Dysfunctional boards aren’t that uncommon, but if you find yourself in the midst of a dysfunctional board you can be sure you’re experiencing headaches, either directly or indirectly.
Unfortunately, dysfunctional boards often lead to company and business failure. They struggle to make decisions and the decisions they do make often aren’t in the interests of the company and shareholders they are there to represent.
To make matters worse, board dysfunction can bleed out of the boardroom, through every conduit of the business and if left to fester will eventually become common knowledge to customers, competitors, and even to the broader public.
Board members have a fiducial responsibility to the company they represent and whilst that responsibility is generally taken very seriously by individual members, the level of dysfunction can inadvertently override that concern. But recognising the dysfunction provides an opportunity to begin to start sorting out some of the issues.
Ensuring The Confidentiality Of Board Meetings
There are some conversations a board must have and some hypotheses that must be tested, and often these conversations should never leave the boardroom. As a rule, nothing should ever leak out of the board, not to friends, employees, customers, competitors, press, etc. Information about the conversations a board is having can be easily misconstrued. Loose lips sink ships. The only thing that should leave the boardroom is what the board has agreed should leave.
If your employees know about the board discussions, you know you’ve got some dysfunction you need to deal with. If things are reaching your customers or the press something needs to be done pronto.
Dealing With Board Members’ Conflicting Agendas
Most board members get to their position of prominence because they’re experienced in creating a direction of travel and delivering on it. That means you’re going to have a group of fairly strong-willed individuals who all have their own agendas. Unfortunately, this can lead to conflict when those agendas intertwine with the direction of the company.
It’s not a bad thing for board members to have their own agendas. In fact, that’s how things get done. But those agendas can become distracting at best and at worse can become unhealthy fixations that threaten or override the goals and mission of a business.
Whilst it’s important board members are able to align their agendas with each other, it’s essential that board members’ agendas are well aligned to that of the lead executive otherwise deadlock will ensue.
Board members will often develop their own personal agendas over time and it’s important that these are discussed and where possible brought into the business’ objectives. Where the board member’s personal agenda is incompatible with the business’s objectives or where there is a conflict with the personal agenda of another board member this should be discussed and agreed it’s something that the board member should not pursue.
Keeping Order In Board Meetings
Most meetings require some kind of agenda just to keep them in order. Dysfunctional boards will jump from one issue to the next, they’ll argue, or worse still, they simply won’t discuss issues. To keep things in check it’s important to agree on a designated leader, who holds the agenda and for members of the board to give way to that person at the appropriate moment so as to keep meetings productive.
How To Deal With Boardroom Disdain
Board members will regularly experience some level of disdain for their colleagues on the board. Boards change over time, board members come and go, and board members develop or stagnate in their roles. Naturally, some people are more suited to a board role than others and sometimes a business will outgrow a board member.
Often a lack of respect for a CEO by board members (and vice versa) can be the keenest sign of a dysfunctional board, as is the factionalism within a board disdain can breed.
You’ll catch glimpses of this in terms of the way people react. Think disengagement, eye-rolling, dismissing ideas out of hand etc.
Encouraging board members to find common interests and work for the good of the organization is essential and it’s something that every board member should be focused on cultivating.
What To Do When A Boardroom Becomes Hostile
A boardroom isn’t always a collegiate and collaborative environment. In fact, on many occasions, the board will be a fairly hostile place to find yourself. Surrounded by strong-willed and straight-talking individuals – who themselves have risen through the rankings often by taking no prisoners – it’s important that you learn to stand your ground and work out how to work with your colleagues. But when two members of the board don’t get along or are openly hostile to each other the decision-making of the board can grid to a halt.
Unfortunately, the board can become an auditorium for personal attacks when individuals are struggling to get on. If one or more board members starts telling another member of the board how they react in certain situations or there’s a focus on past performance then you’ve got a problem. It’s important that the whole board addresses this issue with the individual or individuals who are having a disruptive impact.
What To Do If Board Members Start Meeting Outside The Boardroom
The board is the correct place for board members to make the legal and strategic decisions that affect a business, however, it’s easy for board members to circumvent the proper processes and begin to communicate and make decisions outside the boardroom. Often this happens in a spirit of alacrity and because board members work well together on a day-to-day basis. However, if decisions and communication are regularly removed from the board environment, it can breed mistrust and resentment, and lead to divergence and misalignment between the understanding of the direction the company is taking.
The board must address this and where decisions are being taken outside the boardroom, these must be brought back into the proper process. This can be especially difficult when the board members making the decisions in extra-boardroom meetings are the principal officers of the business.
What To Do When One Or More Board Members Dominate Board Meetings
Boards exist to work together to come up with the kinds of decisions that will benefit the long-term health of a business. However, in most boards, you find there are individuals who dominate the board room. This is especially true when the lead board member has the largest stake in the business or has been running the business by themselves for a long period of time.
Dominating members will use various techniques to get their own way. Sometimes this will be talking loudly or talking over other members, some board members will dominate by not letting others speak. There may even be harassment of other board members.
Whilst calling out a board member for their behaviour may seem like a good move, it’s generally not the most productive move in the boardroom as individuals may dig in. In these kinds of situations, it’s important that the individual chairing the meeting helps to calm the situation by ensuring all members have the appropriate time to speak and by moving the conversation along when things get bogged down.
What To Do When Board Members Don’t Participate In Meetings
Your board members might not always be able to attend a board meeting. They should send their apologies for their non-attendance, however, from time to time things unforeseen happen. In these situations, a company’s articles will make provision for non-attendance.
When one or more board members become a regular non-attendee of meetings it can speak of greater problems.
It’s important for the governance of the company that the board ascertains why there is non-attendance to see if there is anything that can be done to facilitate attendance, such as moving the meeting time or date.
If non-attendance takes place because a board member is just too busy or because they just wanted the prestige of a board appointment it may be best to suggest they consider their position on the board.
Conversely, you can have board members who regularly attend meetings but make little to no contributions to the meeting. For the sake of proper governance, it’s essential that all members of the board have a role to place in making decisions about the future of the business. Each member in the room who doesn’t contribute to the meeting is taking up the space of someone who may have something. Of course, they’ve been appointed for a reason and it may just be that they can be guided to contribute more. This can be especially true with new board members who should be appointed a mentor if they are struggling to find their voice in the meetings.
Don’t Let Boardroom Dysfunction Become Entrenched
The key thing to remember is to act when you realise there is some level of board dysfunction in your business. It’s important to address these things head-on in the boardroom environment and then come up with a way to address the issue.
Individuals may not have recognised their role in the dysfunction of the board and by pointing out the issues they have created, they may be able to address some of the issues themselves.
Other issues may be more structural and this is something the whole board can address to put in place processes and structures that facilitate a more harmonious boardroom environment.
You’re dealing with individuals and a structure here that will have operated in a certain manner for a long period of time and nothing will change overnight. Boardroom struggles are in no way rare or new. It happens and can be frustrating but stick with it. Make improvements and take the tough decisions. Do the best you can do for the company you represent, and find reward from your activity where you can.