Sydney Practice Leader, Geoff Curran, views Board and organisational performance as intrinsically linked.
“When Boards work effectively, it creates an operating environment with clear strategic direction and alignment; well-structured governance; strong decision making and communication and a positive culture,” he says. “These are all important dynamics that shape the overall performance of an organisation.”
Here Geoff shares six strategies for building a high performing Board that will lift the performance of your organisation.
1. Understanding the critical role of the Board Chair
The Chair has a critical role to play in driving performance and determining the effectiveness of the Board and executive leadership team.
“Choosing the right Chair and clearly defining this role has a profound impact on Board and organisational performance, as it is the Chair that holds the relationship with the senior leadership team – including the CEO or Managing Director,” he says. “When this relationship is defined by trust, honesty, integrity and a shared view on strategy and risk, it positively shapes culture, decision making and sets the tone and performance expectation at all levels.”
2. Achieving strategic alignment
Working towards organisational goals and a unified vision, requires clear direction and alignment. “The Board and executive leadership team must develop a shared understanding of strategic priorities; organisational culture and purpose; the governance and risk framework; and the plan for consistently delivering on these elements,” says Geoff.
3. Encouraging engagement
Working effectively as a Board means moving beyond a compliance mentality to focus on creating long-term value – but this can only happen when meaningful discussion and interaction takes place. “In any context, decision making is significantly enhanced by diversity of thought and perspective,” says Geoff. “To have real impact on the performance of an organisation, Boards must create an inclusive and engaging environment, where individuals are actively encouraged to participate and to interrogate business critical issues.”
While it’s important for viewpoints to be challenged, these discussions can often lead to conflict. “When the Chair effectively moderates difficult discussions or brings specialist facilitators in to do so, it creates a safe space for healthy discussion and allows different views to be heard,” Geoff continues.
4. Building a culture of accountability
A strong governance framework builds accountability and allows Boards to practice effective decision making; uphold ethical standards; deliver on agreed actions and proactively develop the required skills and capability.
To improve governance:
- Establish a formal structure with clearly defined roles
- Implement charters to set expectations for individual and collective conduct
- Develop effective communication channels and processes
- Regularly review individual and overall Board performance against agreed goals.
5. Focusing on continual improvement
Where a culture of continual improvement exists, Boards can grow from achieving compliance to providingtrue leadership and direction to the organisation. Achieving this requires a commitment to regularly reviewing the individual and collective skillset of the Board and applying a structured approach to addressing any gaps.
“Breadth of skill, experience and attributes shapes the impact that Boards can have. However, as the operating environment for many organisations is rapidly changing, it’s important not to become complacent about the skills that you have or what you actually need for the future,” says Geoff. “A comprehensive skills matrix is a valuable tool for helping Boards to understand and deliver on the current and future talent requirements; to guide strategic appointments and inform decision making for learning and development.”
To improve Board effectiveness, Geoff argues that sufficient rigour is also required. “The right structure and processes must be in place to measure collective impact and to fairly and objectively assess the performance of individual Board members,” he says.
6. Setting your Board up for success
To work effectively, there are some fundamentals to get right when Boards come together. To get the most out of your next Board meeting:
- Set a clear and focused agenda that aligns with strategic objectives
- Allow sufficient time for formalities and discussion
- Meet in an appropriate location, free from distraction
- Take accurate records and share them in a timely manner
- Agree on action items to progress Board initiatives
- Assign responsibility and hold individual members to account.
Gerard Daniels helps clients to perform in-depth assessments on Board and Executive effectiveness, delivered as part of executive search, succession and development processes. To better understand and improve the performance of your Board or ELT, connect with Geoff or reach out to your local Gerard Daniels team.
