In response to my post on CEOs waiting too long to address some of the key challenges in their role, Martin Birt posed an important question:
Where are boards in situations where CEOs have waited too long?
From the perspective of my coaching practice, it's rarely the case that a board is ignoring or discounting these issues, but there are a number of factors that make it difficult for them to play a more active role in resolving them.
Some of these delays typically precede or parallel the development of a formal board structure. Early-stage investors, observers and advisors may be more hands-off, or less experienced, or focused on other business-related issues. And even after a formal board structure has been established, with clarity on oversight responsibilities and a consistent cadence to meetings and communications, the CEO/board relationship is tremendously complex in ways that have a significant impact here.
CEOs want input--but they don’t want to invite meddling or appear indecisive. Financial and other incentives are often aligned--but not always. The information asymmetry in this relationship is large at first, and although it diminishes as the CEO and board members get to know each other and are able to speak more candidly, the stakes also get higher as the business grows, so there’s often some inherent tension.
In this context determining the board’s role on issues such as the CEO’s commitment to self-care, calendar management, termination practices, and establishment of management structures and routines is never easy to answer. Board interest in these issues could easily feel like intrusive micro-management. The CEO may not feel comfortable discussing these issues with board members. It's very hard work to create the conditions that are conducive to such difficult conversations, and not every board is able or willing to make the effort to do so.
An increasingly common response on the board’s part is to advise the CEO to work with a coach. (This is what happened to me, and I’ll always be thankful to Vince Stehle for giving me that friendly-but-firm push nearly 20 years ago.) But even such a recommendation can be interpreted by a CEO as a lack of faith in their abilities, so sometimes boards hold back out of a reluctance to undermine the CEO's confidence.
Some of the value of coaching for a CEO derives from the structural factors in the CEO/board relationship that preclude total transparency. Board members have fiduciary responsibilities that generally align with the CEO's interests--and not always. So the CEO needs a partner who has no investment in the business—this is essential in making it a safer environment.
But a theme in my practice is helping CEOs manage and improve their relationship with their board--the individual members and the body as a whole. The goal is to create an environment in which the CEO can share bigger, harder problems without worrying about the board's perception of them or triggering unhelpful activity on the board's part.
The key factor in this process is trust, and that can be extremely difficult to establish. At times it's simply not possible--sometimes incentives are fundamentally misaligned, and sometimes people truly aren’t trustworthy. But usually there's some opportunity to increase trust over time, although this requires:
- The development of a high-accountability, high empathy culture in which people can speak openly about problems and setbacks.
- A degree of comfort with vulnerability and sufficient psychological safety to make that possible.
- A willingness to assess the group's behavior and identify productive norms that contribute to the conditions above.
All of which is easy to write about, and very difficult to put into practice.
Photo by Nate Grigg.
