Easy way to stop bad board behaviour
Bad behaviour can undermine the best governance framework.
Most chairs dread having to take a director to task over their behaviour. But it must be done for the board to have an impact and add value.
Here are five ideas for making it easier:
1 Set the standard before behaviour starts. Go beyond the ‘consent to act’ form and get a signed acknowledgement of a letter of appointment that sets out policies, standards of behaviour, expected time commitment, duty to manage conflicts of interest, etc.
2 Have a board code of conduct or behaviour policy. Get it out and review it at regular intervals to keep it current. Encourage staff to review and contribute also.
3 Act on the first transgression. Take the director aside and give immediate feedback. People will usually forgive one small transgression and the transgressor will usually recognise and correct the behaviour. Once behaviour has been accepted it is much harder to change.
4 Recognise and reward good behaviours. Small acknowledgements, given at the time of the behaviour will naturally encourage a repeat.
5 If someone doesn’t meet your standards remove them from the board. It may be difficult or embarrassing. It will be worth it!
Julie Garland McLellan is a consultant who works with boards and directors to give them the practical skills they need to build better businesses. She is famous for her practical and pragmatic approach to the real problems that face boards and directors and for her ability to bring sanity and solutions to even the most vexed boardroom.
She has first hand experience on 18 boards across three continents — including listed, private, government, and not-for-profit boards — and has helped boards to lead successful organisations for over 22 years. Julie has written and facilitated director education for leading governance institutions, including the Australian Institute of Company Directors, The Governance Institute of Australia, The National Association of Corporate Directors (USA), The Taiwan Corporate Governance Association, etc.
Julie is the author of six books for directors and is publisher of The Director’s Dilemma newsletter.