FT BOARD DIRECTOR PROGRAMME NEWSLETTER

“A culture of respect and civility is of course beneficial to effective governance, but it shouldn’t prevent a board from bringing in new perspectives, challenging assumptions, and evolving its mix of skills to complement changing corporate strategy.”

A board operates as one entity; each board member brings their own unique experience and insight, but without a well-balanced group dynamic, the board will never fulfil its potential and truly deliver for the business. 

New research from PWC’s Annual Corporate Directors Survey highlights the importance of focusing on accountability and group dynamics in order to improve overall board performance. Over half (55%) of respondents said that ‘at least one fellow board member should be replaced, while 41% have a colleague who they believe ‘doesn’t contribute meaningfully to discussions.’ 

A good board should be more than the sum of its parts. But too much focus on legacy and maintaining the status quo can leave the group dynamics strained, with no one person wanting to be the first voice of change. There has been much debate recently over whether there should be stricter rules around how long board members, (chairs in particular) remain in their role. Long tenures can lead to diminished performance and a board that remains stagnant and resistant to change (34% of survey respondents identified this as an issue). 

Thorough board assessment seems to be one of the most important factors in solving this issue. According to the survey, a significant majority of respondents (87%) ‘don’t believe their board’s assessment process provides a complete picture of overall board performance.’ Without a thorough, honest process of analysis and assessment, not only will the board struggle to improve, but board members will lose confidence in each other and trust in the board as a whole.