IMHO: Remuneration in reality
We need to move away from increasing wages and salaries using percentages rather than dollar figures.
Boards are rightly challenged to make the most complex decisions that their organisation will ever face.
From the existential – what is our purpose? the strategic – where do we play and how do we win? executive – do we have the right CEO? and even the moral – is what we are doing “right”?
Definition: superpower (noun) /ˈsuːpəpaʊə/
(in fiction) an exceptional or extraordinary power or ability
"she uses her superpowers to combat evil"
From Oxford Languages
The good news is that individual board members do not need superhuman powers (or be a fictional character) to be part of an super decision-making group.
This is fortunate, as some superpowers such as invisibility, flying and shapeshifting, could actually be quite distracting during board meetings...
Whist the skills, knowledge and experience make up the expertise of board members are no-doubt crucial, there are other factors that determine whether a board is actually “super” or merely an agglomeration of (hopefully talented) individuals.
When a board is addressing complexity, its performance will be not be determined by any one individual’s contribution in isolation but instead by the combined contribution and interaction of the board members and others involved in the process.
Complexity cannot be successfully tackled by one frame of reference, one mindset or one world view.
It relies on 1) the presence of differences between the thinking of board members and 2) the manifestation of a culture that allows individuals board members to unreservedly share their thoughts and actively attend to the perspectives of others.
These two elements - composition and culture, form the basis of a truly useful board superpower: diversity of thought.
In the 1980s TV series a five space explorers come together to form the superpowered giant robot "Voltron".
Voltron was only able to defend the universe when all its team members came together in the right way:
“Ready to form Voltron! Active interlocks! Dyna-therms connected. Infra-cells up; mega-thrusters are go!”
Compared to Voltron, your board may have a somewhat less showy way of coming together to activate your superpower.
Diversity of thought – a board’s superpower in action
(Inspired by a real life case study)
The Black Lives Matter movement and increased awareness of the long-term harms from colonialism has been a challenge for many boards. The experiences of one social services organisation provide an example of how diversity of thought was instrumental to navigating this challenge.
As a provider to the wider community over many generations, a non-governmental organisation has fostered positive associations with both the general public and government. Therefore they receive both public donations and governmental funding to support their services.
Recently an outsider to the organisation contacted the board and highlighted that their organisation was originally established by someone who we would now describe as a white supremacist. Furthermore, they claimed the organisation continued to apply a euro-centric, colonial lens to the way they provided services with an impact on minorities. Unless they proceeded to “tear the organisation down and rebuild it from scratch”, the outsider threatened to become a whistle-blower to the media.
The board took the claims and threat seriously. After intensive discussion and reflection, all but one outlier board member supported a radical shift in the approach of the organisation - services would become closely aligned with the cultural needs of minority communities.
The outlier board member held a different view. They believed that despite its imperfect origins, the organisation was not currently a racist one, an equivalent service was offered to everyone including minority groups. Wouldn’t moving to a model where some ethnic groups received added services amount to a form of discrimination? Furthermore, surely there was a risk that a radical shift in the fundamental cultural approach of the organisation could alienate existing stakeholders, funders and donors?
The outlier board member, although highly principled, was not intransigent. They embarked on a personal journey of discovery to better inform their independent view. They consulted outside of the organisation with members of the minority group. Their beliefs evolved to a point where they could appreciate that an equality of services based on the approach of the majority group was not going to improve the experience and outcomes for minorities. They accepted that the organisation should embrace an equity approach. Although due to the outlier’s perspective and influence, the board now resolved that the pace of change should be moderated, so that community stakeholders and funders could be brought along too.
Successful organisational change was achieved as the board were willing to genuinely consider an outsider’s view, even one that was quite extreme. The outlier board member, who started with a view that was very different to the board (and the outsider), ended-up being pivotal in challenging the board’s direction and informing the board’s execution approach. This ultimately achieves a way forward that will bring real change but without destroying the pre-existing goodwill of their stakeholders. No single individual is the hero of the story but through the presence of diversity of thought on the board, openness to external perspectives and a culture that allowed free disclosure of views and empathy for the contrasting views of others, a positive pragmatic outcome was achieved for the benefit of communities served by the organisation.
Demographic or identity diversity contribute to, but do not determine a board’s wide-ranging diversity of thought.
A board that has gender balance, mixed age, multi-ethnic, with LGBTQIA+ representation suggests both an inclusive approach and successful engagement with different talent pools.
People are multi-dimentional. Experiences associated with indentity diversity no-doubt influences thinking but does not define people's perspectives, beliefs and thoughts more broadly.
A high level of diversity across externally observable characteristics is highly commendable (and also particularly rare...) but it does not actually guarantee that a board will be diverse in other less visible dimensions that might influence thinking - for example: socio-economic background, political perspective, risk tolerance or problem-solving approach. That’s why I developed the DOT Scorecard as a tool to establish the potential for wide ranging diversity of thought based on ten dimensions for boards, teams and other decision-making groups.
Fortunately, there are tangible steps your board can take to develop or further enhance diversity of thought.
Let’s begin with three tips for increasing potential for wide ranging diversity of thought on your board:
Given the natural tendency of people to be drawn to those they are similar to, including those who think alike, there is often a considerable opportunity to increase diversity of thought. I have been promoting such the mission to increase the differences between the thinking of board members as an entirely virtuous quest.
Is it possible to have too much of good thing? In the case of diversity of thought it is quite uncommon but there are two scenarios that can be detrimental.
Firstly, and most commonly, if the board is not addressing complexity and instead has a remit that involves largely technical matters (eg a committee defining a technical standard), then expertise will likely be of greater value than diverse thinking.
More rarely, I have observed situations where an extremely high level of diverse thinking has occurred - perhaps by having a particularly large board, or another type of decision-making group. When this manifests there is a real risk of greater inter-personal dysfunction and a poorer decision-making culture. Each individual is unlikely to be appropriately included in the decision-making process. This risks the full potential of a board not being realised and clear decisions not actually being made - making it challenging for management to proceed to effective execution.
Here are three actionable, if somewhat controversial, steps you can improve your board’s decision-making culture:
Psychological safety is another contributing factor that supports a board’s decision-making culture. It is essential to allow board members to feel able to share what they are really thinking, allowing them to express their independent views.
You too can "put on the cape" and be part of making diversity of thought your board's superpower.
There is a natural tendency for boards’ thinking to converge towards groupthink over time.
Achieving and maintaining inherent potential for diverse thinking and an enabling decision-making culture is far from easy. But I believe actively developing your board’s diversity of thought is essential to successful board performance.
As Superman once said:
“There is a superhero in all of us. We just need the courage to put on the cape.”
Lloyd Mander CMInstD
Lloyd is the IoD's Canterbury Branch Committee representative on the National Council. He leads DOT Scorecard, a consultancy that works with boards and executive teams facing complex decisions to improve capability for wide-ranging diversity of thought and develop the decision-making culture that is required to realise diverse thinking. Read more
Lloyd will be presenting at our 2021 Leadership conference 5-6 May.
Also see IoD's Mentoring for Diversity programme. Mentoring for Diversity matches experienced directors with a board chair or senior director for one-to-one coaching for a year.