Connie Collingsworth is an independent director at Banner Corporation and National Philanthropic Trust. She is also a former COO and CLO for the Bill & Melinda Gates Foundation. Here, she highlights the hallmarks of a great board and effective board meetings, and explains how embracing accountability can make boards more effective.
How can boards become more effective?
There is a tendency for boards to think their job is to hold management accountable. Whilst this is rightly their primary fiduciary duty, it means that they often overlook their responsibility to hold themselves to account. Dealing with board refreshment, collecting and implementing feedback, and asking questions appropriately when things don’t make sense are all important aspects of board governance and also important ways a board can hold itself accountable. In my experience, a board that proactively holds themselves accountable needs to become common practice so that boards can become more effective.
Unfortunately, as a host of surveys are telling us, this is not always standard practice. For example, board refreshment was around 7% in the US last year for public company boards; while at the same time over two-thirds of directors surveyed said there were directors on their board that should move on. This tells us that boards need to also focus on managing themselves instead of avoiding dealing with conflict or uncomfortable decisions.
“Boards need to also focus on managing themselves instead of avoiding dealing with conflict or uncomfortable decisions.”
In my experience, leveraging the benefits of diversity enables different perspectives from directors who may be more willing to appropriately raise questions or challenge the current way of doing things. A short while ago, I was speaking to an individual who leads a well-known private equity fund and as we were discussing this subject I heard an illustrative example from her experience as a young associate working on the Enron account. She recounted spending hours trying to make sense of their accounting practices and was beating herself up because they didn’t seem to make sense — she kept telling herself that her gut instinct must be wrong since the more senior individuals responsible were not asking similar questions. I worry this same dynamic extends to some boardrooms, where people look around the table and see smart, capable, and successful people who are not raising concerns, so they conclude they must be the one not getting it or that there are no reasons for concern.
The recent collapse of Silicon Valley Bank is a more current example, where it seems that with the benefit of hindsight, board members were not challenging management given that the business was experiencing rapid growth, despite the fact that there were clear warning signals that should have raised flags requiring action. Yes, it takes courage to speak out or challenge others when things don’t make sense, especially if your colleagues are not asking questions. However, you may be surprised to learn that there are often others who are asking themselves the same questions but are also hesitant to speak up. Stepping forward contributes to a culture of accountability and also creates opportunities for others to raise their concerns.
What are the attributes of an effective board meeting?
I have strong opinions about not simply being read to during meetings, which applied equally in my days as an executive. If you give me a pre-read, I will read it — you don’t need to read it to me again in the meeting as that wastes time and resources that can be better allocated for strategic discussion. Spending a board meeting watching polished slide decks can leave insufficient time for directors to ask questions as well as provide guidance. Unfortunately, traditional board meetings are often run in this fashion. Instead, the management team should present specific strategic questions or areas of concerns where the directors can provide their perspectives and insights from their depth of knowledge and experience, which is why they were recruited to join the board. Detailed reports are important to produce and receive, however, management should also receive succinct summaries that highlight the most important numbers as well as the trends. The board shouldn’t have to read between the lines or guess where their focus and input are needed.
“If you give me a pre-read, I will read it — you don’t need to read it to me again in the meeting as that wastes time and resources which can be better allocated for strategic discussion.”
One idea when presenting to a board is to frame the discussion with the specific questions management would like guidance on. It may be harder than reading through previously prepared slides, but it will unlock the full value of the board’s experience and insight.
How do you maintain a high level of focus on strategic direction?
Being clear about expectations and ensuring people are then held accountable to those expectations is one of the best ways to stay aligned. If you’ve got a crystal-clear strategy and everyone walks away from strategy sessions not only fully aware of those priorities but also how they will be held individually accountable, everyone starts rowing together in the same direction. Oftentimes, this isn’t necessarily the case – so making sure that your strategy and accountability mechanisms are clear is a key fundamental.
Other critical aspects of executing on strategic direction are prioritization and consistency. Individuals truly want to help an organization succeed in bringing its strategy to fruition. However, if the year starts with one set of priorities and then halfway through the year they are asked to take on additional different tasks, no one should be surprised when you get to the end of the year and you haven’t achieved what you set out to accomplish at the beginning. There are of course times when it is imperative to change course — however, it’s key that this occurs with intentionality and after deliberate thought, including a reprioritization of assigned tasks, which requires a lot of discipline.
“If the year starts with one set of priorities and then halfway through the year they are asked to take on additional different tasks, no one should be surprised when you get to the end of the year and you haven’t achieved what you set out to accomplish at the beginning.”
What book is on your bedside table?
And There Was Light: Abraham Lincoln and the American Struggle by John Meacham, which focuses on the US Civil War, as well as Lincoln’s journey through life. It’s a fascinating read, albeit quite dark and sobering.