How a board should support a CEO

How a board should support a CEO: a helpful run-down of the most critical ways directors and chief executives can work together Your organisation’s governance depends on a robust and supportive relationship between the board and CEO. This critical link transforms corporate strategy from a boardroom document into active work. The CEO can implement it, the board can monitor it, and the CEO can provide oversight and guidance. So, from the outset, it’s evident that a board needs to support a CEO in this job. This guide will explore how to do it. What is the relationship between the board and CEO? The board of directors and the CEO have unique roles within a company. Still, both roles complement each other, and the relationship between them can make or break a company’s leadership. Simply put, the board is responsible for overseeing and approving major decisions regarding a company’s strategy. The CEO executes that strategy and provides management functions during day-to-day operations. The board evaluates the CEO’s performance in this area frequently and carefully. Meanwhile, the CEO and other management personnel provide feedback to the board on what’s going well, what isn’t, and any support required. How should a board support a CEO: A brief summary A supportive board communicates, provides and guides. As hands-off as the role of the director might seem compared to the CEO, the best boards adopt a hands-on mentality, not to take charge but to simply enable. When done right, this relationship allows the CEO to confidently execute their role, knowing they have the board's backing. However, they are still accountable to the board and must communicate progress and shortcomings in the context of the company’s strategy. Five specific ways a board can support a CEO Let’s drill down into the specifics. Here are five crucial ways a board can carry out its responsibilities to the CEO. 1. Provide clear strategic direction The board’s primary responsibility is to help set the company’s long-term strategic goals, which should be easy for the CEO and management to grasp from the outset. Crucially, though, they should serve as a reminder and a way for management to zoom out during day-to-day work. These are times when overarching priorities become hidden in the fog of day-to-day issues. When this happens, the board should ensure that CEOs have this ultimate guidance to fall back on. 2. Offer constructive feedback and performance reviews Many people, even directors, might find feedback difficult, especially when there are prominent areas for improvement. However, this is what makes an excellent relationship with CEOs. In high-stakes roles like this, feedback is the essential difference between success and failure. As a board member, you should ensure you provide your CEO with continuous, regular feedback, highlighting strengths and opportunities for improvement. Follow up with previous feedback, too; don’t just offer advice and then forget about it. 3. Foster open communication Boards that embrace open communication channels with their CEOs will foster a strong relationship. True communication goes beyond the simple offer of talking and feedback, it’s about ensuring your CEO feels comfortable sharing honest reports and seeking advice. The reverse is true too. Regular check-ins, formal meetings, and informal conversations can help build a culture of transparency and trust. 4. Provide access to resources A CEO needsa resources to implement strategy. They could come in the form of finance, human and increasingly technological assets as well. A good sign in strategic governance is that the board can provide when a CEO comes calling, this means that the strategy has been thought through, and the company is sure it has the tools to achieve it. 5. Support during crises or transitions In a crisis, professionals often rely on more senior staff for support. For CEOs, the only people more senior are the directors they report too, and directors should remember this crucial responsibility. Duris, such as economic downturns, re resourceshanges, or organisational transitions, the board’s support is more critical than ever. A strong board will offer guidance to the CEO, and communicate issues from management to stakeholders so that crises don’t seem as bad. The board will also ensure that the CEO feels supported in navigating difficult situations. What to do if there is a disconnect between the board and the CEO Whenever this happens, your action plan should include the following: Identify the source of the disconnect: Is the issue related to communication, strategy, or leadership style? Facilitate open dialogue: The board and CEO should engage in candid discussions to clarify misunderstandings and re-establish trust. If tensions are high, outside mediation or coaching may be necessary. Ensure your dealing with the core issue; if you wind up dicussing personal disagreements over core issues, you have a problem. Realign on strategic priorities: A formal strategy session can help bring the board and CEO back on the same page, ensuring they align on the company’s vision, mission, and objectives. While strategy may have been set for a long time, it can disappear in day-to-day operations. Consider leadership changes: If the disconnect cannot be resolved, the board may need to consider leadership changes. However, this should always be a last resort, as stability in leadership is critical for long-term success. In summary The board’s role in supporting the CEO is a delicate balance of communication, guidance and provision. Both parties need to act as enablers of each other. However, in the high-stakes world of corporate leadership, with ambitious personalities a lot of experience, this relationship can often come under strain. Being pro-active in support can ensure the relationship stays on track and fosters corporate success.

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Diploma in Corporate Governance

Certified Company Secretary Professional

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Technology & Governance for Boards

Company Secretary

Overview of Corporate Governance

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