Board dysfunction can be a tricky topic - most of us can identify it but how do we fix it ? At Resolve we have summarised the following main areas of dysfunction that we come across in our consulting work as follows:
Poor Communication:
Lack of open and honest communication among board members.
Failure to share important information or perspectives in a timely manner.
Miscommunication or misunderstandings regarding the organisation's purpose, values, vision or strategic priorities.
Conflict of Interest:
Failure to identify or appropriately manage conflicts of interest among board members.
Instances where personal interests or relationships unduly influence decision-making processes.
Lack of Diversity and Inclusion:
Insufficient diversity in board composition, including perspectives, age, gender and expertise.
Failure to actively promote diversity and inclusion in board recruitment and decision-making.
Ineffective Decision-Making:
Decision-making processes that are slow, cumbersome, or prone to deadlock.
Dominance of individual board members or cliques, leading to decisions that do not reflect the collective interests of the organisation.
Micromanagement vs. Oversight:
Board members who engage in micromanagement of operational matters, undermining management's authority and effectiveness.
Failure to strike the right balance between providing strategic oversight and allowing management the autonomy to execute day-to-day operations.
Lack of Accountability:
Absence of clear mechanisms for holding board members, management, and the organisation as a whole accountable for performance and outcomes.
Failure to address underperformance or ethical lapses in a timely and decisive manner.
Limited Engagement and Participation:
Board members who are disengaged or apathetic towards their responsibilities.
Unequal participation in board meetings or committees, leading to a lack of diversity in viewpoints and contributions.
Inadequate Succession Planning:
Failure to plan for board succession or adequately prepare new board members for their roles and responsibilities.
Lack of continuity and institutional memory due to frequent turnover or insufficient planning for leadership transitions.
Addressing these areas of dysfunction requires a commitment from board members to foster a culture of transparency, accountability, and continuous improvement. It often involves establishing clear expectations, promoting open communication, and regularly evaluating board performance and effectiveness. A number of peak bodies including the Australian Institute of Company Directors, Australian Charities and Not for Profit Commission and Christian Ministry Advancement have developed governance principles or standards that can help Board's grapple with moving from dysfunction to effectiveness. The following table summarises these principles and standards:
Resolve also works with boards to develop policy and processes that help promote governance effectiveness that are based on our Community Governance framework. You can purchase a copy of Community Governance from our store if you are interested.
And remember, every board member is responsible for a healthy, functioning board (not just the Chair and CEO). if your board has work to do - raise it at the next board meeting and suggest an external board appraisal or some board training.