Seven Steps to Effective Pro Bono Boards
6 May 2014 at 10:07 am
The Founder and Managing Director of corporate governance company, Governance Matters, Kate Costello shares the seven steps she believes all pro bono boards need to take to be highly effective.
When an organisation performs badly it’s common for fingers to be pointed at management and in better times a board is often quick to receive praise for a job well done. In reality the board is ultimately responsible for balancing short and long-term organisational performance … and that’s just as applicable to the Not for Profit sector as it is to the corporate world.
As a keen observer of boards over some 25 years, I’ve pretty much seen it all and can assure you of one thing: there are certain attributes that are mandatory if boards – particularly those in the Not for Profit sector – are to succeed in protecting and nurturing an organisation’s culture and steering it on a path to sustainability and growth.
I call these the ‘Seven Steps to Success’.
Step one is the size of the board, which has traditionally been something of a battle for pro bono boards. They have tended to be larger – one case I encountered had a staggering 35 board members – as the organisations attempt to ensure that there’s a board representative for all of the many and divergent interests. Large boards are unwieldy and, empirical research tells us, they become inefficient when they exceed nine members, so keep them small.
It almost goes without saying, but I’ll say it: successful boards all have the right mix of skills. That’s Step two – get this right and you’re well on your way. Don’t become insular and look at how things have operated in the past; rather, be bold, imagine you have a blank sheet of paper and then populate it with people who bring together the balance of skills that align with your strategic needs. And, keep learning. But learning in a time-precious world is often easier said than done, which is why vehicles such as our new online board development subscription service, Board Minded, is viewed as a major boon for boards and board members keen to remain skilled in best practice governance.
The next key step is to choose your chair for ability, not longevity. All too often, the position of chair is seen as a reward for people who’ve been associated with the organisation for a long time.
When skills become secondary, success is compromised…and all the more so when choosing a chair as this position requires specific skills and should be filled by individuals amply displaying the talents demanded.
Step four deals with the effective allocation of board time and the message is simple: boards that set aside quality time to discuss strategy and consider the future invariably lead far more successful organisations than those who devote large chunks of meeting time to reviewing endless reports.
Yes, we need to know what’s happened, but we also need to find the time to place our gaze firmly on the future.
It’s one thing having strategic direction and strategic goals but these count for very little unless we’ve taken Step five and put in place systems to measure strategy outcomes. After all, we get what we measure, not what we expect, and strategic measures tell us how we’re tracking and what we’re achieving in line with our goals.
The penultimate step is to ensure that those who serve on our boards exhibit the right behaviour. We need people who are committed to the organisation’s values and who, when working as members of a team, display a functional rather than dysfunctional behavioural style.
Functional boards have challengers, those who may well hold a different view or position and will constantly challenge conventional thinking but do so in a manner where they’re looking for other, alternate ways of doing things and offering up solutions.
Dysfunctional boards have constant critics, those folk who want to ridicule, to bring everything down and to destroy rather than create … with nary a thought for solutions.
The final step towards board success is a clear understanding and acceptance of the dividing line between board matters and management matters. You’ll find in all good boards an absolute clarity between what needs to go to the board for decision. They’re spelled out in a ‘Matters reserved for the Board’ list and the inference is that if it’s not on the list, it’s a decision for management. In short, boards function best when there’s no misunderstanding, no grey areas and no stepping on toes.
In closing, if you can only take one of these seven steps, make sure it’s the greatest of them all – and that’s getting the right mix of skills on your board.
About the author: Kate Costello is the Founder and Managing Director of Governance Matters and has over 25 years experience in corporate governance and strategy consulting. She has worked closely with the boards of client organisations and has held many directorships. She was also a facilitator in the Company Directors’ Course, a comprehensive director program offered by the Australian Institute of Company Directors. Costello’s current board positions include directorships in ASX listed companies Integrated Research Ltd and LBT Innovations Ltd. She is also a director of Oncaidia Ltd.