Board self-governance is an issue that WomenCorporateDirectors (WCD) and Pearl Meyer explored in a recent report, The Visionary Board at Work: Developing a Culture of Leadership.
For this report, WCD and Pearl Meyer conducted in-depth interviews with more than two-dozen global directors, who formed our WCD Thought Leadership Commission, and conducted a survey of board members from US and multinational companies. A picture emerged of the typical processes by which boards currently evaluate and govern themselves and how, for some boards, this is shifting.
For most companies, the focus to date on board “health” has been on the board’s authority and how it functions. In recent years, boards have made great strides in formalising processes and defining “good governance” as it applies to their company and mission—a path influenced by stronger regulatory pressures and greater media and public scrutiny. But the next stage in the board’s evolution is a concentration on how board members interact among themselves and with management, and how those interactions influence decision-making…..As a normal course of regular business, many boards are adopting formal annual outreach campaigns with shareholders to discuss company strategy and compensation programmes. At the same time, some boards also solicit feedback on overall corporate governance matters as well as the shareholders’ view on the board’s effectiveness. By expanding the concept of “good governance” to one of good self-governance, boards today can inspire even greater confidence, and be on firmer footing for the tough decisions and disruptive times that are inevitable.