Establishing the right board culture is key to board effectiveness. That culture is the accumulation of traditions and habits of work that have developed over time, through both written and unwritten rules that guide behavior. David A. Nadler, in “Building Better Boards” in Harvard Business Review (May 2004), defines culture as “powerful norms derived from shared values that influence behavior.” Or, as Herb Kelleher, former chief executive officer of Southwest Airlines, characterized it, culture is “what people do when no one is looking.”
A healthy board culture is an intangible but invaluable institutional asset, worth the same level of attention as building the endowment, recruiting the faculty, or maintaining the physical plant. Culture cannot be ignored or taken for granted. It requires careful consideration and nourishment from all members of the board, and especially from the board chair and the institution’s president.
Board culture is now more important than ever. Heightened public expectations of board involvement in public disclosures and other regulatory requirements are forcing new attention to the relationship between the board and the president and creating new tensions when it comes to boundaries between the board and the staff. That phenomenon is not confined to higher education or the nonprofit sector; Sarbanes-Oxley pressures are being felt everywhere, as the line between policy and operations is increasingly blurred.
An effective board culture is imperative in today’s environment. Higher education institutions face a series of complex problems that require sophisticated information sharing, data analytics, and board member expertise and experience to underpin discussions and recommendations for action. It is clear that the current model for higher education is in flux, and all colleges and universities are studying ways to improve educational delivery, reduce tuition costs, and secure higher rates of graduation and subsequent job placement for their students. Boards must now grapple with large issues that may impact the fundamental sustainability of their institutions.
Certainly there will be an evolving model of higher education; what is good for one institution may not be the solution for another’s problems. Opportunities will present themselves, and boards and staff will need to make decisions. But in all cases, board culture will either facilitate meaningful engagement and good decision making or it will hinder the ability of the board and administration to come to conclusions on strategic directions.
Indeed, many of the most visible board missteps in the last decade, both in and outside of higher education, emanate from inattention to board culture. Strong institutions can survive troubled boards for some period of time, but even the strongest institution will eventually be put at risk if the board is not functioning properly. Some of the common disruptors to a healthy board culture, ones that can be found among all types of boards, include:
- Dominant donors or other board members who make up a powerful inner circle and wield undue influence in discussions and decision making.
- Ideological or political factions that lead to a failure of dialogue and debate, and to the disenfranchisement of views. An example might be a public university system board of which the majority of board members were appointed by a prior governor from a different political party than the current governor. The new board members have opted out of participating in board work until, through further appointments by the current governor, they become the majority.
- Renegade trustees, who work in cliques or completely independently of other board members, pursuing their own agendas, whatever they might be. Some examples include pushing certain capital projects, improperly protecting the athletic director, or inappropriately forcing the president to resign.
- Micromanaging trustees who intrude into institutional operations, substituting their judgment for that of the president or staff members and ignoring institutional policies for consultation with the faculty. For instance, a board member might demand information about people or programs, without the support of the board for such a review and without working with the president to conduct the investigation.
- Disengaged trustees who do not read the board materials or participate in important debates, or who avoid committee assignments that require them to work with others.
- Board members who treat their board membership as a springboard for personal advancement.
- Board members who follow the agenda of the governor, the legislature, or a particular constituent without bringing such requests into normal board decision making.
- Skeptical and dismissive presidents who avoid certain members of the board, or even the whole board, and try to work without board involvement or decision making on key issues.
- Senior staff members—including board secretaries, members of the cabinet, or campus presidents inside public systems—who cultivate one or two board members to be protective of their interests.
How can these situations be avoided? The best board is fully informed about the challenges and opportunities in higher education; its members seek to stay current about newsworthy events and trends through regular reading and attendance at conferences on educational change. The board also uses select board plenary sessions for information sharing and expert guidance so it can most effectively tackle institutional challenges and move the situation forward.
The board committee structure and task forces on important initiatives can encourage the sharing of information and produce the most appropriate recommendations for acceptance by the entire board. A strong committee culture where dialogue is facilitated, one that engages the best minds of the members and invited experts, is vital for effective board governance—including oversight of current operations and issues, as well as future strategies, policies, and practices.
Observations from a Chair about Working with a New President on Culture
The tone for a board is set at the top. A chair of one institution that the commission heard from told us, “Beyond the obvious expectation about uniform support between the president and me for the institution and the mission, our board introduced several concepts concerning itself that became vital attributes of our evolved culture.” The chair noted that those attributes were:
- If you were on this board, it was to be your most important nonprofit endeavor in terms of time and resources. Period. This was discussed with prospective members before appointment.
- There would be total transparency at the top. The president told the board at our first meeting, “I want my problems to be your problems.” In return, we expected full attention, responsiveness, and confidentiality.
- We changed the dynamics of the meetings. All serious work was overseen by our standing committees, which met between scheduled board meetings. That had several intended effects: Trivial issues are no longer raised at either the committee or board level, and we’ve had a much better sense of inclusion because each board member has been involved in key committee decisions. (Many college and university boards are so large that giving every member a sense of inclusion and hands-on involvement does not just “happen.”) That has allowed us to spend our eight hours of board time dealing with real strategic issues.
“The key to making all this work has been careful planning of board time—which itself takes time,” the chair concluded. “In exchange, we have asked that every trustee come to board meetings having read and digested materials ahead of time. Board attendance (one of our dashboard of metrics for board evaluation) has increased appreciably.”
Healthy boards that operate effectively inculcate certain other ways of operating within their cultures, including:
Strong board-presidential relationships. The tone that is set at the top through board-presidential interactions is key to a healthy board culture. The board and the president should act as a team, with total transparency between the president and the board chair. They should have a good understanding of their roles and relationships, and work through inevitable tensions over the boundaries between the board and management when they arise. (See this article that explores this topic in depth.)
Solid relationships among all senior administrators and board members. Although the relationship between the chair and the president is particularly important, the president also needs to cultivate a working relationship with all members of the board—not just with the chair or one or two board members. The president should also set expectations regarding how senior staff members interact with board members, both to encourage such exchanges and also to avoid inappropriate end runs by the staff around either the president or the rest of the board.
Positive modeling of behaviors within the board, with staff, and with other constituencies. Board leaders should model the behaviors that they expect of all members of the board: respectful engagement, careful listening, robust discussion, and decision making that invites dissent and encourages inquisitiveness. The modeling of the behavior required of board members extends to presidents and senior staff.
Good internal board interactions and boundaries. All members of the board should be valued and expected to contribute, from the most junior members to the most experienced. The board as a whole should guard against cronyism or cliques and be careful not to let “insiders” assert excessive control over major elements of the board’s agenda.
Productive engagement and collective learning. Good governance requires boards to be engaged, informed, and thoughtful leaders. Individual board members must be willing and able to commit adequate time and mental energy to their board work. Boards should also make sure that the committees and the entire board spend time on topics that matter, not just the typical profit-and-loss statements that trustees often concentrate on.
For instance, committees should tackle issues such as institutional risk management (educational, reputational, financial), e-learning and new education distribution models, new methods of learning, the alignment of course offerings with student interests, and the expansion into new areas of learning through an intentional focus on innovation. Each board must chart its own course, but the committee structure should reflect the future, not the past, and should be helpful and supportive to administrators and faculty members who want to move in new directions.
Shared understanding of communication protocols. Such an understanding ensures that the board and president can maintain confidentiality about difficult issues. Presidents who cannot trust their board members to maintain appropriate confidences will start to avoid bringing sensitive issues to the board. That is true for both public and private institutions, although board privacy is more difficult to enforce in public institutions, given open meetings laws.
Talent development and continuing education. The board should make sure that it cultivates expertise and leadership among its members—thus guarding against gaps in knowledge and skills as members rotate on and off the board. New board members should be mentored and given appropriate board training at the time of their appointment. All board members should be encouraged to take advantage of opportunities for continuing education—including learning about trends that affect higher education as a whole, so that they may be better informed about the social, economic, and political context within which their particular institution operates.
Case in Point: How One Public University Board Improved Its Culture
In the past decade, the board of a public university has taken a number of steps to improve its culture. It has established a standing board committee on governance, charged with the dual responsibilities of: 1) board effectiveness, including the board’s structure, behavior, expectations, evidence of involvement, self-policing of its behavior, and self-assessment, and 2) talent development and compensation for the CEO and senior leadership.
The committee has developed a written statement of expectations about board behaviors and responsibilities that all board members now receive as one facet of a comprehensive approach to board orientation and continuing education. The committee members also consider the balance of talent needed among board members and have developed and continually refresh the criteria and attributes they are seeking in future appointments. Those criteria and attributes have been shared with the governor, and both the current and previous governors have taken them into consideration when making board appointments. The current governor uses them in his interviews with prospective appointees, and the board itself uses them to interview potential members before their appointment.
The committee also conducts annual evaluations of the board, including periodically engaging an external consultant and gathering input from senior institutional leadership as to their perceptions of the board and its effectiveness.
How to Create and Support a Healthy Culture
A board can create and sustain a healthy culture by putting in place certain procedures and practices, such as:
- A statement of mutual expectations for board behavior. Integrity requires self-discipline and self-regulation by a board, which, in turn, probably necessitates some statement of mutual expectations. A board should establish a climate of mutual trust and respect, as well as a mechanism to elicit, entertain, and honor divergent points of view. All board and committee chairs need to understand how to manage discussions to ensure the involvement of all members. Rules governing confidentiality and privacy should be well understood and adhered to.
- Systematic reviews of the effectiveness of the board, committees, and individual trustees (at least on the occasion of reappointment). Boards should engage in regular evaluations, including self-evaluations, and also periodically give senior staff members and other important constituents the chance to comment on the board’s performance.
- Well-managed committee structures and agendas. The goals should be to engage all board members and to protect board time for strategic work. Collegiality requires broad distribution of power, influence, and opportunities for leadership—along with deliberate efforts to cultivate social capital among trustees and between trustees and administrators.
- An effective process for trustee selection. It’s crucial for boards to recruit people with the right combination of expertise and knowledge, as well as with the personal attributes to make them good members of a board. A board, whether a self-perpetuating private one or a public one, should have processes for identifying desired skills and other attributes for future members. Those skills and attributes should be communicated to relevant decision makers before they begin the recruitment of new board members.
- A robust orientation program. All boards should have a regular process to orient new members. That process should include paying attention to some of the “softer” aspects of effective board membership, such as how a trustee is expected to behave both inside the boardroom and in public settings. Board orientation should also include information that helps members put their institution into context in ways that are relevant to their experiences in other types of organizations. Additionally, it should cover those aspects of higher education that differ from what many board members may be familiar with. Some of those aspects include the dispersed authority structure and the expectation for consultative decision making, different notions of the timeline around change, and risk management—including competitive threats and how they manifest themselves in a college or university. Orientation is vital not just for the education and introduction of new members, but also as a vehicle to establish the tone and culture of the entire board and its deliberations. One institution, for example, provides mentors for new board members and tries to rotate them. That way, each member attends orientation every few years and is reminded of the key factors that drive the board’s culture. The goal is not to lull board members into a passive acceptance of the aspects of an institution’s culture that they may find problematic, but to enable them to be effective in setting new strategic directions.
- Continuing education. Boards should organize periodic retreats and small sub-sessions that provide further information to their members. They should also support an individual trustee’s participation in continuing professional development through membership in organizations like AGB and attendance at its meetings.
- Mechanisms for self-discipline. The board should have processes to deal with problematic behavior and, occasionally, problem trustees. The goal should be to improve the constructive engagement of board members and the overall performance of the board. That said, if an individual’s behavior does not improve and becomes deleterious to the functioning of the board, procedures should be in place, when possible, for his or her removal.
In conclusion, the impact a board can have on the future of the institution is highly dependent on the board culture. A positive, forward-thinking, highly interactive, and generative board can bring change to an institution at this time when higher education institutions are at significant risk without change. How the board is organized and its membership characteristics, its allegiance to the students and the sustainability of the institution, and its shared values about engagement are all crucial to the board itself and the college or university it serves. A healthy board can provide the expertise needed to help solve the tough problems that institutions are increasingly facing today and will continue to face in the future. A healthy board will have the optimism to imagine the future as different from the past and help create educational outcomes that serve not only each graduate, but also the larger society, and indeed the world.
How Healthy Is Your Board’s Culture?
Boards should perform their own culture “health check” by asking questions like the following of themselves:
- Are all board members engaged in discussions?
- Is the discourse at the appropriate level of oversight?
- Is it a lively conversation, one that allows for discussion and dissent once a recommendation or motion is on the table?
- Is there a tolerance for tough questions that committee members may think they have resolved but that other board members need to ask?
- Are members able to reach a conclusive decision, with naysayers and those who object agreeing to uphold and support the decision in public?
- Is the relationship between the president and the board chair open, transparent, problem-solving, and strategic?
- Do committee chairs have a clear understanding of how committee work fits into the goals of the president and the administrative senior team?
- Does the committee structure work well at informing and guiding policy and practice?
- Do committee chairs have a chance to cross-reference their agendas so that overlap is noted and possible joint action is suggested?
- Does the board effectively handle a vociferous minority so that it does not paralyze board decision making?
- Does the board receive the right information for thoughtful analysis and decision making?
- Are communication channels open?
- Is it clear who needs to be involved in decisions? Are the right people in the room, on the phone, or online?
- Does the board appropriately deal with obstreperous faculty members, rogue trustees, and other difficult situations?
- How frequently and for what purposes is the executive committee used? Does it make a full disclosure of the actions it has taken to the rest of the board and avoid the sense of an “inner circle”? Does it allow for the potential of an override by the full board?
- Does the board understand its role vis-à-vis other important constituencies, such as the administration and the faculty?
- Does the board interact frequently and appropriately with students? Does it seek student input and feedback to the board as warranted? Is it “safe” for students to provide recommendations?
- Does the board have realistic expectations of its ability to impact the institution or system over a period of time?
- Is everyone focused on a shared strategy and implementation that moves the institution in a determined direction?