better boards conference 2015 the chair and ceo – when purpose and passion collide …. game on!...
TRANSCRIPT
Better Boards Conference 2015
The Chair and CEO – when purpose and passion collide …. game on!
Robert Gordon M Coun. GAICD. ICCG (INSEAD) CEO Board Accord
The financial crisis was as least as much a failure of BEHAVIOUR as a failure of Regulation.
- The Walker Review
Boards - People
“What distinguishes exemplary boards isn’t structural. Its social.
They have robust, effective social systems, with a virtuous cycle of respect, trust and candor”
- Sonnenfeld Harvard Business Review
Typical Labeling of CEO / Chair dispute
• Human Nature• Individuals are greedy, selfish, self-centred • EGOs / Narcissists / Psychopaths • Clash of strong characters• Irreconcilable differences• Chemistry• Hubris• Self Belief• Didn’t listen
INTRA-personal
Worldview• EQ - Recognise | Understand• Knowledge, skill sets, moral compass etc• Typologies | Developmental Science • Pathologies • Alignment Question –• Why am I sitting around this boardroom table?• What unconscious beliefs, values and assumptions do I need
to reflect upon and challenge?
INTER-personal
• Observable skills and competencies • EQ - Using | Managing• Typologies | Developmental Science• Communication - assertion and negotiation• Time, energy and resource management
Question – What behaviours do I need to modify to better enroll others in supporting our organisation?
The Cohort
Culture – “How we do things around here” to execute strategy and fulfill our mission.
• Integrity, Collegiality, Respect, Diversity, Collaboration
Question –
• Who is responsible for what? Roles and boundaries. Esp Strategy – development, implementation, oversight• The balance between alignment and disruption.
Systems We Work With and In
Internal Organisational Systems – Processes, procedures, protocolsQuestion –What organisational protocols do we need in place? Charters, BDRP
External Environmental Systems – Stakeholders, regulation, domainQuestion –How can we collaboratively agree on how to manage and negotiate External systems –
Volatility | Uncertainty | Complexity | Ambiguity to convert challenge and instability into OPPORTUNITY?
Support Vs Challenge Dilemma
Tension between -
Control Support (Agency Theory) (Stewardship Theory) antagonism excessive patience too adversarial too aligned
• Boards tend to escalate preferences for one mode.• Boards poor givers and CEOs poor receivers of Feedback.• Failure to manage that tension – a cycle of persistent and
strategic decline
Board - Cognitive Bias
Initial impressions (fundamental attribution error) of CEO -• Competence, Character and commitment• trust• openness• communication skill• receptivity to feedback • self-interest.
Favourable - confidence & support | CEO - co operation Unfavourable - concern & challenge | CEO - defensiveness
CEO Cognitive bias
CEO assesses and labels Chair and individual directors as • Competent/know all/egoist• Advisors who can/can’t be trusted• Risk averse• Resistant to change
CEO becomes defensive, ‘hard-of-hearing’ with a ‘controlling, critical’ board CEO Withholds information from ‘interfering board’ More hostility … more withdrawal and potentially vicious escalating cycle
Control and Support Traps
Control Trap – Too adversarial• CEO becomes defensive, • Mute button • Filters information• Discounts board
Support Trap – Too aligned • overate CEO• lack oversight• make excuses
l
Circuit breaker– Chair (Board)
• Avoid group think• Multiple sources of information• Encourage disruption• Chair as facilitator rather than ‘CEO/Chief Strategist’• Deliver feedback fairly, accurately, substantively, respectfully• Stay connected• Monitor ‘judgement’ consistently
Circuit Breaker- CEO
• One eye on the business and one eye on relationships• Watch for unconscious bias• Stress transparency• Frequently engage in discussion re –Roles, main concerns, stakeholders, key success factors• Listen, watch, do not withdraw
Externally Led CEO and Board Reviews
‘The performance of the board and key executives should be reviewed regularly against both quantitative and qualitative
outcomes’. -ASX Corporate Governance Council
‘Corporate Governance is an issue which ultimately has to be dealt with company by company, Board by Board, as each
individual board member steps up to the plate, or doesn’t’ - Walker Review
• Regular reviews mitigate against disunity• Serious intervention across every domain
Board Accord
Robert Gordon BEd. M Coun. GAICD. ICCG (INSEAD)Director of Programs
m 0405 541 [email protected]
www.boardaccord.com.au