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The Burden of the Board Chair

The Burden of the Chair

Apr 30

Here’s a riddle: If a company’s board of directors leads the organization, and the Chairman of the Board leads the board of directors, then is the Chairman the most powerful person in the organization?

Regardless of the Board Chair’s relationship to the CEO, every Chair holds certain foundational responsibilities hidden within seemingly straightforward duties, such as overseeing a Board Meeting. It is from these responsibilities and challenges that the Chair’s impact on the organization is ultimately revealed.

Working With the CEO

If the Board Chair is the CEO, this is obviously a simple task, except for the fact that they are torn between two responsibilities and do not have the benefit of delegating or getting advisement.

For all other Board Chairs, a good relationship with the CEO is critical to the success of any of the board’s initiatives. The board and will not commonly “go rogue” for that reason appoint the CEO. However, the CEO may not effectively communicate their needs or limitations or may be reluctant to follow the board’s lead. It’s important therefore that the CEO and Board Chair can trust each other and remain transparent. A good Board Chair will not only communicate effectively with CEO but will offer guidance and advisement that makes the CEO’s job easier. However, this endeavor can depend as much on the CEO as it does on the Board Chair.

Maximizing the Performance of Board Members

Board Chairs are responsible for enlisting members and getting them to work together. High performers are difficult to attract and retain, especially if the board members don’t receive compensation. If the Chair fails to bring in the right talent, she or he will be tempted to take on too much responsibility and the whole system will fail.

Not only do the members have to be individually successful, they must all work as a team with the Board Chair as their coach. The Board Chair must keep each member engaged in discussions and activities and ensure that they remain motivated. This requires ample communication, confidence in the member’s contributions, and little to no micro-management.

Navigating Disagreements with the Board

Sometimes the rest of the board will not follow the Board Chair’s lead. A good Board Chair will address the concerns directly with the members and continue to provide leadership. This may involve bringing in an intermediary or leaning on a policy devised for such situations.

Ultimately, the most important thing is that the Board Chair is fully transparent and receptive. The earlier in the process that the Board Chair can share information and their rationale, the easier it will be to gain the board’s trust or change direction.

Pleasing the Stakeholders

The Board Chair is usually the face of the board to all outside parties and is responsible to the organization’s stakeholders.

The first step in this process is to gain the confidence of the organization’s internal stakeholders. If the Board Chair can’t keep the internal stakeholders happy it is either because the organization is not running smoothly, or because the Board Chair lacks leadership skills. Without this success, the Board Chair stands little chance with the external stakeholders.

It is important that Chair remains transparent with all stakeholders, especially shareholders and the media. Even if the organization faces challenges, it is the openness, decisiveness, and quality of communication of the Board Chair that will set the tone and ultimately determine the results.

Providing the Right Direction

It is impossible for a Board Chair to intuit what the company needs. Success comes from a combination of advanced knowledge of the business, close communication with the CEO or staff, and advisement from the rest of the members of the board. Board Chairs that have not surrounded themselves with the right personnel are at a huge risk of failure: they are entirely dependent on their individual knowledge and are likely out of touch with the specifics of the organization.

The Highest Contribution

To return to our riddle, the board sets the direction of the organization and the Board Chair oversees all the activities of the board. This means that something as simple as running a board meeting is essential: the Board Chair sets all of the important topics for discussion and guides the whole board towards a decision that will be effective for the entire organization.

Therefore, even if the Board Chair doesn’t have the most individual power, the Chair has the highest responsibility as the foundational tool of the organization. From their contribution, all else follows.

 

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