Situation 01 / Governance
When the board becomes part of the problem.
Written by Tristan Roberts, Co-Managing Partner
A struggling business does not always have an operating problem. Sometimes the problem is sitting around the board table.
The situation
Performance is deteriorating.
Management says the board is interfering. Directors say management is not executing. Shareholders are frustrated. Decisions get revisited. Individual directors have separate conversations with executives. Nobody is quite sure where governance ends and management begins.
Meetings get longer.
Decisions get slower.
And while everyone debates who has authority, the business keeps moving in the wrong direction.
Board dysfunction rarely announces itself as board dysfunction. It usually presents as a strategy problem, a CEO problem, poor execution or simply “communication”.
Sometimes those problems are real.
But if management receives conflicting instructions, directors operate outside agreed governance channels, personal relationships influence commercial decisions or the board cannot agree on what needs to happen next, changing the strategy won't fix much.
What matters now
The first requirement is clarity.
- Who governs?
- Who manages?
- Who makes which decisions?
- What information does the board genuinely need?
- What are the five or six things that actually require attention now?
A business under pressure cannot afford several competing centres of authority.
What we would do
We would establish a clear picture of the situation quickly.
That can include:
- board and leadership interviews
- governance and delegation review
- decision-right mapping
- management reporting review
- financial and operating performance assessment
- identification of unresolved strategic decisions
- clarification of board, Chair, CEO and shareholder responsibilities
- establishment of an agreed operating cadence
Then we reduce the noise.
Clear priorities. Clear authority. Clear reporting. Clear accountability.
Sometimes the answer is better governance.
Sometimes it is leadership change.
Occasionally it is a different board.
The bigger lesson
A good board creates clarity when a business is under pressure.
A dysfunctional one multiplies the pressure.
And no turnaround plan survives for long if the people overseeing it cannot agree on who is actually in charge.
Relevant capabilities
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