4 Signs Your Board of Directors Needs a Culture Overhaul - Boardroom News & Insights

4 Signs Your Board of Directors Needs a Culture Overhaul

While culture is an afterthought in some boardrooms, members may not realize that it permeates everything they do. From the way they build relationships to whether members feel comfortable speaking up when something isn’t right:

  • Boardroom culture ultimately affects business decisions and is just as important as any topic discussed at the roundtable.
  • Board chairs and other members may not know how to build — or rebuild — culture in a way that brings about a more collaborative work environment and increased effectiveness.

With that, one key question follows — how can a board get comfortable tackling sensitive issues if mistrust and misaligned behaviors are allowed to fester? 

Your board needs to know that it doesn’t have to be this way. Addressing cultural problems early and directly, coupled with creating a process for repairing and rebuilding culture, can go a long way in restoring trust and ensuring the board is making the best decisions possible for the organization.

4 Cultural Issues Hindering Your Board’s Effectiveness 

It’s not worrisome if a few members of your board run into disagreements from time to time. Spirited discussions among a group of people who have differing viewpoints are not uncommon. However, when conversations and interactions start to break cultural expectations or jeopardize behavioral norms, it can affect the board’s ability to execute sound judgment and govern well. 

How do you know when it’s time to take action to stop boardroom breakdowns? Here are four cultural and behavioral issues your board needs to address right away.

1. Sidebar Conversations

Sidebar conversations aren’t always bad. They can allow for more questions than a meeting agenda can hold, give space for trading opinions, and help build healthy relationships between members. However, they can also be a source of inappropriate maneuvering and hidden alliances, and they can foster poor communication and board dysfunction.

Directors must address sidebar conversations that shut down diverse opinions, result in other members lacking critical information, or result in splintering or gossip. If these conversations are not brought to light, it hinders trust between board members and ultimately jeopardizes the decision-making process.

2. Heated Conflicts

Board members offering differing viewpoints or new information to consider isn’t true conflict. There’s nothing wrong with presenting a new perspective during a discussion.

However, if these discussions cross into the arena of disrespect or always seem to get heated, the situation may warrant further review.

When board members cannot contain their language or emotions, it’s usually because something deeper is at play. Perhaps it’s built-up resentment or mistrust. No matter what the problem is, it should be addressed immediately so everyone can return to honoring behavioral norms and feel comfortable adding to the discussion.

3. Disingenuous Cooperation 

Although heated conflicts should not be allowed to continue, all members should retain the right to debate issues and challenge the status quo. If everyone feels pressured to succumb to groupthink, that is just as serious a problem. It can lead to bad decisions and prolong the tenure of underperforming directors. 

4. Stale Agendas

While meeting agendas should include somewhat predictable topics, you should never allow them to become so routine that they no longer incorporate current topics that need input and discussion. Business environments change, and the board must discuss relevant issues going on in the company today. 

Additionally, avoid consistently packing meeting agendas so tight that there is no room for any real discussion. Not everything needs a debate, but most topics should be discussed so everyone is on the same page and members have an opportunity to share their opinions.

Rebuilding Your Board Culture From the Ground Up 

No board of directors is devoid of issues. Any group of humans trying to work together toward a common goal is likely to have some tension along the way. However, having a solid corporate culture is about knowing how to repair and rebuild when those tensions arise. 

The following actions can help your board create a solid framework for doing just that.

Define an Optimal Board Culture

Rebuilding your board culture requires:

  • Understanding where you are now and where you want to be in the future.
  • Brainstorming ideas for behavioral norms
  • Agreeing on about five to ten of those norms. 

Ensure that all norms listed support a clear delineation of:

  1. What authority belongs to the board
  2. The responsibilities that fall on management. 

As the business environment changes, commit to reassessing and refining the board culture you’ve outlined in this step. This will help you ensure your norms are aligned with your current organizational goals.

Reinforce Culture-Based Norms

Every board leader should play a role in reinforcing board culture. It’s important that you:

  1. Define those roles and ensure board members know what theirs are.
  2. Turn your attention to new board members by revamping your onboarding processes to ensure that each new director fully understands and integrates with the culture of your boardroom.
  3. Let board members know that they will be evaluated on both their performance and their behavior.
  4. Build this expectation into the overall board evaluation process and ensure individual directors receive feedback and an action plan when needed.

Adequately Address Behavioral Fault Lines

It’s important for the board to stay on top of any issues that could cause a major break or lead to serious conflict between members. This means immediately addressing any unhealthy group dynamics or behaviors from individuals — including problematic directors — that are not aligned with the culture. 

Make it clear to everyone that while reaching a consensus is preferable, rigorous debate is welcome as long as it remains respectful.

Also, debunk the myth that it is not okay for directors to leave their positions. Sometimes, tensions arise when directors who don’t want to be there feel that they would be letting the company, shareholders, or fellow board members down if they decide to off-board from their positions. 

Board Culture and Effectiveness Are Inextricably Linked

Boardroom culture is paramount to good governance. Everyone in your organization should feel comfortable sharing viewpoints and working together. However, sidebar conversations, heated conflict, disingenuous cooperation, and tight or stale agendas can hinder good collaboration and the establishment of trust. 

If you want to create a solid culture among board members, take the time to define and continually refine what that looks like. When you address cultural issues and hold board members accountable for their behavior, you’ll likely find that working together becomes much easier and your governance much more effective.

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