A healthy and productive relationship between the board and management is essential for good administration and organisational effectiveness. But this may become a real challenge.

In order to have a stable structure and an environment based on trust and respect, there is a crucial goal to be achieved: board and management should share the same vision and objectives. Closely follows the importance of a clear understanding of roles, delegations and boundaries, in which the board and management respect each other’s responsibilities, contributions and expectations. The key to a fruitful relationship depends on the open flow of relevant and prompt information in both directions.
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A lot of challenges arise from this complex relationship. Most of the times, board members expect management to accept that it’s their role to monitor and question, probe issues and offer insight based on their knowledge and experience.
On the other hand, directors spend most of their time on quarterly reports, audit reviews and budgets, instead of on matters crucial to the future prosperity and direction of the business. Therefore, a vision shift towards change is needed: directors should spend more of their time shaping an agenda for the future. They should engage in strategic discussions, form independent opinions and work closely with the executive team to ensure long-term goals are well implemented and met on time.

While adapting and implementing this approach, one key strategy for the board would be to have at least one person who has the responsibility to think as an activist investor. When no director is playing that role, many boards can be caught unaware. That is why, the foundations of a forward-looking board begin with a vigilant and energetic attitude, always weary of bad habits. A 360-degree vision, built on personal interviews, is generally a much better option than a continuous self-evaluation.

Winning boards will be those that look further out than anyone else in the company. In a world where people are connected 24/7, board and management team should understand the importance of an impeccable customer service. They should be able to see change as an opportunity and choose the best leveraging technologies that leap the business forward.They should pursue improvement on every meeting, while always keeping long-term strategies top of mind.
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