No CEO succeeds alone. Their team, their customers, their investors and many other stakeholders all contribute to a CEO’s wins. Among these many relationships, the one with their board of directors is the most symbiotic.
A CEO needs a board to share wisdom, serve as thought partners and provide objective oversight. The board, while providing ultimate accountability, very much needs the CEO as the primary leader and responsible party for success. The company’s success depends on a partnership rooted in collaboration and shared responsibilities.
No matter how functional, the relationship between the CEO and the board of directors can be complicated. Balancing strong opinions and establishing clarity around roles, vision, goals and strategy takes work. How do the board and the CEO establish a healthy, high-functioning relationship? We have worked with hundreds of boards and recently talked to some of the most experienced people in our networks. Here’s what they had to say...
Nothing is more important to a successful relationship. Transparency and mutual respect are foundational for healthy discussion. Honest recognition of everyone’s motivations, accompanied by a healthy discourse on priorities, builds trust and allows everyone to feel comfortable challenging one another. Good listening skills and a genuine commitment to thought partnership goes a long way in creating and maintaining the trust that is so critical to a working symbiotic relationship.
A common purpose is vital, but it’s just the starting point. The CEO and the board need to align on vision, strategy and goals – what they are and who sets them. Agreeing to a plan, establishing acceptable milestones and creating a culture of continuous improvement allows the CEO and board to get on the same page and stay there. Alignment also minimizes “negative surprises” and enables everyone to work together to meet goals, exceed expectations or adapt with course corrections when needed.
Stay Ahead of the Curve
Board members who stay current in their external awareness are especially valuable as thought partners to the CEO. Management has no choice in keeping its finger on the pulse of their business and the industry to anticipate potential disruptors. The half-life of information keeps getting shorter and, while board members might try to skate by, directors need to invest the time to stay in the know. CEOs can help by sharing the most salient sources of knowledge and multi-faceted viewpoints in between meetings, while not overloading the board’s reading list.
Practice Mutual Empathy
Appreciation for other perspectives can be invaluable. Leaning into empathy allows boards and CEOs to consider the range of perspectives on any given issue and is especially helpful in moments of challenge. The success of a major initiative, the possibility of disruption, the health and well-being of the team and numerous other factors can keep the CEO up at night. The board staying aware of what lurks beneath the surface can change the course of an outcome.
Plan for the Future
Succession planning is a non-negotiable mandate of boards and CEOs. Yet all too often, they kick the proverbial can down the road. CEOs and boards need to work hand-in-hand to plan for the organization’s future and bring along the next generation. This core responsibility presents the ultimate opportunity to collaborate. The board also needs to maintain a succession plan for itself, including the chair and committee chair roles.
Pursue Value Creation
Boards and CEOs have the luxury of being strategic, generative and long-term oriented when everything else is running smoothly. A business is able to run smoothly when there is a board/management relationship based on trust, clear alignment, informed and high-functioning collaboration and explicit open-mindedness. It’s incumbent on the board and CEO to work together to create this path to success: it’s the most assured way for everyone to win together.