To Make a Difference, Boards Need a Boardroom Revolution: Board Failures Spring Not from a Problem with People but with Process-And American Governance Specialist John Carver Has Updated His Prescription for a Cure. (Corporate Governance)
Jayne, Vicki, New Zealand Management
Policies that make a difference, missions that are clearly articulated, standards that are ethical and prudent, meetings and committees that work ... Got your attention yet?
These noble goals outlined on the flyleaf of a new edition of John Carver's book, Boards that make a Difference, remind me of those beautiful photos in recipe books. Nothing I cook ever looks like that!
And most boards don't look like that either--according to a chap who's got to know a heck of a lot of them. When Carver laments that few boards ever live up to their potential, are widely seen as bouncing from rubber stamping to meddling, and that the realities of group decision-making "forever resigns boards to be incompetent groups of competent people", it is criticism born both of familiarity and "love".
The book is written, he says, out of his "love affair" with boards and is both hopeful (results can be much better) and presumptuous (he beats up a few sacred cows such as undue focus on bean-counting activity). He concentrates more on non-profit and public organisation boards hence his descriptive title. However, much of what he has to offer is valid for private sector governance policy and approach.
The problem with most boards is that people join them with good intention, strong purpose and dreams of making a difference, but find themselves trapped in trivia, mired in seemingly purpose-free meetings and generally diverted by too much day-by-day detail.
As Carver puts it, the majority of what most boards do either does not need to be done, or is a waste of time if done by the board. Meanwhile, what they need to do for strategic leadership is not done. That, says Carver, signals "a major dysfunction in what's accepted as normal".
He believes boards are trapped in an inadequate job design--wrong-footed from the start into being reactive rather than proactive. His cure: get explicit about the big picture policy issues. What is the board's purpose in this world? Who is it there to serve? How can it best do that? What are the values and perspectives (the policies) that drive its activity?
It's the same recipe that values-led companies follow and is designed to state an organisation's essential raison d'etre and therefore provide a sound base for leadership that is strategic, decision-making that is coherent, and behaviour that is both consistent and purposeful.
While this book specifically focuses on boards of public and non-profit organisations--bodies that as Carver puts it also have to contend with "muted market" signals as to their performance--there's plenty of takeaway in it for board governance in general.
Having discovered on the job his own approach to governance which, as he says, "severely departed from much of conventional wisdom", Carver has become probably the world's most prolific author on the subject. And if he's hard on boards it's because a broad experience of their workings as a consultant has showed him how good they can be.
Governance, he says, is a unique form of management in several ways. Boards are at the end of the accountability chain (the buck has to stop there); they act in a moral and sometimes legal sense as agent of a largely unseen and often undecided principal (particularly those in the public/nonprofit arena); they're a set of individuals operating as a single entity; and they work at a remove from the organisation.
So, a unique job--but no template for doing it. It is an irony in management literature, says Carver, that where the opportunity for leadership is greatest, the job design for leadership is the poorest.
He advocates a new conceptual framework and demonstrates, both in principle and with specific examples, how it could work. It's been tested in practice and, he says, is capable, with tailoring, of fitting any type of organisation.
Carver starts off by detailing governance principles and why problem-based improvements tend to miss the mark. …