Do you ever feel the calls from the boardroom to modernize, evolve its mandate, redefine its purpose, refresh its composition, motivate the management team - but nothing ever actually changes?
When it comes to making progress in boardrooms globally, there can be an insidious complacency that often prevents us from achieving real transformation.
Maybe your boardroom is the exception.
The truth is that true change demands courage – both on the level of the individual director and as a unified effort from all the players involved.
In this Savvy Director blog post, we’ll discuss how complicity through complacency can be found in many of today's boardrooms, and how savvy directors can safely advocate for meaningful change no matter the size or pedigree of the organization.
The word complacent is derived from the Latin word complacentem, which means pleasing.
Complicit means cooperating with others in a criminal or otherwise nefarious offense, cooperating with others in something that is morally wrong.
Rest assured, we’re not going to be discussing the extremes of criminality in our exploration of complicity through complacency in the boardroom.
But when you know an uncomfortable question needs to be asked about a situation facing the board, and no one picks up the baton, let me suggest complacency equals complicity.
This means that if you do not speak up on an unacceptable issue or situation, you are essentially condoning it. As is everyone else who sees it the same way you do.
We won’t take time today to think of every boardroom scenario you might find yourself in. It’s safe to say, you’ll know one when you see one. Often this kind of situation is behavioral, and dealing with people in a team dynamic makes it challenging.
These days, there’s a lot going on impacting boardrooms that are trying to catch up on initiatives put on hold during the COVID 19 period. If anything, COVID served to wake up a number of boards that may have become complacent in the years prior. All of a sudden director engagement became non-negotiable.
As boards return to their new normal operating models, some discussion starts to happen around diversity, Indigenous reconciliation, ESG, and other social topics. Although there are exceptions, these topics may not be lighting the fire under as many boards as you might think.
Complacency can happen both individually and collectively. Long tenure, lack of renewal, things going well over time, long term success, and low demand for diversity of perspective – all these factors can stifle curiosity, preventing the kind of questions that could jump start the strategic narrative toward a better future with refreshed expectations.
Maybe you’ve heard this objection before: “But it sounds like a lot of work to break in a director (who isn’t like one of us).”
Was it really said out loud? Probably not in the board meeting itself, but maybe it was said unofficially after the meeting.
Have you ever noticed how an entrenched director might say that a change initiative is a good idea, but nevertheless they put forward a series of (mostly bogus) concerns? Other directors might then jump in and agree. That’s resistance, pure and simple.
Who is going to call this out as Groupthink?
You can be the one – safely - if you combine relentless persistence with patience and carefully chosen tactics. All these are well within your Savvy Director toolbox.
Demonstrating courage is the sixth habit of the Savvy Director framework that we often talk about in this space. I’ve been amazed to witness courageous acts of governance skill from people you would least expect it from, and equally disappointed when it doesn’t seem to exist in others who should be stepping up to the plate to display board leadership.
What does a good approach look like?
It usually starts with a well-placed question at the right time for the right reasons. If your hunch is that others are thinking the same thing but reluctant to ask, you’re probably right.
But that’s not the reason for asking an insightful question. The purpose is to get the issue on the board table for discussion. Be patient. The deeper dive you’re hoping for might not happen immediately - it might be referred to a board committee first. That’s okay. It’s a key first step that means you’ve been able to get things moving. Kudos to you!
Before even posing your boardroom question, you could hold a pre-meeting discussion with another board member to confirm you’re on the right track. If you’re new to the board, this tactic will help increase your confidence, build support for your idea, and garner influence with someone who is closer to the center of power than you are.
If you’re the one who asked the question, embrace the opportunity to work on the issue personally. I’ve been able to exert a tremendous amount of soft influence over the years by being willing to lead an ad hoc working group, participate on a task force, or do whatever’s needed to bring forward recommendations on a key opportunity for the board’s review.
If you’re convinced complacency is no longer an option, think about getting involved, whether the issue is board renewal, board chair succession, DEI (diversity, equity and inclusion), HR policy, compensation philosophy, CEO succession, climate change, board evaluation, peer-to-peer evaluation, investment policy, risk management, or any other topic that you know is important.
Working on an issue outside of board meetings is also a great way to get to know your fellow directors on a deeper level by collaborating with others - another of the six habits of the Savvy Director.
Self-awareness is a good thing in the boardroom. Being able to recognize our own biases, leadership style, personal strengths, and opportunities for growth - all these are conducive to knowing where we can add value to the meeting and the board’s development.
There are resources at the end of this post that dive deeper, but for now, keep an eye out for the following ten signs you might be complacent:
Did you know term limits were originally invented because board directors were reluctant to have the difficult conversations with non-performing directors who were no longer adding value to the board? It’s true.
Is waiting out a low performing director in the best interests of the organization? What if board leadership is part of the complacency problem?
A 2020 PwC survey revealed over 49% of directors said there was at least one director on their board who needed to step down, and over 21% said there were two directors who need to move on.
Yet there are few articles written on how to ask a board member to resign. It’s complicated and reputations are involved. Get some confidential advice from your director network or governance advisor. See the Resources section at the end of the blog for suggested steps from experts (including follow-up paperwork.)
As a board chair, I’ve had to go for ‘a walk in the woods’ with a few directors to have the uncomfortable discussion about their future on the board. It’s never easy, but it must be done. The common reaction from fellow directors is often, “What took you so long?”
Perhaps you’re hesitant to raise a sensitive matter at a meeting because you’re not one of the board officers or committee chairs, or because there are long standing loyalties and reputations involved. What can you do in the meantime?
Try expressing interest in working with the governance committee or whatever subcommittee is tasked with board effectiveness. That committee’s mandate should include board evaluation, succession, and recruitment.
You can also be diplomatic and forthright with your views as part of confidential board evaluation surveys, peer-to-peer discussions, or discussions with an independent third party hired to do this work.
Again, what you really want to accomplish is to get the discussion going and surface the issues that have been buried far too long.
Get talking to each other as people.
Scott Baldwin is a certified corporate director (ICD.D) and co-founder of DirectorPrep.com – an online hub with hundreds of guideline questions and resources to help directors prepare for their board role.
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