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    Back into (writing) gear

    Corporate Governance Decision Making Governance Language Research Tough Questions
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    Over the past couple of months, I have been deeply embedded in a pro-bono advisory engagement, and fulfilling several speaking and capability-building assignments—to such an extent that my writing has languished. Progress on Boardcraft stalled, and my last blog entry was back in May. But now, with those commitments in hand, I have surfaced to draw breath, scan the vista, and to begin writing again.
    Starting next week, I will pick up my pen (keyboard!) once more, to share my thoughts and observations on corporate governance, the board's role in driving organisational performance, and other topics that catch my attention. Expect a new muse some time on the first Monday of each month.
    As we get going again, may I ask a favour? Please tell me what you want to know about (as a comment to this post or via private message) and I'll do what I can to respond. This is a genuine offer to explore anything of interest—except if it is illegal or immoral, of course!
    For now, have a great weekend. See you Monday!
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    On commitment: how far will you go?

    Accountability Decision Making Family Business Governance Performance Tough Questions
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    Several times in the past year, I have been asked for advice, even to intervene, in situations where relationships between board members have become strained, or shareholders have fallen out—with each other or with board members—over differing expectations around returns and/or succession. Each situation has been both complex and demanding, for they involve people and human emotion.
    The following vignettes are illustrative of the types of things that can go wrong and the ensuing behaviours of various actors:
    • ​Four directors of Christchurch City Holdings Limited have resigned following a relationship breakdown with CCHL’s shareholder, the Christchurch City Council. Reports suggest the shareholder wanted dividends paid at levels the board thought was above what CCHL could sustainably provide. Despite considerable effort to resolve the matters, four directors have decided that the demands are unreasonable; enough is enough, and they have walked away. One, Abby Foote, is an esteemed director and Chartered Fellow of the Institute of Directors.
    • A large-scale family company has been experiencing some difficulties, and several ‘next generation’ leaders think the patriarch should step aside. The company has a long history of success and balance sheet growth, and it has enjoyed a positive reputation in the market. But now, the patriarch, who thinks he is still the best person to run the business despite poor health, has become a stumbling block. The sole independent director can no longer claim to be independent either, as she has been captured by the patriarch. Family members are frustrated, and company performance is languishing.
    • The shareholders of a business active in agriculture and forestry in two countries have found themselves at odds over the future of the business. The largest livestock unit has struggled to make a profit in recent years, and the trees on the main forestry block are reaching maturity. Some brave decisions need to be made to secure the future of the business. Some of the shareholders have sought advice from a consultant, and they seem to be comfortable with the advice (to harvest the trees to fund continued dividend payments that they have come to rely on), despite a clear conflict of interest (the consultant is a shareholder of a lumber milling business that stands to gain from the harvest). Other shareholders want to engage some independent advice and take a longer-term approach to sustainable performance and value creation.
    As is typical in board and shareholder matters, options are many and resolutions are far from clear cut. What options might a capable independent director consider in such circumstances?
    • Should they try all reasonable options (such as the CCHL board appears to have done), but reserve the option of resigning if a satisfactory resolution cannot be achieved; or,
    • should they steadfastly remain loyal to the shareholder who appointed them, even if they disagree and are no longer being effective; or,
    • ​should they continue to try to achieve a resolution having noted the duties owed and fiduciary responsibility, despite the risk of legal challenge and reputational damage?
    These are questions of commitment and duty. Directors need to not only recognise this, but consider options amidst ambiguity, and work within the constraints of the law and what is ethically acceptable. Essentially, these questions ask how far a director is prepared to travel, how hard they are prepared to work, how long they might prepared to wait before enough is enough. Are they prepared to make decisions that may be unpopular or even unpalatable, because such decisions are in the best interests of the company? Will they go to the ends of the earth, so to speak? Or does the preservation of reputation rank more highly than acting in the best interests of the company—essentially, will they bail when the possibility of reputational damage arises (as several directors of Wynyard Group reportedly did just before the company failed several years ago)?
    Directors would be well-advised to have asked themselves these questions before they accept an appointment. They should also be prepared to act (step away) if the thresholds they set themselves are surpassed, or if they no longer have the expertise or courage to act.
    Of the directors you know, how many possess the wisdom and maturity to act diligently, in the best interests of the company?
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    Your turn: crowdsourcing Musings!

    Accountability Corporate Governance Decision Making Governance Guest Post Readings Tough Questions
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    A few weeks ago, while facilitating a board masterclass at Naivasha, Kenya, I had the good fortune to see some local wildlife at close range. Some people consider walking in close proximity to wild animals to be dangerous, for it may portend harm or injury, but others embrace the activity with open arms.
    Thinking, that well-spring from which ideas and insights emerge, innovations are birthed, and humanity progresses and flourishes, is similarly polarising.
    One of the things I have been thinking about recently is quite selfish: What direction should I take my writing in 2024? Musings is nearly twelve years old (first entry was in March 2012, which coincided with my doctoral research efforts, and sharing of conference papers and articles). While the longevity makes it a rarity, my motivation has not changed. It has been to share thoughts on corporate governance, strategy and boardcraft; our place in the world; and other topics that catch my attention. Apart from the introduction of 'boardcraft', a word I coined in 2020, this overarching goal has remained consistent since day one.
    From humble beginnings, when entries garnered just a few readers, the blog is now widely read. Over the years, many readers have been graciously engaged in a discussion about a topical matter, or asked for help to realise potential. And that has been wonderful, thank you. ​And, as you might expect, some entries have garnered high attention; others less so. Readers seem to prefer pragmatic guidance over provocations or calls to think more deeply about something. Recent examples of the former include writings on questions, chairmanship, and storytelling.
    Now, as we stand on the cusp of 2024, my hope is that Musings remains relevant and useful into the future. And with that, may I ask a favour? (Actually, provide an opportunity, to crowdsource Musings!) 
    What topics and style would ensure Musings remains relevant and useful as it moves into its teenage years? Do respond in the comments block below, or send me an email. And, thank you in advance.
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    Taking time to read and to think, to re-charge

    Accountability Decision Making Leadership Readings Tough Questions
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    Twice this week, I have been asked about my reading and thinking habits. One enquirer wanted to know much time I spend reading and pondering insights garnered from various authors; the other whether I schedule [slow] thinking time. 
    Although neither asked explicitly, both enquirers seemed to assume that quiet time and the notion of reading widely are important to me. And, indeed they are. But, why?
    The practice of reading serves, I think, two inherent objectives: to maintain currency with trends and developments, and to become a better person. The objective is not to become a technical expert capable of regurgitating data and ideas (ChatGPT can do that), but a more holistic thinker—one who discerns problems and opportunities, considers them from different perspectives, asks appropriate questions and draws relevant conclusions. More succinctly, someone who leads a reflective life.
    May I propose something? To philosophise is to breathe. In my experience, and that of others who I have been fortunate to interact with, the ideas that emerge from the practice of philosophising provide a solid foundation for that which follows. And yet many business leaders and board directors claim to be too busy to take time to ponder (think about) possibilities that might lie below the surface or around the corner. Quite why such a (seemingly) bedrock activity is neglected is a curiosity to me; high quality thinking is an antecedent of effective leadership and governance, n'cest ce-pas?
    When people I interact with, especially friends and clients, say they see a better me (someone who is on top of his game, is nice to be around and who offers relevant and considered advice), such observations tend to coincide with a period of reading literature (or other so-called 'brainy' books) and thinking deeply about the questions posed by the authors. While comments like this are gratifying, they serve a higher purpose: to remind me to make time, regardless of what else is going on around me.
    (And, in case you are wondering, my answers to the enquirers were, "About 12–15 hours each week" and, "Yes.")
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    Boards and ... mathematics?

    Corporate Governance Governance Phd Research Tough Questions
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    Diversity of thought has been widely promoted in recent times, as a mechanism to supposedly increase decision quality in boardrooms. Superficially, the idea of thinking differently is a positive evolutionary development from earlier efforts (think: women on boards) to break what is often described as the Old Boys' Club. That the discourse and intent has begun to move beyond appointing directors on the basis of physical attributes is helpful. And yet, the idea of 'diversity of thought' has long troubled me. 
    How does anyone know what I am thinking, or anyone else in the boardroom for that matter? And what is diversity in this context anyway—me having different thoughts, or several of us thinking differently? Crucially, what of any link to the board's work and purpose, which is to provide steerage and guidance to achieve a strategic goal? ​
    Researchers have published correlations based on specific datasets, but the general case (a reliable linkage between demographic diversity and organisational performance) remains elusive. The somewhat amorphous 'diversity of thought' is similarly afflicted. ​Recently, cognitive diversity (that is, different ways of processing information and approaching problems) has been suggested as a more reliable mechanism to achieve higher quality decisions and, by implication, outcomes. This sounds positive, but reliable explanations are yet to emerge. 
    Why is this so hard? Could the paucity of reliable explanations (of the relationship between board work and company performance) be due to researchers, directors' institutions and others trying to explain board work and develop 'best practice' models looking in the wrong place or using inappropriate tools? What if hypothetico-deductive techniques (in search of a deterministic best practice approach to some aspect of board work) are laid to one side and methods more common in social science used (critical realism or contingency theory, for example)? Should researchers embrace the idea that boards are social organisms, and that governance is a mechanism activated by the board?
    For the record, I employed critical realism, long-term observational techniques and contingency theory when researching boards a decade ago, as part of my doctoral research. The study was ground-breaking for it revealed new insights about board work including an explanatory framework. If you want to learn more about this study, check my thesis (academic-speak) or this article (plain-speak).
    In the past few weeks, I have picked up the question again (thanks to a wandering mind on long haul flights!), and have begun to wonder if fractals and chaos theory might offer a viable pathway to developing a theory of board work. Whether this might be a fruitful search or a blind alley remains unclear. Regardless, my mission is to help boards govern with impact, so the least I can do is dig further. And dig I shall.
    One request: If you know about fractals, or know of anyone who possess such expertise—especially in relation to social phenomena—could we schedule a call please? I'm starting from a pretty low base!
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    On writing well:

    Accountability Corporate Governance Decision Making Management Tough Questions
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    One of the great challenges for board directors and executive leaders concerns written expression. How might one cast vision, report progress clearly, make a request unambiguously, or argue a point convincingly if the key messages are not clearly stated? Directors and executives owe a duty to their colleagues in this matter, for written reports are the primary vehicle for sharing ideas, proposals and data before each board meeting. 
    To suggest the quality of the report (especially, the clarity of the message within) may be the difference between success and failure (that is, acceptance or rejection) is, probably, a truism. ​So, if we are to be convincing in our argumentation, we need to write well. But how?
    The first thing to acknowledge is that writing is a craft. And, as with any other craft, proficiency is something that emerges over time, as principles are learnt and applied in practice. Look to others who write well, and glean from them. Seek feedback from your readers too, and make adjustments. 
    I have long relied on the guidance of William Zinsser (1922–2015), especially that offered in On writing well​. Another great source is the Blue Book of Grammar and Punctuation, which provides specific instructions. How do you ensure board reports and business proposals are well written, and what tools and approaches do you use?