“How do some boards achieve their full collective potential as a group in actively shaping the strategic direction of the company and others don't? How do boards become more influential in their value creation roles?”
Dr.Meena Thuraisingham, Author of “Identity, Power and Influence in the boardroom” (Routledge, 2019)
Setting strategy is a core board responsibility. Boards must be able to not only review and endorse strategy but to co-create it with management. This is a given, yet how non-executive directors (NEDs) exercise this accountability is far from uniform. NED involvement in strategy can range from largely endorsing strategy at one end, to active involvement in developing both the direction and content of strategy at the other end.
For boards to thrive, it is not enough to have a deep understanding and a feel for the industry the firm operates in. Nor is it sufficient to be curious and committed to continually deepening this knowledge. Nor does it simply require a focus on both the lag and lead measures of sector success.
To succeed individually and collectively, NEDs must strike a balance between their skill and propensity in influencing others and their propensity to be influenced by others.
Read our paper on how boards thrive when can fully leverage their collective potential here: Unlocking the board’s potential.