Curiosity is part of resilient governance
High-performing boards have high quality discussions. They share insights, challenge assumptions and explore new perspectives. Enabling their boards to have better discussions is one of the key ways company secretaries can make a greater impact. At a recent webinar, we looked at why it’s important for boards to be curious and what company secretaries can do to help them ask more insightful questions.
Asking questions that matter
Curiosity is a central part of directors’ role, says Annerly Squires, Senior Legal Counsel & Company Secretary at GrainCorp Limited.
“When they’re not curious, boards lose the opportunity to add value. It can lead to complacency and disengagement that affects both management and directors.”
Boards are looking more closely at purpose and value as well as overseeing performance. That includes considering how they contribute to the organisation, and how their organisation contributes to the wider community.
Melissa Jones, General Manager of Company Matters, Link Group’s specialist governance service, says conversations in the boardroom are shifting.
“Boards should be asking themselves how they intend to bring the stakeholder voice to the board table, what they can do to better understand broader stakeholder and community expectations, and how to enhance the company’s long-term value.”
It’s not just the number of questions that’s changing, but also how directors are asking them.
“Boards are asking more questions than ever, but they’re also much more conscious of the requests they’re making of management,” says Jones. “That hasn’t always been a consideration.”
How company secretaries can elevate their focus
As governance continues to evolve, company secretaries are increasingly important as trusted advisors. This positions them to influence boardroom discussions and contribute to better organisational outcomes.
Lack of time is often a significant barrier to company secretaries being able to fully step into the strategic aspects of their role. Digital solutions can make governance more efficient.
“Technology and processes are just so important to assist with the high volume, low value work, so you can really free up time to think about the bigger areas where you can have impact and add value in your engagement with the board,” says Squires.
Show, don’t tell
Board reports can bring issues to life, but nothing compares to seeing the business first-hand.
Company secretaries can facilitate this opportunity in a range of ways, connecting directors with operations, support functions, and the people who do the work.
Get out on site
Site visits are one of the most effective ways to share insights that go beyond the page and give directors a practical understanding about what goes on at the organisation.
“The board can go into the central part of the business and see for it themselves, talk to the people on the ground, look at the processes that are in place,” says Jones.
This equips directors to ask better questions, helps fill in gaps in their knowledge, and can address operational matters that are too detailed for the boardroom.
Going on site shouldn’t be a one-and-done exercise, either. Whether it’s an individual director, a committee or the whole board, visits are a powerful way to show employees that what they do is important to the highest levels of leadership.
Go down a level (or more)
Directors often don’t get the chance to engage with staff beyond the CEO and their direct reports who are a regular presence in board meetings.
Committees provide exposure to a handful of other executives and specialists, but interaction with people from across the business is generally rare.
Informal meetings where directors can have free-flowing conversations with staff from different levels and functions provide unique insights.
Bring it into the room
Directors don’t always have to leave the boardroom to experience the business from another angle.
Squires highlights that how information is presented can make a world of difference.
“Company secretaries play a really important role in being more dynamic in how information is presented to the board. Is there a product they can touch and feel? Is there a digital platform they haven’t experienced themselves?”
Bridge the (virtual) gap
Ongoing snap lockdowns and physical restrictions resulting from COVID-19 have meant many boards have had to delay site visits and other activities. However, there are alternatives that can help directors stay connected with the business.
Attending virtual town hall meetings are a way for directors to take the pulse of the organisation more directly than reviewing the latest survey results. Similarly, some organisations hold regular informal catch-ups online, such as a weekly morning tea.
Rather than receiving a presentation or making a speech, simply listening and observing can show authentic support.
Refine the agenda
Encouraging the board to be more curious doesn’t have to involve radically reshaping governance processes. It can be as simple as making small changes which help foster important discussions.
Slow down to focus on key issues
Going fast is fine if you want to go in a straight line, but to explore the twists and turns and look around you, it pays to move at a more comfortable pace.
It’s impossible to create an environment where curiosity can thrive when the meeting agenda is so tightly packed the chair is constantly having to move things along.
“It’s a constant challenge to have enough time in the meeting, but making space for strategic conversations and deep dives into particular issues is important,” says Jones.
Squires highlights that setting time to allow for reflection can lead to interesting insights that flow into future meetings or approaches for different matters, fuelling a positive cycle.
Plan the journey
It’s not only individual meeting agendas that are important. With boards facing an ever-expanding range of responsibilities and challenges, planning ahead is crucial to carve out time for meaningful discussion.
“Thinking through the annual calendar can identify where to fit in these discussions, and it doesn’t have to be in a formal board meeting,” says Jones.
“Some of the really great boards I have worked with have a lot of informal discussions. When you get to the board meetings it’s apparent that it strengthens the relationships between directors and management.”
Leaning into uncertainty to discuss issues before people have all the answers helps establish trust between the board and management team. That’s an essential part of creating a culture that supports curiosity and innovation.
Building a narrative that extends across meetings brings the board along with management as plans evolve. This enables directors to contribute to the process and management to adjust course along the way. It also avoids blindsiding the board with a last-minute approval request.
Support ongoing learning
Being curious helps directors stay informed in a changing environment and accelerate their professional development. It reduces the risk of doing what’s always been done when there may be better alternatives.
Make induction count
A common perspective is that it takes a year before new directors start adding value to the board. However, from day one, they can bring a fresh perspective that hasn’t been considered in the past.
Jones says that’s a key reason it’s important for new directors to feel comfortable to ask questions. A comprehensive induction program is part of the solution. Squires echoes this sentiment.
“Induction is often seen as something that’s quite short term, when it’s up to a 12 month process depending on the complexity of the business. Good induction is very important.”
The induction program sets the initial tone for how an organisation engages with directors. Does it show the big picture, establish key relationships, and invite ongoing dialogue? Or is it dominated by hefty documents and procedural detail?
Provide targeted training
Directors can add value through their experience as an executive and from across their portfolio of other appointments. But when it comes to continuing to develop their skills, they can find themselves left on their own.
Company secretaries can support the board with a tailored program that introduces new perspectives.
“Meeting with leaders from different industries and from around the world really encourages boards to consider diverse viewpoints,” says Jones.
“It can shift how they think about different issues, helping them be more open minded and embrace disruption.”
Look at board composition
Boards need the right mix of capabilities around the table to take their organisation into the future.
Last year, ASX-listed agribusiness GrainCorp demerged a significant part of its business, which also meant changes at board level and a new CEO.
Squires, its Company Secretary, says it’s prompted the now smaller board to review how it functions.
“It’s involved being very intentional about what it means to be a high-performing board and to consider the impact they have, and the legacy they want to leave.”
Regular board reviews are an important mechanism to enhance self-awareness and address the big questions about how they work more effectively. That’s important for all organisations, not just those experiencing major transformation.
Watch the Cultivating Curiosity – Reframing the Company Secretary’s Role webinar on-demand now.
Board Portal Buyer’s Guide
With the right Board Portal software, a board can improve corporate governance and efficiency while collaborating in a secure environment. With lots of board portal vendors to choose from, the whitepaper contains the most important questions to ask during your search, divided into five essential categories.
June 11, 2020
How to Build a Strong Governance Model
There has been a recent emphasis in the corporate world on best practices for corporate governance. The increased focus on governance has many boards of directors looking for ways to enhance their governance practices. Many of them are committed enough to the governance process that they’re allocating financial resources…
May 26, 2020
Governance in the age of COVID-19
The novel coronavirus (COVID-19) has thrown up serious challenges for businesses all over the world. The words pivot, change and uncertainty have had a work-out in the media, and struggling companies are relying on a stable financial system to underpin their economic recovery. The COVID-19 pandemic has put enormous pressure…
April 7, 2020
Best Practices for Conducting Remote Board Meetings
Remote meeting software revolutionised and modernised standard board meeting procedures. It was originally developed as a governance tool for businesses and organisations so they could arrange and discuss agenda items without incurring the time and expense of having to put a board meeting together at a physical location. Over time,…