The Importance of a Great Board Culture: Part 2

Every organisation, regardless of its size, and whether or not it is a for profit concern, has its own unique set of rules, both written and unspoken, that create the protocols and establish the traditions, of how each member of the organisation expects others within it to act. Culture is the direct offspring of an organisation’s purpose, mission, goals and values, and the leadership of each organisation sets the tone and creates its culture.

Culture is more than an organisation’s mission statement, or a values statement that is written and published by its CEO and board of directors. It is also the actions of the board and other members of management and leadership that either support and substantiate these statements and policies, or undermine them.

While most of us tend to think of governance and oversight when we think of the roles and responsibilities of the board of directors, establishing and enforcing cultural norms is equally important. An organisation’s board of directors, Chair, and CEO are the creators, as well as the ultimate guardians and gatekeepers, of its culture.

The Benefits of a Great Corporate Culture

Culture driven companies gain several advantages over their competition, particularly in the areas of innovation, the ability to recruit and retain top talent, employee morale and engagement, and customer satisfaction.

Companies that focus on their values and their purpose, and that actively take steps to create a more humane workplace where associates have greater freedom, autonomy and authority reap a wide variety of benefits, including greater creativity, sustainable growth, lower costs, higher revenues, and higher profits.

A strong culture serves to unify groups of individuals who have different backgrounds, experiences and skill levels, helping them to increase their focus and marshal their efforts to work together in cooperation and collaboration towards common goals and objectives.

Efficiency is increased, as well as performance, providing greater value not only to employees, leadership and shareholders of the company, but to all stakeholders, including vendors, clients and customers, and the community at large.

Even in non-profit organisations, the ability to achieve goals and objectives, secure funding and achieve sustainable growth, as well as the ability to increase the level and number of services offered within the community, are all directly tied to the non-profit’s culture.

Changing Corporate Culture

Changing the culture within an organisation begins with its leadership. The CEO, board Chair, and board members are equally responsible for creating and communicating the organisation’s culture. Leaders that want to change the culture of their organisation, must first change the culture of their board and lead by example.

Leaders that want to increase the engagement, morale, collaboration and effectiveness of their organisations must first begin the hard work of changing board culture so that it models the actions, values, traits and behaviours that it wants and expects from the rest of the organisation.

Actions Speak Louder than Words

For example, if leaders are serious about increasing diversity and gender balance within their organisations, they must first show that these are goals and values that truly matter to the board. Mere words, policy announcements and press releases are not enough, but actions must match speech, beginning at the board level. If you want a more diverse, gender balanced organisation, the makeup of your board should match this value.

In a similar way, if you want to encourage greater autonomy, engagement, creativity, morale, collaboration and problem solving within your organisation, the board must first model this behaviour for the rest of the organisation. Actions speak louder than words.

Communication is Key to Changing and Improving Corporate and Board Culture

Increasing engagement and collaboration within your organisation as a whole begins with increasing communication and relationship building on the board. CEOs, board Chairs and allies for change from among the members of the existing board must work together and lead by example to move organisational boards and its members from static, passive positions to more independent and dynamic ones.

CEOs, Chairs and board members must develop and then use their bonds of mutual respect and trust to create open dialogue where significant issues are identified, researched, and discussed. The board’s agenda must be revamped so that the board transitions from a passive body that seeks recommendations to an active one that seeks diverse opinions and perspectives and looks for multiple options to solve key issues.

The strategic capacity of the board and individual board members must be developed and increased in order to improve decision making and learning processes that develop policies and best practices for the organisation.

As boards become more engaged, and their actions become more transparent, board culture improves, and directly influences corporate culture for the rest of the organisation.

Recognition and Other Rewards Reinforce Culture

In addition to creating and communicating cultural standards and norms, the board is also responsible for monitoring adherence to their culture. Boards can strengthen their corporate culture by taking steps to recognise and reward those who model the behaviours and standards that reflect the preferred culture.

Salary and bonuses tied to performance can go a long way in influencing the adoption of culture, other rewards such as publicly recognising those who model appropriate culture, and offering perks such as greater freedom and flexibility in the way that work is accomplished in the organisation, and even using the intentional design of the workspace to be more open and encouraging greater communication among colleagues, can also reinforce and strengthen culture.

Creating Greater Opportunities for Learning and Development Help Strengthen Great Culture

In addition to facilitating open dialogue and offering recognition and rewards to those who adhere to appropriate culture, boards and other leaders can strengthen great culture on both the board and throughout their organisation by offering more opportunities for learning and personal and professional development.

There is an old saying that a chain is only as strong as its weakest link, and this adage is very true when it comes to the performance and effectiveness of boards and their organisations. If you want a culture that supports growth and performance, you must give people the tools and training that they need to develop the skills that will support their expertise.

Skills that can be learned and developed are wide ranging and run from key leadership skills such as improving communication to skills that improve computer literacy and knowledge about cyber security and risk management.

As opportunities to learn and develop increase, leadership and other skills are developed and honed. This increases the performance and effectiveness of both the board and organisation as a whole. As individuals on the board and throughout the organisation grow and develop on personal and professional levels, both competency and morale are increased, improving co-operation, collaboration and adherence to cultural norms established and modelled by the board.

How strong is the culture of your board, and your organisation? Does everyone feel comfortable enough with one another to work together to tackle tough issues and truly debate and discuss key facts and possible solutions, or do factions, territorial behaviours and passive members continue to hold your board, and organisation, back from achieving its full potential?

Do you and your board need help creating a strategic plan for incremental cultural change, or, do you need help starting a true cultural revolution? Regardless of the level of change that your board and organisation need, we’re here to help you develop the skills and leadership attitude that you need to effect change and develop a strong board culture!

Phone 1300 719 665 or +61 424 447 616



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