The year 2019 is ending and the year 2020 will begin soon. With the start of the new year and start of a new decade, it is imperative that the board leaders (independent chairs or lead directors) rethink their strategy on how to interact and operate with their businesses because they are the catalyst for changes in any business.
It is high time these leaders realign their thoughts and address the fast-changing economic, technological and social trends to initiate changes in their leadership style and how the businesses operate. This means the board leadership should be future-ready and look at governance from a bird’s eye view i.e. 360-degree governance.
We’ve listed five shifts in governance that the board leaders can orchestrate for the future success of their companies:
- Board leaders should find ways to engage more with the management on topics like strategizing and risk mitigation. Changing times will demand revolutionary changes in business & risk mitigation strategies. And the leaders need to be the ones to guide the management about such strategies.
- With technological shifts, board leaders need to adapt to forward-thinking approaches and devise strategies in-tune with management to adapt to such technological changes. Having a vision can help leaders be future-ready with the latest technologies to gain competitive advantage.
- Flexibility & dynamism is the key to operating a business in modern times. Using virtual tools, rethinking agendas to meet investor expectations & optimization of meeting times is what is expected out of board leaders. Without flexibility, chances of any business or board members surviving for too long will be bleak.
- Board members also need to adapt to more transparent means when it comes to governance & their way of working. Transparency is vital if board members want to win the confidence of management & other investors. It is imperative that the governing members be aware of the latest technological trends, latest trends in governance & risk mitigation or management trends.
- Responsibility and accountability are also the core areas where transparency is required. Individual directors should be answerable when it comes to their performance and the board leaders should be held accountable to their stakeholders or investors for the overall business performance. Rigorous accountability will lead to improved leadership & benefit the business in the long term.
When it comes to 360-degree governance, board leaders need to be all-rounders. They should be open to debates and discussions during the decision making process as it will benefit the business. Knowing about the latest technological trends, risks that come with these technologies and changes in risk mitigation strategies or changes in management strategies will help them improve governance practices thus leading to better business processes and operational transparency. We can say that by following a 360-degree governance, the leaders can make their businesses future-ready and create opportunities for new and improved board-room practices.