By Terrence N. Chimanya For a Board of Directors of any organisation to do its work effectively, it is necessary that all members understand their individual fiduciary roles and responsibilities and that the Board organises itself to perform the necessary tasks effectively. To achieve that feat, Board Committees or working groups are the answer. Through Board committees, work can be divided so that far more can be accomplished than if the entire Board acted on all matters. Board Committees, therefore, provide organisational structure and, at the same time, allow enough flexibility so the Board can adapt quickly to the changing demands of the environment and business. In my view, there are 4 crucial functions that Board Committees serve and such committees will be able to: Divide up the work of the organisation into management and targeted areas; Expedite work by removing routine tasks from monthly board consideration; Permit broader participation
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By Dr Edwin Nharirire When Boards are asked about the role of the Board of Directors in the attraction, deployment, development and retention of top executive talent, responses vary significantly. Research points to a relatively high positive correlation between best performing companies and their Boards’ involvement in executive talent conversations. Progressive companies should be concerned about the promotion of critical executive talent conversations at Board level, how boards can be effectively involved and share some executive talent metrics boards should be concerned with. Executive Talent The Board’s mandate to guide and give direction to the company portrays a helicopter’s view where they benefit from their vantage point and direct the efforts for the EXCO – ground troops executing the company strategy. In Executive talent, the Board can define the nature of talent that can take the company forward and in line with cultural aspirations. This oversight role involves the review of
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By Johnson Manyakara Ever heard of a public fuss about Board Remuneration? Yes, this is becoming a common occurrence. Stakeholders inside and outside the company now increasingly keep a close eye on Board Remuneration issues with virtually everything being scrutinised. If stakeholder interests are not met in the process, this often reduces confidence in the company and may result in serious reputational damage to the company. One may, therefore, ask, “How can Board Remuneration issues not keep Board members awake at night?” The “Hawks” And Their Interests “Hawks” are hovering around companies, both private and public, with a keen eye on ensuring their interests are met on Board Remuneration matters. Internally, the following are amongst the “hawks”, with their primary interests indicated: Employees (all levels)- real or perceived equity; Executive Directors- appropriate individual remuneration package perceived as “fair;” and Works Councils/Unions- real or perceived equity. In companies embracing the philosophy
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By Johnson Manyakara It is in the best interest of any progressive organisation to develop governance instruments to enhance the organisation’s ability to deliver against its mandate, whether the mandate is financial success or success in the provision of basic services such as water and sanitation, electricity, telecommunications, transportation, health or education. Governance Instruments, in my view, should keep Board members awake at night both in terms of having them in place and in terms of ensuring compliance with their provisions. Key Provisions of Governance Instruments Amongst the key provisions of governance instruments include the following: Full protection of all stakeholders; Accountability; Transparency; Responsiveness; Consensus Orientation; Equality and Inclusiveness; Effectiveness and Efficiency; and Participation. Examples of Governance Instruments in Board Leadership Research shows that the following are the most common governance instruments in Board Leadership: Board Code of Ethics/Conduct; Board Charter; Board Manual (e.g. Induction Manual, Governance Manual, CSO Self-Regulatory
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By Johnson Manyakara Many boards do a good job in terms of the appointment process of new Board members-identification, terms, reference checks, solvency checks, etc. However, most Boards don’t pay due regard to the all-important area of Board and Director Development, an area which helps optimise Board effectiveness quicker thereby drive an organisation’s success. Effective Organisations The most effective organisations invest in Board and Director Development in terms of continual learning and development. Amongst the strategic reasons for continual learning in the boardroom are the following: Board members are reminded of their role and responsibilities; The process helps build cohesive teams; Helps keep organisations safe and legal; Ensures Board members are using “reasonable care, skill and diligence” in the execution of their mandate; Helps motivate and retain good board members; and Helps increase innovation and improve overall Board performance. The Process Begins Here Best practice requires that new Boards and
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By Johnson Manyakara Corporate Strategy should also keep Board members awake at night. I expect a violent push-back on this, shouldn’t I? The likely source of the push-back is the majority of us still holding the traditional view that “CEOs should just get on with the job. A Board should merely choose and appoint a CEO, evaluate his/her performance and fire him/her, if he/she doesn’t deliver. Involvement by the Board in corporate strategy just confuses accountability.”-the role of the Board being restricted to approving next year’s budget and blessing the company’s long term plan. Please invite me to these “Blessing Ceremonies”! Missed Opportunity Aren’t Board members that hold that view missing an opportunity to guide the shaping of the business’ future through this rather “hands off” frame of mind? The majority of today’s Boards have people with loads of knowledge, experience, perspectives and contacts-assets that are not brought to bear
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By Johnson Manyakara Board Induction should keep Board Members awake at night! The sooner “best practice”-based Board Induction occurs, the quicker new directors are able to meaningfully and “productively” participate in boardroom discussions and decision making. The responsibility for the induction of new Board members falls squarely on the Board Chair’s lap, through the organisation’s Company secretary and CEO. Key Objectives The key objectives for new directors undergoing board induction include: Enlightening them on the purpose, vision, mission, core values and strategic objectives of the organisation; Enhancing the new directors’ knowledge, skills and experience to better equip them to discharge their corporate control and fiduciary duties; Improving the new directors’ level of confidence, competence and boardroom participation; Debunking wayward board leadership practices; Understanding the Board Leadership framework within which the Board operates; Addressing the expectations/requirements of the new directors to ensure they fulfil a meaningful role on the Board;
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By Johnson Manyakara This is the first in a series of blog posts exploring answers to this strategic question in Board Leadership – What should keep Board members awake at night? Progressive Board members have a number of issues that should keep them awake at night, starting with Board Leadership. But what is Board Leadership? Barbara Miller defines Board Leadership as- “…board actions that have served to move organisations forward so that they can successfully meet these challenges: Mobilise action to further the mission; Help the organisation adapt to changing circumstances; Respond to crises; Identify opportunities for change and growth, and/or Create future leaders.” In a way, planning for these actions should keep Board members awake at night. Key Role Boards and Directors have a key role in providing the leadership and accountability that determine the long term success of an organisation, accountable to shareholders. Effectiveness in this role depends,
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