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    Better board work: what does 'good' look like?

    Conferences Corporate Governance Governance Leadership Research Speaking Engagements
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    And there you have it: before many of us realised, the solar equinox has passed once more—that moment when the sun passes the celestial equator and winter (or, for those in the global south, summer) beckons.
    The equinox also signals the recommencement of on-the-ground contributions in the Northern Hemisphere. To wit, I shall be in the United Kingdom and Switzerland soon—from 2nd through 13th October, in fact. My programme sees me in London, Leeds, Cambridge, Zurich and St. Gallen, for a variety of contributions:
    • ​meetings with boards, directors and colleagues;
    • a private luncheon with a doyen of corporate governance;
    • two conferences (EIASM 20th anniversary workshop on corporate governance, in St. Gallen; and, the IBEM thought leadership conference, in London);
    • delivery of two keynotes and a guest lecture; and,
    • some quiet time writing.
    I am looking forward to hearing the heartbeat of company directors, advisors and others, to understand recent developments and emerging trends, and to discern changes since I visited earlier this year.
    I have intentionally held space available for a few informal meetings. So, if you want to meet up while I am in your neighbourhood—be it to discuss the work and impact of boards, corporate governance, or some other topic of interest—do get in touch. I would be delighted to hear from you.
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    Do you have a question about governing with impact, or driving organisational performance?

    Accountability Corporate Governance Decision Making Director Development Effectiveness Governance Leadership Performance Tough Questions
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    One of the great joys of being an independent advisor is the opportunity to spend time with people from a wide range of backgrounds; business and social experiences; walks of life; and, in my case, countries and cultures. The depth and breadth of humanity never ceases to amaze me. Paradoxically, a common thread runs amongst the diversity: people intent on improving organisational effectiveness and making a difference spend lots of time asking questions, lots of questions.
    When a question is asked from the floor after a keynote talk, during an advisory engagement or professional development workshop, or as part of a confidential discussion or informal chat, something mysterious happens: Both parties learn! This should come as no surprise, for no one has all the answers—although some people behave as if they do.
    Recently, I posed several questions board directors may wish to consider. ​The response to that musing has been overwhelming, so I thought an open invitation might be in order.
    ​If you have a question about any aspect of corporate governance, strategic management, board craft or the challenge of governing with impact—either personally or on behalf of a board you serve on—please ask and I will gladly respond. Use the comment link here or, if you prefer, send an email. Let's learn together!
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    Chairmanship: a mechanical process, or a deft art?

    Accountability Corporate Governance Decision Making Leadership Performance
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    Board are funny things. They are comprised of selected individuals (directors, board members) charged with meeting together to consider various matters for the purpose of making decisions. While it is true to say directors meet, decisions are made by the collective whole—the board—not individual directors. Therefore, every decision is unanimous. Complicating matters, boards only 'exist' when directors meet, and board work is, largely, endogenous; so, they need to be coordinated—someone needs to 'drive' the board. ​​​
    The term 'chairman' (also, 'board chair, 'chair' or sometimes, 'chairperson') is the term used to identify the board member who carries such responsibilities—these being to convene the board’s meetings, ensure duties are discharged, and that steerage and guidance (that is, governance) is effective. But, as all directors are equal in law, the chair's role is exercised through influence, not command in any controlling sense. Given this, how should a board chair, well, chair the board? ​
    While there is no one 'best' way of chairing, the following characteristics are conducive to better outcomes:
    • Build relationships: Effective chairs nurture trust and respect within the board; with management (especially the chief executive); and, with shareholders and legitimate stakeholders. 
    • Understand the business and the wider landscape: This includes corporate strategy and operations, organisational culture, competitive landscape, and emerging trends and disruptions.
    • Lead on purpose and values: The board needs to set the direction and the basis for decision-making and conduct. Sometimes, tough (even unpopular) decisions are needed, to ensure alignment and to secure in the long-term interests of the company.
    • Boardroom culture: Exercise tact and sensitivity, and maintain decorum. Respect confidences and maintain utmost confidentiality when required. Emotional intelligence, situational awareness, maturity, wisdom, and the ability to draw out the best in others are critical to effective chairmanship.
    • Show decisive leadership: Empathy and understanding is important, but only to a point—for these attributes do not drive decisiveness. Sometimes, assertiveness from the chair is required.
    • Learning and development: Effective chairs know they don't know everything—far from it—and things change anyway. Consequently, they tend to have a continuous learning mindset.
    • Nurture a broader skill set: Technical skills are necessary, but they are far from sufficient. The best chairs read widely and they encourage other directors to do so as well.
    • Embrace multiple perspectives: Eliciting different points of view during ideation and when debating topics is crucial if the board is to guard against groupthink. Cognitive diversity is important too; it has been shown to be an antecedent of higher quality decisions.
    • Listen: Chairs should speak last, having drawn and heard from others. When the time comes to speak, do so clearly and succinctly, and encourage colleagues to do likewise.
    • Manage time:​ Start on time, ensure the board moves steadily through the agenda and where practicable finish on or near time.
    • Ensure continuity: Consider succession, especially for the chief executive role but also for the chair.
    Governance is tough because, inter alia, things change, sometimes unexpectedly; boards often need to make decisions without all the information they want; linkages between decisions and outcomes are contingent; and, directors' duties are unbounded. 
    If boards are to govern with impact, chairs need to be alert: to ensure directors are actively engaged, and that they identify and consider relevant information, think critically and, together, make smart decisions in the best interests of the company. The chairs' priority is to convene the board and its work, and keep directors on track and the organisation safe. For this, a deft hand is needed.
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    Ten days in the UK & Europe: A snapshot

    Accountability Corporate Governance Diversity Family Business Leadership Research Strategy Value Creation
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    I have just arrived back in New Zealand, from ten days in the UK and Europe. My meetings with directors, advisors, academics, students and directors’ institutions had two primary objectives: to listen and to share. The listening aspect was to gain firsthand knowledge of issues and opportunities; the sharing aspect to provide updates on the craft of board work and my experiences as a practicing director.
     Learnings (a few immediate observations, in no particular order):
    • Directors say they are finding it hard to distinguish between signal  and noise—that which is material to monitoring and verifying performance and progress, and that which is, essentially, argumentation from stakeholders asserting preferences with only tenuous associations with sustainable performance.
    • ESG remains 'hot', although everyone I asked said the marketplace was fracturing. Acolytes are becoming more assertive, especially in their expectations that companies prioritise net zero, climatic change response, and equity above all else. Others are less convinced, as they are yet to see any increase in company performance or alpha. The gap between the groups is growing too—adherents have started using the 'anti-ESG' moniker, in an effort to claim the high ground. Detractors have not been silent either, saying the discourse needs to move away from what they describe as ideological fervour to pragmatism and common sense. 
    • Increasingly, directors are questioning whether quarterly board meetings (common in Europe) is actually a good idea. The directors I spoke with said they find it really difficult to keep up with compliance matters, much less contribute well to strategic items. The power balance leans reasonably strongly in favour of the CEO too.
    • Calls for optionality to be removed are becoming more commonplace. (Optionality meaning all directors of companies of substance should be required to be professionally qualified, in the same way as doctors and lawyers need to achieve and maintain a relevant professional accreditation.)
    • Geopolitical turbulence is front of mind (greater in Eastern Europe than Western Europe). The situation is exacerbated by economic headwinds and energy security concerns (think: gas and electricity supplies) despite Europe emerging from a mild winter. The UK and France (in particular) are also struggling with high inflation, strikes and, in France, a proposal to raise the age of retirement. Given the uncertainties, many leadership teams have shortened their strategic horizons and some have become quite defensive.
    • The Credit Suisse bailout by UBS unfolded before my eyes—I was in Zürich the day after the failure. Like many other failures, this one came as little surprise to insiders; the company has endured scandals and criticism for some years. (My early assessment: the board appears to have been asleep at the wheel.)
    • Directors continue to struggle with what corporate governance is and how it should be practiced. Sadly, the confusion observed during this trip is as widespread as in the past. Directors' institutions have a critical role to play, to clearly and straightforwardly assert what corporate governance is and, critically, what it is not. 
    Amongst it all, there were some gems:
    • ​Several directors spoke passionately about their work, and how efforts to engage more actively, with an underlying sense of purpose, is starting to make a difference.
    • Researchers are moving focus, from quantitative studies using public data, to trying to get inside boardrooms to observe boards in action (ie: the practice of governance).
    • Advisors to General Counsels, CEOs and SME founders have recognised a different conversation is needed to appeal to boards and directors. I was pleased to offer a few insights and suggestions.
    • I had the delight of delivering a guest lecture to forty or more researchers and students at Leeds Beckett University. The Q&A was fascinating—a candid exchange with people passionate about helping boards govern well.
    Several followup visits are now being planned, to advise, assess, educate and speak on topical board and organisational performance matters. If you want to discuss a matter of interest, or check my availability to assist, contact me for a confidential, obligation-free discussion.
    The headline picture, showing a derelict property in Soho, London, is analogous to the state of governance in many places in Europe: structurally sound but outwardly messy.  
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    Reflections, on a most interesting year

    Accountability Effectiveness Governance Leadership Readings
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    ‘That’ time of the year has arrived once more. For many, the time to put the tools down and relax for a few days is nigh. From the hustle and bustle of public life, families are gathering. Some will celebrate the significance of Christmas, others will celebrate because any opportunity for a party with friends and family is a good one. Amongst it all, some will work on, especially in healthcare, emergency services, process manufacturing, retail and hospitality; we should not forget them for they too have family and friends.
    I am one amongst many who carve out a little time and space towards the end of December to reflect on the year gone. Often, my mind is drawn towards relationships and experiences. This year is no exception.
    • The re-emergence of people from the depths of the covid malaise has seen conversations about sustainability (and close cousins climatic change and ESG), stakeholder capitalism, and cyber security return to centre stage. These discussions are important, and boards cannot afford to ignore them. But boards should not be deferential to them either. The role of every board is to provide steerage and guidance, in pursuit of an agreed goal, having carefully assessed and taken into account the wider context within which the organisation operates. This is the craft of board work.
    • The high level of polarisation and discord apparent across communities and nations, and between nations too, is disheartening. I'll not comment further; to do so would mean stepping into politics and nationhood, themes that seem to activate stridency and, at times, conflict. I am ill-equipped to debate the issues with confidence anyway! Regardless of what swirls around, I remain hopeful for the future, that cool heads and calm rational thinking will prevail.
    • Many of the boards and organisational leaders I've spoken with in the past six months are concerned about the effects of geo-political turbulence and economic headwinds. They say they are active in their efforts to distinguish between signal and noise: monitoring  the wider market closely, checking strategic priorities remain fit for purpose and operational plans are on track, and making adjustments where appropriate. Smart boards are also investing in both organisational resilience and themselves.
    • And a personal item, with learnings for board work. An injury sustained in April (comminuted calcaneal fracture) resulted in various post-pandemic plans (notably, fulfilling international engagements) being put on hold. Thankfully, the recovery progressed without complication, although my patience was tested at times. By mid-September, I had sufficient mobility to travel internationally again. Now, nine months on, my shoes and boots fit once more, and I can do most things again, which is wonderful. The experience has provided many lessons, not only for me but also insights for boards and organisations. More on this in 2023 (or, get in touch if you have an immediate need for assistance).
    Before signing off this last post for the year, a note of heartfelt thanks. Thank you to everyone who has seen fit to consider my ideas, challenge my thinking, and invite me to work alongside them this year. To have been afforded the opportunity to contribute, globally, has been delightful. The calling, to serve and support boards intent on realising organisational performance, remains strong. Consequently, the work will continue in 2023, starting in early January with responses to a long list of enquiries to assess, advise, coach and speak.
    Now, I have one report to complete, a client event to attend, and a few Christmas errands to run. Then, I shall set the tablet and pencil down, in favour of a book or two, my vegetable garden, a few small jobs around the house, and some quality family time.
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    The craft of board work; 21 years on

    Corporate Governance Governance Leadership Management Performance Research Sustainability
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    Twenty-one years ago this week, I embarked on a journey to pursue a dream: to help directors and boards become value creators, realising the potential of the companies they govern. At the time—four weeks after the terror attack on the World Trade Centre—governance was hardly known as a word, and most boards had a strong compliance orientation. I had no idea whether the dream was realistic, much less attainable. But, at 39 years old, the calling was strong—compelling even. So, I took a deep breath and walked away from a great company and international role, armed solely with a strong belief that I might be able to add some value. I was told that stepping away from financial security and the makings of a stellar international career was crazy. But the decision had been made.
    I found that people would happily talk about their situation and what they wanted to achieve if they thought you were genuinely interested in them. That insight has provided the foundation for everything that followed—including working with thousands of directors in 45 countries across five continents, serving on boards, delivering hundreds of talks and leading many education sessions. The 2012–2016 period dedicated to complete doctoral research, to try to answer that most difficult question of how boards influence company performance provided a breakthrough that I hope, one day, will be taken up widely: the Strategic Governance Framework. To have met and spent time with doyens of corporate governance, strategy and leadership along the way—including Bob Garratt, Bob Tricker, Charles Handy, James Lockhart, Jenny Darroch, Roger L. Martin, Rita Gunther McGrath, Silke Machold, Stuart Farquhar, Andrew Kakabadse and many more besides—has been inspirational. I am indebted to everyone who has spared a few minutes to answer questions and share insights.
    Other highlights include sitting with directors in India, Eastern Europe and other places well off the beaten track, to listen; experience their thirst for insight; and receive their gratitude for what little I had to offer. 
    Without exception, everyone I've met and worked with has wanted to find ways to guide and steer the businesses they govern with greater effect. To have been asked to contribute has been a honour. ​
    Thank you to every established director, board trustee, and board chair; every aspiring director; every chief executive and leadership team; every MBA student, researcher and associate; everyone who has heard me speak or read my articles (note: all my articles and blog posts remain available today); every regulator and government who sought confidential assistance; and, untold others I've never met. Thank you for considering my submissions and arguments, for believing in me, for encouraging me and for engaging me.
    Today, 21 years on from stepping out of the boat, the calling remains strong. I remain available to serve for as long as boards and directors call for assistance, and my ability to contribute allows. To that end, and with the passing of the pandemic, I am available once more to travel to meet in person to understand and speak into situations. So, if you have a question or want to discuss a problem, please get in touch. I stand ready to serve.