Strong board governance can be an elusive goal for an organization. Often a board member, staff member or stakeholder experiences the symptoms of ineffectual governance, but doesn't identify the cause as a governance issue.
These symptoms may include: feeling meetings are not well organized; spending each board meeting discussing similar issues with little progress from meeting to meeting; and lack of clarity on how board involvement impacts organizational effectiveness.
All of these scenarios are symptoms of weak or ineffectual board governance.
So what can you do to overcome board weaknesses or ineffectual boards?
Often the board lacks the knowledge or expertise to instill strong governance practices, but they can identify how this weakness is manifested in the day-to-day functioning of the board.
Whether you're forming a new board, or trying to re-start an existing board, good governance can be implemented if you focus on three areas: structure, management and oversight and accountability.
There are many tools and approaches to developing and implementing governance practices, but a focus on these three areas will set your organization on the right path.
Structure. The foundation of a good governance model is creating structure to foster and encourage governance. This framework establishes policies and procedures, rules of engagement, and sets expectations for all board participants. The necessary elements of structure will vary from board to board. They can range from conflict of interest policies to setting a meeting schedule and agenda to creating job descriptions for board members and statements of purpose for committees. High functioning boards incorporate governance into the very composition, purpose and function of the board which then becomes woven into its culture and philosophy. A clearly defined and communicated structure organizes the activities and actions of the board and its members. Often a board will create a board manual to capture the elements of structure. This manual can be presented during board orientation to new members as a training tool. It should be updated frequently and a copy given to each board member.
Management and Oversight. Another common shortcoming of governance centers on the roles and responsibilities of board members and management regarding the business or mission of the organization. Many boards do not clearly define the ways in which the board is responsible for managing the activities of the organization. The board's role is to provide the management team with the necessary oversight and management to drive organizational goals and outcomes. A board should be engaged at a high level of supervision, not in the day-to-day tactics. Organizations that fail to clearly define areas of responsibility and provide opportunities for supervision and feedback, risk failure and make it more difficult for board members to fulfill their fiduciary responsibility. Often boards and management teams develop a dashboard tool of value drivers and key metrics for the board to use for management and oversight.
A tool such as this provides a good starting point for discussion, evaluation and decision-making.
Accountability. Accountability is the third leg of the stool of strong board governance models. At the end of the day, if a board is not tracking what it is trying to accomplish and measuring its progress toward that goal then there is little purpose to the group. Accountability applies not only to the management team and determining whether or not that team is successfully accomplishing the business or mission of the organization. A healthy board will hold its members accountable in their role as well. Using strategic planning and self-assessment tools, a highly functioning board will spend time each year looking at its accomplishments, skills and contributions to determine how effective and efficiently it has worked.
The main benefits of good governance are control and transparency. It is through the establishment of clear roles, responsibilities, accountability and documentation of actions taken, that organizations will move forward and deliver increased value. It is never too late to evaluate board governance and instill best practices.
An assessment of each leg of the stool - structure, management/oversight and accountability - will provide a roadmap to address shortcomings and begin building a stronger governance model.
