Confidence at the Board Table

What’s in the Stewardship Mandate? 

A Board is a Steward.  It is supposed to secure the health of your organization.   It is supposed to ensure its mission is accomplishment.   

The Stewardship Mandate is the boards Job Description.  It is what the board is expected to accomplish in its role as agent for the owner.

Typically the board’s stewardship mandate directs the board to:

·         Ensure effective leadership for the organization

·         Ensure the organization’s mission, vision, and values are current, understood, and honored

·         Know the organization’s owners and stakeholders and understand the outcomes the they want to achieve

·         Ensure a strategic planning process is defined and active, and the board’s involvement in the process helps the leadership to achieve those outcomes

·         Ensure Board Bylaws and policies  are current and honored

·         Ensure the organization’s major processes are functioning effectively

·         Monitor management of opportunities and risks

·         Ensure the ‘general welfare’ of the organization is maintained

We emphasize the board’s asking the right questions, questions of  oversight, insight and foresight.

Oversight questions ask if the board is meeting the requirements of its stewardship mandate. “Are we meeting the expectations of our owners and stakeholders?”  “Is our financial situation clearly understood and sound?” “Do we have a robust strategic agenda?”  

We expect the CEO to report progress on these items.

Confidence at the Board Table

Enablers for the Right Questions

When you know what questions to ask you are more confident at the board table.  But your board needs three enablers to get you there. 

Effective Board Dynamics make board meetings a joy and participating in the discussion easy and non-threatening.  Board members bring a diversity of skills, experience, viewpoints, and gender, to any decision and make it more reliable.  Sound board dynamics allow each board member to add their ideas to the discussion, and listen to the ideas of others without prejudice.  Your personal contribution to the discussion is very important. 

Having the right information ensures that the board can understand the issues.  Boards need the right information, efficiently gathered, in the right form, prepared without prejudice, and easily read and understood in order to make the right decision.  Most of that information will come from management.  Thick reports are rarely “right.” 

A Focus on Substantive Issues ensures that board time is spent on issuers that are important to the board’s Stewardship Mandate.  A Board is a Steward, an agent of the owners appointed to secure the health of the organization and to ensure the accomplishment of its mission.   The Stewardship mandate defines the substantive issues on which the board should focus.

Good dynamics combined with the right information, focusing on substantive issues form the foundation for good governance.  Together they enable board members to ask the right questions and demonstrate Confidence at the Board Table. 

Next:  “What’s in the Stewardship Mandate?.”

Confidence how?

Confidence at the Board Table

Most Board Members want to make valuable and intelligent contributions to board discussions.  Most CEOs (Executive Directors) want to receive relevant and helpful advice and counsel from their boards. 

When Board Members know what questions to ask – and know how to ask them – confidence, competence, and informed decisions more readily emerge at the board table. 

What are the right questions?  They are questions of oversight, insight and foresight.

Oversight questions ask if the board is meeting the requirements of its stewardship mandate. “Are we meeting the expectations of our owners and stakeholders?”  “Is our financial situation clearly understood and sound?” “Do we have a robust strategic agenda?” 

Insight and foresight questions engage the board in the development of the strategic agenda.  When the board approves a strategic plan it “places a bet” that the CEO will make it work.

Insight and foresight questions draw Board Members’ knowledge and experience with past successes and failures into the discussion.  Coupled with management’s knowledge and experience the discussion is enriched, plans become stronger, and the strategic bet improved.   

Our “Questions” workshop helps directors learn to use past experience to ask the right questions.  It is part of our “Confidence at the Board Table Series.”

Next:  Enablers for “the right questions.”