Boyden Executive Search

Board dynamics are changing as boards become more active. For CEOs, working effectively with this new breed may require new, more inclusive approaches.

Shareholders have become increasingly vocal, spurring many boards to eschew their traditional roles and get more involved with the business. Such hands-on “active boards” can be a major source of frustration for CEOs. But taking steps to work effectively with an active board should be high on any CEO’s agenda. Doing so can turn the board of directors into a valuable resource.

One approach is to establish more informal, one-on-one relationships with board members, especially the lead director and/or chair, and seek their input on key initiatives. This time investment yields more durable relationships as well as more productive boards. A personal connection can also provide a vehicle for addressing any issues before they reach a boiling point.

With the group as a whole, adopting less formal ways of communicating, and doing so more frequently, also improves relations. CEOs often engage with the board when there is a problem. This does not fit the new dynamic. An active board requires more substantive dialogue, with a more balanced array of topics up for discussion. This approach, according to Harvard Business Review, will “focus board activism on topics where the CEO will benefit from directors’ insight and counsel.”

Inclusion is another characteristic worth developing; specifically, bringing lower-level managers into the boardroom, rather than limiting board exposure only to the CEO’s direct reports. This invites opportunities to expand the discussion. Active boards are interested in the talent below the C-suite, and can be valuable in assessing the company’s most promising leadership talent. These individuals are driving operational performance, after all, and will in many cases lead the organisation in the future. Opening the door to them has the added benefit of talent development and retention.

Finally, better engagement with an active board of directors can be gained from allowing the board to participate in strategic planning early in the process. This does not mean handing over the reins. Rather, the CEO should keep decision-making in the hands of management, but give the board an advisory role at the outset. The timing here is pivotal, since this is when the big picture is formed. The particulars of the strategy can be left to the management team to decide and execute as they see fit – with the benefit of early buy-in and input from the board.

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