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In the absence of the Dep Chair, who is best placed to resolve conflict between the Chairperson and the CEO?

If there are any indications of conflict between a Chair and CEO, the earlier it is recognised and dealt with, the better. Ideally, the Chair and CEO should deal with the conflict together. If they have not or cannot, it is typical for one of the most senior directors to help deal with the matter on behalf of other directors. The senior director can keep other directors updated on the progress made.

The Chair should also keep other directors clear on their perspectives and plans during an in-camera session (i.e. without the CEO in attendance).

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What is the significance of board independence?

Board independence is significant because it ensures that the board can provide objective oversight and make decisions that are in the best interest of the organisation, free from conflicts of interest. Independent directors bring an unbiased perspective and are less likely to be influenced by management or other stakeholders. This enhances the board’s ability to hold management accountable and make decisions that prioritize the long-term success of the organisation.

What are the challenges of board governance?

Challenges of board governance include managing conflicts of interest, ensuring diversity and inclusion, balancing short-term and long-term objectives and maintaining effective oversight without micromanaging. Boards also face challenges in adapting to changing regulatory environments, technological advancements and evolving stakeholder expectations. Continuous education and self-assessment are key to overcoming these challenges and ensuring effective governance.

How can boards improve decision-making processes?

Boards can improve decision-making processes by ensuring they have access to accurate and timely information, fostering open and constructive discussions and encouraging diverse viewpoints. Boards should also implement clear procedures for decision-making, including setting agendas in advance, defining criteria for decisions and documenting the rationale for decisions. Regular reviews of past decisions can help the board learn from experience and continuously improve its processes.

How does the board evaluate the CEO’s performance?

The board evaluates the CEO’s performance by setting clear performance goals and metrics at the beginning of the year and reviewing the CEO’s achievements against these targets. The evaluation process may include feedback from board members, senior management and sometimes external stakeholders. The board assesses the CEO’s leadership, decision-making and overall contribution to the organisation’s success. The results of the evaluation are used to determine compensation and development opportunities for the CEO.

What are the key components of a board effectiveness survey?

Key components of a board effectiveness survey include questions on board composition, meeting effectiveness, decision-making processes, leadership quality, director engagement and the board’s relationship with management. The survey may also assess the board’s understanding of the organisation’s strategy, its oversight of risk management and its adherence to governance best practices. These components help provide a comprehensive view of the board’s performance.

How can a board improve its governance practices?

A board can improve its governance practices by conducting regular assessments of its performance, staying informed about governance trends and best practices and seeking feedback from stakeholders. Continuous education and training for board members, as well as implementing the recommendations from board reviews and assessments, can also enhance governance effectiveness. Additionally, fostering a culture of open communication and collaboration among board members is crucial.

How does board governance impact corporate culture?

Board governance has a profound impact on corporate culture, as the board sets the tone for ethical behaviour, values and organisational priorities. Through its policies, leadership style and oversight, the board influences how employees and management approach their work and interact with stakeholders. A strong governance framework promotes a culture of integrity, accountability and commitment to the organisation’s mission.

How can a board avoid conflicts of interest?

A board can effectively manage conflicts of interest by establishing clear policies and procedures that mandate directors to disclose any potential conflicts, recuse themselves from discussions or decisions where a conflict arises, consistently prioritising the organisations best interests. Regular training on ethical behaviour and conflicts of interest can also help board members understand and adhere to these standards.

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