Maintaining a Healthy Board Culture: 4 Tips that Apply to All Companies

We hope your board is already impacting your company as a whole in a positive manner.

Perhaps your board meetings focus on sales, recruitment and projections for the next 10 years. But how often do you also consider how each person there—and the team as a whole—impacts the company you’re trying to lead?

The Importance of Board Culture

Many business leaders aren’t aware that what goes on when the board of directors meet, impacts the company’s culture as a whole.

As a quick recap, when we talk about ‘culture’ we’re referring to the business’ values, the customs everyone follows and the general way the team behaves. Your company has a culture, but your board culture also matters. If you aren’t happy with the ‘culture’ in your team, the root cause could be with your board.

Yes, in some companies the board is purely there to give guidance and prevent problems. This can lead to board members feeling a disconnect with the company as a whole. The truth is that board members’ actions determine the rest of the business’ behavior and culture. So, it’s imperative to keep board members engaged, informed about the vision of the business, and supportive of a healthy culture for the entire team.

Let’s discuss a few guidelines to help you manage board culture and to prevent many potential problems in future.

4 Tips to Manage Board Culture

Who do You Allow to Join Your Board?

Yes, you want a diverse group of people on your board, each bringing his or her own unique insight to the table. But you’ll find it difficult to create and communicate a clear picture of the culture you want your employees to follow, if new board members don’t agree with company values.

When the directors recruit new members, consider their skills, but also give attention to how the potential members will influence your culture. If how they operate in their current capacity is the opposite of your business’ values, don’t expect them to change their ways, simply to fit in with the board they’re joining.

Here’s an example: a new board member placed in charge of a project and who is known to enjoy ‘bending the law’ to benefit profits, may taint the company’s reputation. If your business values include ‘honesty’, this isn’t the type of individual you need on your board. It may benefit your bank account, but cause irreversible harm in other areas.

Be Honest: Do You Walk the Talk?

The board doesn’t always interact with the rest of the company’s employees, so you may think they don’t have to practice what they preach behind closed doors. However, it’s inevitable that the board’s culture will filter down to the employees and affect the culture in offices, factories, and in the field.

For example:

• Managers may talk to subordinates about working frugally and saving money, with ‘low wastage’ being a primary company value. But if the board’s culture leads to them deciding on expensive equipment the business doesn’t really need, employees will wonder why they should save if others get to spend.
• Your business plan says you want to minimize your carbon footprint, but board decisions don’t actively support recycling or only purchasing sustainable resources for manufacturing.

When this happens, employees lose faith in company values and they won’t align their own actions with them anymore.

Are You Honest with Each Other?

So, how do you ensure the board culture aligns with what you want your company want to represent?

For one thing, can you be 100% honest with each other?

A healthy board culture will allow members to challenge each other; not to attack the other person personally, but to fairly evaluate ideas. You need a balance between experiencing unity as a group and being direct with each other when discussing important matters.

In a culture where this honesty is welcomed, you’ll be able to help each other work to the advantage of the company, bringing the best out of each other.

Is it Time to Reassess the Board’s Role?

Some board members experience their roles as ‘simply maintaining balance’ in the company. When this happens, board members may grow dangerously bored. Dangerous, because when board members start questioning their roles or the use of board meetings, they begin to lose focus.

Keep your members involved and create a board culture of participation and creativity where everyone’s ideas are welcomed. You want your members to prepare for meetings, stay curious about where you’re headed, and dream with you about the best outcomes for the company.

Conclusion

Are you ready to take a hard look at yourself, the board members, and how you impact your business? Your next meeting may have to focus on your board culture, rather than simply paging through the financial statements.

Let’s help each other build companies with exceptional cultures that drive us towards our goals.