The latest edition of the Australian Company Director magazine quotes a senior board chair describing how the role has evolved in recent years:
‘Where once the rule of thumb was that the chair did three times the work of a non-executive director (NED), they now do four times the work of NEDs, who in turn are working twice as hard as they used to.’
For the mathematically challenged, I think she’s saying that a board chair today has about eight times the typical workload an NED had, only a few years ago.
People unfamiliar with the role (to some extent, anyone who hasn’t been a chair) might ask what requires such a commitment. After all, they attend the same number of board meetings as all other directors, don’t they?
Over the last few years, I’ve developed a framework that I hope de-mystifies the role, outlines its breadth and demonstrates how critical it is to the success of both board and organisation.
My Five Roles of the Board Chair have resulted in a vaguely Scottish-sounding acronym – with a guttural absence of vowels – MCBSD (work in progress … it doesn’t quite roll off the tongue yet):
M – The first function, the one that everyone knows about, is Meetings: the Chair’s most obvious job is to plan and lead powerful Board meetings – meetings at which the Board makes the decisions that only the Board can make, where we tackle the difficult issues, where differing views are sought and tested, and when the Board and CEO agree at the end that the organisation is better off than when we sat down, when we know we’ve made the boat go faster.
Achieving this in our limited time together takes careful agenda planning and ensuring that we receive high quality briefing material in plenty of time. During the meeting, the Chair must remain alert to who’s speaking; who still needs to (and sometimes who needs not to); fresh ideas that might be emerging; what we still need to address; what we might be missing; and, finally, when we’re ready to make a decision.
C – The second job, that can take a lot of time, is managing the Board’s relationship with your only direct report, the Chief Executive. At its best, this can be one of the most satisfying parts of the role – developing and nurturing a strong working relationship based on trust, openness and respect (in both directions). The paradox is that it must not evolve into personal friendship: as Chair, you act on behalf of the full Board, not on your own account, and you need to keep that professional distance.
In contrast, if the relationship breaks down, or the Board begins to lose confidence in their CEO, managing this relationship may become challenging, time-consuming and immensely frustrating. If the relationship breaks down completely, one of you probably has to go: I can’t remember a broken relationship ever being fully rebuilt, and if the Chair and CEO can’t work together the organisation will suffer.
B – One of your biggest responsibilities as leader is to build and develop your Board. Some Chairs have the luxury of being able to select, or at least nominate, who joins you. In these cases you must resist the temptation to people who look and think like you, which may make for a more superficially collegial board. Instead, you need to think hard about the attributes that will add the greatest value, offer the best oversight and deepest insights, and find people who think differently (see my earlier post on Cognitive Diversity), so that the whole Board is greater than the sum of a few cosily-connected parts.
Where directors are appointed or elected by others (usually shareholders or members), I believe that the Board and Chair have a right – even a duty – to let them know what skills, experience and linkages might add the greatest value to the Board. They can choose to accept that advice, or not.
By whichever route your fellow directors arrive, as Chair you need to make the most of your team. You need to support their professional development as individuals and as a team; to ensure regular evaluation of board and individual performance; and to establish an appropriate committee structure with the best members on each; as well as planning for and managing the next round of succession.
S – Gone are the days of the invisible Board, or the Chair who appeared only for the AGM and set-piece media announcements. Today, our shareholders and stakeholders, external and internal, expect to know us, to hear from us and to be able to contact us if needed.
As Chair, I find huge value in getting to know the organisation on the ground, and in hearing from the people working in it. This is not about getting in the way of management – it’s vital that we don’t – but more about understanding what makes the organisation tick, and at the same time repeating the Board’s key messages, showing that we’re all heading in the same direction, and helping people to understand the valuable part each of them can play.
If you ‘dig the well before you need the water’, to build the trust and confidence of your shareholders and stakeholders, you’ll find it easier to have the tougher conversations when things aren’t going to plan or you see clouds on the horizon.
D – Finally, one important aspect of the job that I’ve seen several Chairs forget, especially when they’re new in the role: besides balancing your time with the tasks I’ve mentioned above, remember that you’re also one of the directors – not simply a facilitator or coach. You need to make sure you don’t dominate or cut discussions off too early, but you’re probably better informed than your colleagues, you still have a valid perspective, the right to ask questions, and even to admit you don’t understand.
Yes, ‘four times twice as much’ feels about right. It’s a big job. But if you want to make a real difference in your governance role, there’s no greater satisfaction than leading your Board through challenging times and seeing the value that you and your colleagues have added.
As someone said to me recently, ‘Your goal isn’t to live forever … it’s to build something that will.’
Good luck! And, if you need to talk about this, you know where to find me.
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