Strong Boards are Built – Not Born
It is not unusual for many Board Directors to view their Board responsibilities as something they only give time to at the monthly meeting. Unless they participate in a committee or task group or volunteer to help with one of the organization’s activities, they are not likely to spend much time on their governance role.
Frankly, this isn’t surprising, especially when I observe how a large number of Boards operate and discover how little knowledge they have of what governing is and how to do it effectively. If a Board lacks a good understanding of good governance and does not have a culture that
fosters its importance to the success of the organization, then it is highly unlikely to attract and retain Directors who take the job seriously.
This issue came up clearly at a recent Board development workshop in which I informed participants that it was a requirement for Directors to be able to read and understand the organization’s financial statements. One of the Directors responded by telling me this was an unreasonable expectation and that it would make it difficult to recruit Directors. Several others in the room nodded in agreement.
I know this attitude is not unusual, but it is concerning.
On this Board, the legal requirement to be able to read and understand the financial statements was not a necessity for being a Director. This is failure to take governing seriously. It’s also a failure to fully understand what is required if the Board and its Directors are to govern effectively and fulfill their fiduciary obligations. This needs to change. Otherwise, why bother having a Board at all? CEOs can do the job quite well without them.
How to Move from Passive Oversight to Powerful Leadership
- Change needs to start at the top. Board leadership must take the first steps toward a culture of strong governance by:
- Empowering the Chair to lead a commitment to good governance;
- Learning and applying effective governance practices;
- Clarifying Director roles, responsibilities and how to fulfill them;
- Developing a shared vision for what good governance looks like; and
- Implementing a recruitment process that attracts experienced, governance-minded Directors.
Effective governance doesn’t happen by accident. Someone has to want to make it happen. It requires clarity of vision, an understanding of what it entails and a commitment from individuals who want to do the right thing!
Want to learn how your Board can take the next step toward great governance? Get in touch with us or check out our free resources on governance best practices and start building the Board your organization deserves.