Create a Stellar Board

• Date: 01 May 2018
• DOI: http://doi.org/10.1002/bl.30103
• Published date: 01 May 2018
• Author: Linda Henman

Create a Stellar Board

By Dr. Linda Henman

Dr. Linda Henman is the author of six books, including Tough Calls: How to Move

Beyond Indecision and Good Intentions. She has more than 35 years of experience

working with executives and boards in Fortune 500 companies and small

businesses to help them exceed their strategic objectives by maximizing talent. In

this article, she walks readers through the ve critical components of a successful,

high-performing board of directors.

In parts of Indonesia, Komodo drag-

ons make unwelcome and unan-

nounced visits to villages that border

their habitat. Even though the giant

lizards and humans lived in harmony

for generations, contention exists now.

Environmentalists have imposed new

policies in a region where people once

perceived a sacred duty for caring for

the Komodo dragons. The relationship

between lizard and human has not

been the same since.

Executives and boards of directors

have experienced a similar loss of sym-

biosis. Policies and procedures that

worked for decades don’t always work

when the economy, regulations, or

other significant factors change. Now

more than ever, directors are taking

their responsibilities seriously, speak-

ing up, and striving for results; but in

many cases, the evolving relationship

between the company’s executives

and the board has not found the right

symmetry. As we’re realizing, the real

challenge for directors and executives

isn’t regulatory compliance—it’s high

performance. To achieve it, directors

and executives need to systematically

examine the five constructs of a suc-

cessful Stellar Board.

Leadership

Thought leaders do not agree

about the best way to lead a board.

Some steadfastly hold to the notion

that the CEO and board chair should

be the same person. Others think the

board should split the roles.

Shareholder activists strongly sup-

port the idea that the chair and CEO

roles should remain separate. In their

estimation, both directors and the

CEO can be more effective when

the roles and duties of the chair dif-

fer from those of the chief executive.

Also, when different people hold these

roles, the chair can act as a lubricant

between directors and executives,

especially when inevitable conflict

occurs. However, although shareholder

activists maintain this position, in large

corporations, this happens less than 50

percent of the time.

Executives who interact with the

board have the leadership responsibil-

ity to keep the group focused on the

right issues. To do this, they need to

NUMBER 157, MAY–JUNE 2018

www.boardleadershipnewsletter.com

BOARD LEADERSHIP

INNOVATIVE APPROACHES TO GOVERNANCE

View this newsletter online at wileyonlinelibrary.com

Board Leadership • DOI: 10.1002/bl • May–June 2018

(continued on page 2)

ALSO IN THIS ISSUE

Governance SyStemS

and municipal GoverninG—

one city’S experience ............. 4

calendar of eventS ................ 6

NEWS

Study delves into corporate

secretaries’ view of directors

The Conference Board’s Gover-

nance Center has released a report

detailing the role and expectations

of corporate directors from the

perspective of corporate secre-

taries. Among the findings, the

center said, is that many corporate

secretaries are not convinced that

publicly disclosing formal board skill

matrices—a request some investors

are increasingly demanding—will

improve board composition and

functioning.

Other insights from the Just

What Is the Corporate Director’s

Job? report include:

•The most important facet of

directors’ interaction with

management is the information

they receive, analyze, and

respond to as they carry out

their oversight responsibilities.

Corporate secretaries who

participated voiced their

concern over asymmetric

information risk regarding

management’s communications

with directors and ways to

mitigate this inherent risk, the

report said.

•“Ruffling feathers” can have its

benefits, but directors must do

so with respect. Per the report,

corporate secretaries have

a unique position to assess

whether a board is too collegial

with directors, who often fear

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