Stanislav Shekshnia

<article-ideainbrief class="article-ideainbrief">
 <h4 class="ideainbrief-title">In Brief</h4>
 <div class="ideainbrief-contents">
  <h5>The Problem</h5>
  <p>Chairs often behave as if they are CEOs, creating conflict and confusion in the boardroom.</p>
  <h5>Why It Happens</h5>
  <p>The vast majority of chairs are former CEOs, used to operating as the boss.</p>
  <h5>The Solution</h5>
  <p>Chairs need to recognize that they are not commanders but facilitators. Their job is to enable the directors to have effective group discussions.</p>
 </div>
</article-ideainbrief><p>Most board chairs are experienced leaders. Half the chairs of the S&amp;P 500 double as their companies’ chief executives, and the vast majority of the rest are former CEOs. But the close association of the two positions creates problems. It’s difficult for a board led by the CEO to serve as a check on that CEO—which is precisely why, after the corporate scandals of the 1990s and early 2000s, more companies began separating the roles. However, that division can create another problem: When the chair is not the CEO, there’s a real danger that he or she will start acting as an alternative chief executive, sowing conflict and confusion among the firm’s top managers.</p>

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<p>The majority of board chairs are former CEOs, who are used to calling the shots and being stars. So it&#8217;s no surprise that many start behaving as if they are alternative chief executives of their firms. That sows conflict and confusion at the top. In addition, as research by INSEAD&#8217;s Corporate Governance Centre shows, the two jobs are distinctly different&#8212;and so are the skills needed in them. The chair leads the board, not the company, and that means being a facilitator of effective group discussions, not a team commander.</p>
<p>After surveying 200 board chairs and interviewing 140 chairs, directors, shareholders, and CEOs, INSEAD has distilled the requirements for the chair&#8217;s role down to eight principles: (1) Be the guide on the side; show restraint and leave room for others. (2) Practice teaming&#8212;not team building. (3) Own the prep work; a big part of the job is preparing the board&#8217;s agenda and briefings. (4) Take committees seriously; most of the board&#8217;s work is done in them. (5) Remain impartial. (6) Measure the board&#8217;s effectiveness by its inputs, not its outputs. (7) Don&#8217;t be the CEO&#8217;s boss. (8) Be a representative with shareholders, not a player. While many executives need to shift gears and mindsets to follow these, successful chairs say the effort pays off.</p>

How to Be a Good Board Chair

The majority of board chairs are former CEOs, who are used to calling the shots and being stars. So it’s no surprise that many start behaving as if they are alternative chief executives of their firms. That sows conflict and confusion at the top. In addition, as research by INSEAD’s Corporate Governance Centre shows, the two jobs are distinctly different—and so are the skills needed in them. The chair leads the board, not the company, and that means being a facilitator of effective group discussions, not a team commander. After surveying 200 board chairs and interviewing 140 chairs, directors, shareholders, and CEOs, INSEAD has distilled the requirements for the chair’s role down to eight principles: (1) Be the guide on the side; show restraint and leave room for others. (2) Practice teaming—not team building. (3) Own the prep work; a big part of the job is preparing the board’s agenda and briefings. (4) Take committees seriously; most of the board’s work is done in them. (5) Remain impartial. (6) Measure the board’s effectiveness by its inputs, not its outputs. (7) Don’t be the CEO’s boss. (8) Be a representative with shareholders, not a player. While many executives need to shift gears and mindsets to follow these, successful chairs say the effort pays off.

How to Be a Good Board Chair

Summary.

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