Crown Corporate Governance 2016
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Transcript of Crown Corporate Governance 2016
![Page 1: Crown Corporate Governance 2016](https://reader036.fdocuments.net/reader036/viewer/2022070520/58f147b11a28ab98688b45f3/html5/thumbnails/1.jpg)
Breakthrough Strategies ImprovingBOARDROOM
RELATIONSHIPS
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Boardroom relationships
are importantneed improving
Assumptions
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• 25 years of corporate governance focus Continued tweaking and refinement
Focus on structure and process More rules and regulation
Board performance issues persist Still focused on old issues and similar solutions
• Overlooked organizational risk Board / Management relationship
Premise / Hypothesis
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• Between Board members Conflicting understanding and expectations
Difficulty getting everyone on the same page
Reluctance to defer to the group
Complacency until crisis occurs Individualism
Challenge of group work / decision-making
Relationship Risk
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•Between Board & Management Sharing power and control Boardroom double standards
AttendancePreparationConductAccountabilityPerformance
Relationship Risk
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•Board / Management Conflicting loyalties
Mission vs. Minister vs. _____? Significant resources for intangible
returnReal value of your Board?Contribution to your organization’s success?
Relationship Risk
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• Systemic governance challenges Challenge of group work and decision-making Information ownership
Source of real power and control resides with Management
Inherent structural flaw Joining hierarchical and horizontal power
structures
Root Causes
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• Continued focus on structure & process Things to which rules can be applied• Preoccupation on governance inputs
Juggling regulations, best practices, guidelines
• Difficulty dealing with conflict Lack of sufficient trust, confidence, courage
How did we get here?
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TIME FOR NEW KINDS OF
BOADROOM CONVERSATIONS
T i m e l y i d e n t i fi c a t i o n a n d t a c k l i n g o f t h e t o u g h i s s u e s
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New Questions / A New Posture
Can the Board fully support status quo? If not, what needs to change?
BOARD’S OFTEN “LIVE” SOMEWHERE BETWEEN THESE QUESTIONS
The Way Forward
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• Different questions about board performance
• Proactively adopt governance practices• Apply practices with rigour
Traditional board evaluations/assessments focus on structure, process, compliance At best, superficial attention given to issues No real accountability to act; little impact Pro forma produces predictable results
The Way Forward
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From Inputs to Outcomes Governance outcomes in addition to traditional
structural and process inputs The Board’s impact as opposed to isolated
practices The Board’s value as a strategic asset; and, The Board’s tangible contribution to the
Corporation’s success
The Way Forward
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Other tactics (not strategies)… Commit to an explicit boardroom culture
Tenor and tone of meetings The way directors interact/work together Director behavioural requirements
Board and Committee Chairs defer to board needs
ACCOUNTABILITY MECHANISM
The Way Forward
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Clarity of accountability relationships• Candid, mission focused
consideration of:Minister to BoardBoard to MinisterBoard to ManagementManagement to Board
The Way Forward
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How are we going to work together?How are we going to share power and
control?How are we going to deal with conflict?
The Way Forward
Board/Management relationship
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The Way Forward
How Board & Management will govern well?
Stewardship Independence Transparency
Stakeholder rights
Accountability Oversight
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Critical Board QUESTIONSTHAT RARELY GET ASKED
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What does governance mean for your organization?
• Create common understanding about the primary role of the Board and what it
means to govern
Question #1
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What would be lost if the Board ceased
to exist?• Define the unique contribution the
Board makes; the value it brings
Question #2
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MANAGEMENT RESPONSIBILITIES
21
BOARD RESPONSIBILITIE
S
SHARED OR OVERLAPPING
RESPONSIBILITIES
Question #3: What is the Board 100% responsible for?
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What’s the working relationship between
the Board and the CEO/ED?
• how power will be shared• how the Board and CO / ED will work
together• how conflict will be addressed
Question #4
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What is the boardroom culture?
• How do we choose to go about or work?• How will Board members conduct themselves and
relate to each other?• What will the tenor and norm of meetings be?
Question #5
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Does the Board support the status quo without
reservation? Or, does something have to change?• What difficult issues is the Board
obligated to address?• What steps to get to resolution?
• Including mitigating risk
Question #6
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What issues are known but not being
addressed and resolved?
Elephants in the room Sacred cows
Question #7
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What double standards exist between the Board and Staff?
• What leadership inconsistencies/expectations?• What Board behaviours would not be tolerated
of Management?
Question #8
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What does the Board aspire to become?
• What does the Board want to be able to say is true about its value, contribution, etc.?
Final Question
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TD Canada Trust Centre55 King Street West, Suite 716
Kitchener, ON N2G 4W1T: 519-502-0409
W: www.boardgovernance.caE: [email protected]