Under-performing boards seem to abound
Is yours an under-performing board? According to a McKinsey survey, only 26% said their board’s performance was very good or excellent! (At public companies, their boards were rated excellent by 6% and very good by 25%.)
It seems that while the importance of these topics has been recognized, boards are not satisfied with the time they are spending on strategy, risk, and talent management.In fact, 44% of respondents said that their boards simply approve management’s proposals on strategy. Add this to the point made in the report that only 21% of directors claim a complete understanding of their company’s strategy. I don’t know about you, but this is not what I would expect from a quality board.
Oddly, the survey respondents said they want more and clearer direction from stakeholders. Doesn’t that sound like an excuse?
If directors are not happy with the time allocation, they need to speak up and make a change. If they are not educated in the business or the company’s strategy, they need to take the initiative and not sit back and hope somebody will do something about it for them.
Am I alone in reading this survey as indicating there are a lot of passive directors on boards?
What should be done? Comments welcome.
My thanks to Grant Purdy for sharing the link to the survey.