, boards must be studied holistically: both in situ and in action. While every situation considered by a board is (to a greater or lesser extent) unique, emerging research suggests that some patterns can be discerned if the empirical data collected from within the boardroom is abstracted. An important dependency appears to be the decisions made by the board when it is in session. The quality (and, therefore, the potential impact) of board decisions appears to be associated with the quality of social interactions between directors and qualities of the directors themselves, as they seek to fulfil their duties. These qualities and social interactions are the subject of my doctoral research, currently before the examination panel. I look forward to sharing the results of this work, here and elsewhere, once the examination process is complete.
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    On the role of the company secretary

    Accountability Decision Making Governance Performance
    This recently published summary of a meeting held to discuss the role of the company secretary caught my eye today. The company secretary has an important supporting role (preparing reports including compliance reports, recording minutes and managing the processes of the board) in most companies. However, some meeting participants appeared to suggest that a greater role was appropriate:
    The meeting followed the publication of ICSA’s report The Company Secretary: Building trust through governance, which found that company secretaries ‘make a significant contribution to board performance’, supporting ICSA’s wish to reinstate the legal requirement for all large private companies to have company secretaries. The topics that were discussed at the roundtable included governance, messaging, tone, teaching, acting as the ‘radar’ of a company and being the ‘bridge’ between the company and stakeholders.
    This conception is helpful, except that it perpetrates the widely-held view that corporate governance is a conformance activity. However, the responsibility to act in the best interests of the company in pursuit of shareholder wishes lies with the board. Thus, a conformance conception provides the wrong basis upon which to understand board and company secretarial contributions.
    Someone needs to have their finger on the pulse in terms of strategy, monitoring, process and shareholder communications. Ideally, these are tasks for the board as it discharges its duties. In those cases where the board is weak, aloof or less than fully engaged, these tasks tend to fall on the company secretary (or even the chief executive in some cases): the requisite processes and compliance tasks still need to be performed. Thus the thinking of many in the governance community including those cited in this report it would seem.
    An expanded conception of the company secretary role may remedy the symptoms (and serve the interests of company secretaries hoping to elevate themselves), but it does not address the root cause. The focus needs to be on the board, its roles and its contribution to business performance. Candid discussions around the board table and, potentially, with shareholders will probably be necessary. However, the benefits of resolving the board's role are likely to be many including that the company secretary would be released to perform their role as first conceived: to provide an outstanding administration and support service.
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    Applied research: Strategy in the boardroom

    Decision Making Governance Leadership Research Strategy
    My nine-day visit to the UK and Ireland to discuss board and corporate governance topics and to share emerging research with board directors, executives and academics is drawing to a close. From meetings in the hallowed halls of the Institute of Directors on Pall Mall, office buildings, various fine dining restaurants and cafés, and university premises in Wolverhampton and Ulster; to master class presentations and a guest lecture, it has been a delight to engage with people who are deeply interested in corporate governance and the board's role in business performance. Thank you.
    Now, the task of addressing the numerous requests for more information, and to schedule future meetings, speaking and advisory engagements beckons. This is my priority over the coming days.
    Amongst the enquiries and discussion notes, several people have asked for more information about strategy in the boardroom. While I have written about this in the past, and strategy has been a core element in my doctoral research, interest in up-to-date applied research appears to be high. Given this, my intention is investigate some of the practical challenges faced by boards over the coming months and to publish the findings. However, such research needs willing participants...
    If you or your company board might be interested in participating in research, please get in touch. I am particularly interested in publicly-listed firms, high-growth businesses and social enterprises; in the UK, Europe, the US and Australia. Your expression of interest and any decision to participate (or not) would be entirely confidential, and neither you nor nor your company or social enterprise would be identifiable in any research report that ensues.
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    Getting over ourselves: a crucial competence for directors?

    Accountability Decision Making Governance Leadership Performance Research
    Board meetings are uncompromising places of work and decision-making. Not only are boards themselves inherently socially-dynamic (they are make up of people, after all!), but every situation is different and directors meet infrequently and they generally need to act on incomplete data.
    Consequently, decision-making effectiveness is largely dependent on directors working well together when the board is in session. However, that is much easier said than done. In fact, recent research suggests that we humans struggle to understand the minds of others, even though we think we are good at it. This renders group dynamics difficult, at best. 
    Image description
    One of the biggest barriers to understanding is egocentrism—we can't get over ourselves. We over-estimate knowledge and capability, including that of others to understand what we say or mean. The problem is exacerbated by the technological world of electronic mail (which strips out tone and meaning), and even more so the abbreviated 140-character world of Twitter and text messages.
    If directors are to make effective contributions in boardrooms they need to get over themselves. Older and more experienced directors are not exempt from this problem—they are just as prone to making assumptions as their younger or less experienced colleagues. 
    Techniques that might be helpful for directors wanting to make effective contributions include meeting together in social settings to learn more about each other; asking questions during board meetings with open hands and a humble spirit; careful (reflective) listening, to limit assumptions and check understanding; and, the demonstration of a collective empathy amongst directors. Perhaps it might even be helpful to appoint a psychologist onto the board! Please note this is not a categorical list—if you have evidence-based suggestions, please feel free to share them.