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EFFECTIVE BOARD

LEADERSHIP &
STRATEGY
Presented to : Mr.Humayun Zafar
Presented By: Group-1

Ahmed Faizan Kashmiri


Shahzad Shiraz
Zeeshan Abbas
Hayyan Siddiqi
Asif Sheikh
Marylin Ambrose

LETTER OF TRANSMITTAL
December 16th, 2015
Mr. Humayun Zafar
Faculty, Corporate Governance
IoBM Karachi

Subject: Report on effective board leadership & Strategy


Dear Sir,
Here is the final report on the topic, effective board leadership & Strategy. which you had
authorized us to conduct at the beginning of this semester. The report is now ready for your
perusal.
This report is a brief representation of the Concept effective board leadership & Strategy, we
have analyzed the factors and influencers which are very important and keen while evaluating
the such area.
The making of this report has been a wonderful learning experience for us and we thank you for
giving us this opportunity to avail it. We have worked attentively with our toiling deeds to
provide you a real and complete picture of the effective board leadership & Strategy.
Sincerely,

All Group
MBA (Executive)
Institute of Business Management, Karachi.

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LETTER OF ACKNOWLEDGEMENT

December 16th, 2015

Mr. Humayun Zafar


Faculty, Economic Department,
Institute of Business Management
Korangi Creek
Karachi-75190

Dear Sir
This is to inform you that we hereby, are submitting the term report of Mr. Humayun Zafar as
attached.
We are grateful to Almighty, who enabled us to undertake this task and bestowed upon us, His
great blessings all the way through. We are highly grateful to you for your valuable time and
help that you rendered in spite of your busy schedule and for your precious guidance at every
step. You have been a source of enthusiasm and courage which kept us energetic during the
whole semester. The knowledge shared is priceless and would remain there with us throughout
the life.

Sincerely,

All Group Members


MBA (Executive)
Institute of Business Management, Karachi.

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TABLE OF CONTENT
WHAT IS BOARD
INTRODUCTION & DEFINITION................................................................................................................................... 5
WHAT THEY DO /DUTIES OF A DIRECTOR ................................................................................................................... 5
TYPES OF DIRECTORS IN A BOARDS .................................................................................................................... 6
BOARD PROCESS / BOARD AFFAIRS MANAGEMENT ........................................................................................................ 6
DUTIES OF A BOARD.............................................................................................................................................. 6
WHAT IS STRATEGY
WHAT IS MEANT BY CORPORATE/ORGANIZATIONAL STRATEGY ......................................................................................... 9
WHAT SKILLS ARE NEEDED IN BOD, IN ORDER TO MAKE AN EFFECTIVE C-STRATEGY ........................................... 10
QUESTIONS THAT SHOULD BE TAKEN CARE OF WHILE SETTING A STRATEGIC DIRECTION ......................................................... 11
LINK BETWEEN BOARDS & STRATEGY
HOW BOARD & MANAGEMENT SETS OUT SYNERGY EFFECT ............................................................................. 12
ROLE OF BOARD IN STRATEGY SETTING AND MONITORING .............................................................................. 12
WHAT TO FOCUS BY DIRECTORS TO STRENGTHEN THE STRATEGY AND DIRECTION .......................................... 14
BOARD AND STRATEGY LINK ............................................................................................................................ 15
EFFECTIVE BOARD LEADERSHIP
THE CONCEPT ....................................................................................................................................................... 16

BOARDS GOVERN ALWAYS, LEAD SOMETIMES ............................................................................................................ 16


REFLE CTIONS ON WHAT IS MEANT BY LEADER SHIP IN BOARDS ....................................................................... 17
LEADERSHIP FROM ANY SEAT .................................................................................................................................. 18
DIFFERENT LEADERSHIP STYLES ................................................................................................................................ 18
HOW BOARDS CREATE A CULTURE THAT PROMOTES LEADERSHIP .................................................................................... 19
WHAT SHOULD BE ADOPTED TO ENHANCE BOARD LEADERSHIP ...................................................................... 20
IDEAL BOARD SYNC BY BOARD LEADERSHIP SETTING STRATEGIC DIRECTON .................................................... 22

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A- WHAT IS BOARD
INTRODUCTION & DEFINITION

A board of directors is a body of elected or appointed members who jointly oversee the
activities of a company or organization. Other names include board of governors, board of
managers, board of regents, board of trustees, and board of visitors. It is often simply referred
to as "the board".
A board's activities are determined by the powers, duties, and responsibilities delegated to it or
conferred on it by an authority outside itself. These matters are typically detailed in the
organization's bylaws. The bylaws commonly also specify the number of members of the board,
how they are to be chosen, and when they are to meet. However, these bylaws rarely address a
board's powers when faced with a corporate turnaround or restructuring, where board
members need to act as agents of change in addition to their traditional fiduciary
responsibilities.
In an organization with voting members, the board acts on behalf of, and is subordinate to, the
organization's full group, which usually chooses the members of the board. In a stock
corporation, the board is elected by the shareholders and is the highest authority in the
management of the corporation. In a non-stock corporation with no general voting
membership, the board is the supreme governing body of the institution; its members are
sometimes chosen by the board itself.
WHAT THEY DO /DUTIES OF A DIRECTOR

Typical duties of boards of directors include:

governing the organization by establishing broad policies and objectives


selecting, appointing, supporting and reviewing the performance of the chief executive
ensuring the availability of adequate financial resources
approving annual budgets
accounting to the stakeholders for the organization's performance
setting the salaries and compensation of company management

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TYPES OF DIRECTORS IN A BOARDS

A Director may or may not be:

Executive
Non Executive
Independent

BOARD PROCESS / BOARD AFFAIRS MANAGEMENT

The process for running a board, sometimes called the board process, includes the selection of
board members, the setting of clear board objectives, the dissemination of documents or board
package to the board members, the collaborative creation of an agenda for the meeting, the
creation and follow-up of assigned action items, and the assessment of the board process
through standardized assessments of board members, owners, and CEOs.
The science of this process has been slow to develop due to the secretive nature of the way
most companies run their boards; however some standardization is beginning to develop. Some
who are pushing for this standardization in the USA are the National Association of Corporate
Directors, McKinsey Consulting and The Board Group.
DUTIES OF A BOARD

Because directors exercise control and management over the organization, but organizations
are (in theory) run for the benefit of the shareholders, the law imposes strict duties on directors
in relation to the exercise of their duties. The duties imposed on directors are fiduciary duties,
similar to those that the law imposes on those in similar positions of trust: agents and trustees.
The duties apply to each director separately, while the powers apply to the board jointly. Also,
the duties are owed to the company itself, and not to any other entity. This does not mean that
directors can never stand in a fiduciary relationship to the individual shareholders; they may
well have such a duty in certain circumstances.
PROPER PURPOSE
Directors must exercise their powers for a proper purpose. While in many instances an
improper purpose is readily evident, such as a director looking to feather his or her own nest or
divert an investment opportunity to a relative, such breaches usually involve a breach of the
director's duty to act in good faith. Greater difficulties arise where the director, while acting in
good faith, is serving a purpose that is not regarded by the law as proper.
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The seminal authority in relation to what amounts to a proper purpose is the UK Supreme Court
decision in Eclairs Group Ltd v JKX Oil & Gas plc [2015] UKSC 71 (2 December 2015). The case
concerned the powers of directors under the articles of association of the company to
disenfranchise voting rights attached to shares for failure to properly comply with notice served
on the shareholders. Prior to that case the leading authority was Howard Smith Ltd v Ampol
Ltd [1974] AC 821. The case concerned the power of the directors to issue new shares. It was
alleged that the directors had issued a large number of new shares purely to deprive a
particular shareholder of his voting majority. An argument that the power to issue shares could
only be properly exercised to raise new capital was rejected as too narrow, and it was held that
it would be a proper exercise of the director's powers to issue shares to a larger company to
ensure the financial stability of the company, or as part of an agreement to exploit mineral
rights owned by the company. If so, the mere fact that an incidental result (even if it was a
desired consequence) was that a shareholder lost his majority, or a takeover bid was defeated,
this would not itself make the share issue improper. But if the sole purpose was to destroy a
voting majority or block a takeover bid, that would be an improper purpose. Not all jurisdictions
recognized the "proper purpose" duty as separate from the "good faith" duty however.
UNFETTERED DISCRETION
Directors cannot, without the consent of the company, fetter their discretion in relation to the
exercise of their powers, and cannot bind themselves to vote in a particular way at future board
meetings. This is so even if there is no improper motive or purpose, and no personal advantage
to the director.
This does not mean, however, that the board cannot agree to the company entering into a
contract which binds the company to a certain course, even if certain actions in that course will
require further board approval. The company remains bound, but the directors retain the
discretion to vote against taking the future actions (although that may involve a breach by the
company of the contract that the board previously approved).
CONFLICT OF DUTY AND INTEREST
As fiduciaries, the directors may not put themselves in a position where their interests and
duties conflict with the duties that they owe to the company. The law takes the view that good
faith must not only be done, but must be manifestly seen to be done, and zealously patrols the
conduct of directors in this regard; and will not allow directors to escape liability by asserting
that his decision was in fact well founded. Traditionally, the law has divided conflicts of duty
and interest into three sub-categories.

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TRANSACTIONS WITH THE COMPANY


By definition, where a director enters into a transaction with a company, there is a conflict
between the director's interest (to do well for him out of the transaction) and his duty to the
company (to ensure that the company gets as much as it can out of the transaction). This rule is
so strictly enforced that, even where the conflict of interest or conflict of duty is purely
hypothetical, the directors can be forced to disgorge all personal gains arising from it. In
Aberdeen Ry v Blaikie (1854) 1 Macq HL 461 Lord Cranworth stated in his judgment that:
"A corporate body can only act by agents, and it is, of course, the duty of those agents so to act
as best to promote the interests of the corporation whose affairs they are conducting. Such
agents have duties to discharge of a fiduciary nature towards their principal. And it is a rule of
universal application that no one, having such duties to discharge, shall be allowed to enter into
engagements in which he has, or can have, a personal interest conflicting or which possibly may
conflict, with the interests of those whom he is bound to protect... So strictly is this principle
adhered to that no question is allowed to be raised as to the fairness or unfairness of the
contract entered into..."
However, in many jurisdictions the members of the company are permitted to ratify
transactions which would otherwise fall foul of this principle. It is also largely accepted in most
jurisdictions that this principle can be overridden in the company's constitution.
In many countries, there is also a statutory duty to declare interests in relation to any
transactions, and the director can be fined for failing to make disclosure.
USE OF CORPORATE PROPERTY, OPPORTUNITY, OR INFORMATION
Directors must not, without the informed consent of the company, use for their own profit the
company's assets, opportunities, or information. This prohibition is much less flexible than the
prohibition against the transactions with the company, and attempts to circumvent it using
provisions in the articles have met with limited success.
In Regal (Hastings) Ltd v Gulliver [1942] All ER 378 the House of Lords, in upholding what was
regarded as a wholly unmeritorious claim by the shareholders, held that:
"(i) that what the directors did was so related to the affairs of the company that it can properly
be said to have been done in the course of their management and in the utilization of their
opportunities and special knowledge as directors; and (ii) that what they did resulted in profit to
themselves."

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B- WHAT IS STRATEGY
WHAT IS MEANT BY CORPORATE/ORGANIZATIONAL STRATEGY

The formulation of corporate strategy is a subject which does not lend itself to a generic
approach which can be copied and tailored to fit. Even some of the definitions and concepts are
interpreted in different ways, and individual circumstances will dictate how a specific strategy
should be developed and implemented, depending on the circumstances of the organization in
question.
Corporate strategy is based on knowing:

where your organization is today

where you want it to be

how you want to get there

The risk of not changing and improving can be as significant as the risks which may affect your
plans to develop your business - your competition is almost certainly changing and moving
ahead, and you are likely to be left behind in terms of efficiency, reputation and financial
success if you do not learn lessons and appreciate what factors may influence your likely
success in delivering your business goals.
These factors all impact on your corporate strategy and business plan. If the purpose of the
plan is business development rather than (just) a means of raising finance, it should be the basis
for your management system
Defining corporate strategy is a process. The objective of the process is to combine the
activities of the various functional areas of a business in a way which will achieve its
organizational objectives.

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It is not always written down or explicit, but it should determine how you:

are organized

set objectives, define policies and allocate resources

operate on a day-to-day basis (i.e. your operational processes)

The output of the process is a strategic plan which will set the parameters for detailed
operational and departmental plans.
WHAT SKILLS ARE NEEDED IN BOD, IN ORDER TO MAKE AN EFFECTIVE C-STRATEGY

In the US National Occupational Standards for management and leadership, module B3


(develop a strategic plan for your organization) states in the 'outcomes of effective
performance' that you must be able to:

Establish a clear, achievable and compelling vision which sets out where the
organization should be going

Identify and priorities strategic objectives that are consistent with the vision of the
organization

Balance risk with desired outcomes

Balance innovation with tried and tested solutions

Ensure that your plan is flexible and open to change

Develop policies and values that will guide the work of others towards your vision

Delegate responsibility for achieving goals and allocate resources effectively

Identify measures and methods for monitoring and evaluating the plan

Balance the needs and expectations of key stakeholders and win their support

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QUESTIONS THAT SHOULD BE TAKEN CARE OF WHILE SETTING A STRATEGIC DIRECTION

Considering all key issues and create a strategic plan for each, all supporting the overall mission:

marketing: segments, promotion, selling, products

people: training, communication, culture

resources: required and available

finance: funding, pricing, profit

Define policies to be followed. Such as:

Diversification /organic growth or acquisitions

methods of funding growth

in-house or subcontract production

Set clear goals, action plan and timescales. Such as:

what results are needed in the medium term?

what has to happen / not happen for the business to develop?

what are the main risks and how can they be overcome?

Assess financial implications:

basis for financial calculations (assumptions and constraints, sensitivity analysis)

current financial commitments

for each major product / project: major elements of cost / expected revenue / timescale

Operational objectives support the longer-term strategic objectives. They should be


measurable and should relate to both the vision and mission. They are detailed, costed
and timed plans of what you will do to meet each strategic goal. They set out a work
plan, typically over a 12-month period.

Controls and Audit procedures

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C- LINK BETWEEN BOARD & STRATEGY


Productivity and Governance always maintains a logical relationship, where Management acts
as a performer and boards are held as governors.
HOW BOARD & MANAGEMENT SETS OUT SYNERGY EFFECT
Strategic Planning There seems to be much confusion among CEOs and directors regarding a
boards role in planning the companys strategy and future direction. Recently in Perth, at one
of public seminars on this topic, the CEO of a mining company asked: Isnt it up to the board to
develop strategy? Were told strategic planning is the boards role. It depends what you mean
by strategy, consultant responded, but if you mean developing the details of how your
company is to achieve competitive advantage, then my answer is no.
WHY THE CONFUSION?
The source of the confusion may start with a misreading of the boards role in general. A board
is appointed by the shareholders (owners, members) of an organization to look after the best
interests of the company and its share holders.
For clarification in this area, the publication, Duties and Responsibilities of Directors and
Officers, by the Australian Institute of Company Directors, is a must-read for all directors and
CEOs.
In company law, a company is regarded as a person, and a boards role is care for that
individual, looking after its long-term survival, growth and prosperity.
ROLE OF BOARD IN STRATEGY SETTING AND MONITORING
The board has a pivotal role when it comes to company strategy. Firstly, the board must ensure
that the company has a strategy, and that it is the proper strategy for now and the future.
Secondly, the board may have to initiate the development of a long run strategy and may have
to become involved in the further development of this strategy.
Kenneth Andrews (1980), when writing about the boards responsibility, states:
A responsible and effective board should require of its management unique and durable
corporate strategy, reviews it periodically for its validity, use it as a reference point for all other
board decisions and share with management the risk associated with its adoption.

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Andrews was addressing the very large organization, but his views hold equally true for the
smaller firm, with one exception; that is, there may not be the depth of management available
in the smaller company to develop strategy, and this role by default may fall to the board itself.
The board, typically with a mix of inside and outside directors, may have to develop the long
run strategy, either with or without outside help. If it is a large board, a strategic planning
committee may be struck to tackle the task. The key point is that ultimately the board should
be responsible for the organizations strategy.
Performing this function is undoubtedly the most important role that the board should play in
the future of the organization.
Strategy is the balancing of the present and the future, of resources, and of opportunities or
threats. It is a sensitive process for the board, albeit an important one. For the larger firm, the
boards involvement is more as an appraiser, asking hard questions and evaluating strategy on
an ongoing basis. In the smaller firm, it is difficult for the board not to be involved in the
process. There are many strategic issues that only the board can deal with, the principle one
centered around the organizations purpose, broad philosophy, mission, and broad objectives.
The board of a smaller firm must go beyond being a body for sounding out ideas to become a
board involved in the future dynamics of the organization. The board must accept, change and
enhance the chief operating officers vision, and the vision must flow into the long run strategy
of the corporation.
There are several reasons for board involvement in strategy:
The board must assure itself that a process is in place to develop strategy.
The board must develop a viewpoint for choosing among opportunities.
The board members must develop an understanding of the dynamics of both the
organization and the industry. Knowledge and understanding of the environment in
which the business operates precedes intelligent decisions.
The board must evaluate the strategy of the corporation as it is developed. 5. The board
will eventually have to pass judgment on the outcome and the results of the strategy.
Without involvement and knowledge, this becomes a meaningless act.
The board must, to some extent, share the risk and exposure of the chief operating
officer and management. This sharing will create involvement and discipline, which in
turn will produce a more valuable board contribution.
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WHAT TO FOCUS BY DIRECTORS TO STRENGTHEN THE STRATEGY AND DIRECTION


The board as a whole should be actively involved in discussing, reviewing and ultimately
approving the plan. Directors can be a valuable resource by providing a fresh perspective and
asking questions to satisfy them that the plan is well thought out, realistic and compatible with
the organizations mission, vision and values. To ensure sufficient time for review and
discussion, a special strategy session is often scheduled. This session may take place offsite, be
significantly longer than a regular board meeting, and involve a professional facilitator. Final
approval of the strategic plan takes place at a board meeting.
IN PREPARATION FOR THE STRATEGY SESSION, DIRECTORS SHOULD EXPECT TO REVIEW
MATERIALS INCLUDING:
The previous years plans, budgets, and financial information;
A summary of the current years activities and progress;
Information on related organizations and national or international bodies;
Information on government policy and legislation that could affect the organization;
Analysis of the organizations strengths and weaknesses, as well as opportunities and Threats;
Strategic recommendations from management executives this material forms part of the
planning records and should be retained for future Reference. The minutes and notes from the
planning session will also become part of the Planning records and may include:
Decisions to retain or amend the vision, mission and values,
Decisions to continue or change the organizations strategy,
New projects and programs, and
Key measurements that will be used to monitor performance and progress
Using the guidance from the strategy session, the formal strategic plan is prepared and
presented to the board for approval at a regular board meeting. Once the board has approved
the strategic plan it is communicated to staff and volunteers for use in developing operational
plans and budgets. The strategy should also be communicated to key stakeholders in order to
build community interest and support for the organizations programs and activities.

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BOARD AND STRATEGY LINK

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D- EFFECTIVE BOARD LEADERSHIP


THE CONCEPT
Much has been written about governance on boards, but there is little that addresses the
development of leadership: how individuals who are volunteering their time transform
themselves into an active, engaged, and knowledgeable team one that can guide an
organization to anticipate and respond to the myriad challenges in the sector today. By
examining different literature on boards, and the combined experience of a team of
professionals, our report looks closely at what is meant by board leadership, what forms that
leadership takes, and how to create an organizational culture that encourages and supports
board members to step up to their leadership responsibilities.
Every board member should have a role to play to move the boards agenda forward and to
fulfill the boards oversight role.
Board leadership is expressed most powerfully and crucially during times of transition and
crisis; such periods are also when the absence of leadership is most visible and most
devastating to an organization.
BOARDS GOVERN ALWAYS, LEAD SOMETIMES
While the basic governance responsibilities of boards of directors are constant, leadership on a
good board is more fluid, ebbing and flowing as circumstances and organizational life cycles
require.
Board leadership is expressed most powerfully and crucially during times of transition and
crisis; such periods are also when the absence of leadership is most visible and most
devastating to an organization.
When things are running smoothly, the more routine governance duties are primary and board
leadership is devoted to streamlining systems, strategic planning and increased board activities.
At such times, the boards leadership (in the sense of control and direction) may seem more
below the surface. This is most often the case when there is strong, skilled and effective
executive director.

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REFLE CTIONS ON WHAT IS MEANT BY LEADER SHIP IN BOARDS


In general, questions will fall in the following categories:
LEADERSHIP QUALITIES
A number of personal qualities of leadership were repeatedly identified by various studies.
Some of these qualities may seem innate, but many arise from the alchemy of blending the
desire to make a difference, together with known/learned skills and the opportunity to act.
Good board leaders exhibit passion, commitment and vision, and they articulate these clearly.
They have the ability to communicate with and engage others. They know what they do not
know, are willing to take risks, are comfortable seeking outside help, and are honest and
forthright in recognizing and naming problems. They are able to support the executive director
by making time available to sustain his/her vision and implementation. However, the board
leaders first loyalty is to the mission and the constituencies the organization serves.

1. COMPLIANCE
As part of their governance responsibilities board members need to ask management to
demonstrate compliance with the laws and requirements governing nonprofit organizations,
and with the organizations commitments to clients, donors and other key stakeholders.
2. STRATEGY
Board leadership related to programs and priorities is strategic in nature. Their focus is less on
why we do things a certain way, and more on whether or not the organization is doing the right
things. Strategic questions from the board encourage board and staff to identify internal and
external changes and trends that affect clients, funding and activities so the organization can
formulate appropriate responses.
These questions help keep the focus on the big picture rather than on operations, and are
typically future oriented. Finally, they encourage and shape board leadership by helping board
members identify ways that they can help the organization respond to emerging needs and
opportunities.
3. EVALUATION
In most cases board members do not have the same level of programmatic expertise as the
staff. As community members holding the organization in trust on behalf of the public, board
members need to ask questions that help them evaluate the impact of the organizations work.
By raising the question of how the organization will measure success, and by systematically
Asking for benchmarks related to these measurements, the board leads by focusing staff
Attention on results instead of methods. Comparing these results to those of other

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organizations in the same field is particularly helpful. Also tracking results over time provides
useful information to allow the board to measure performance.

4. RESOURCES
Many boards spend a good deal of time thinking about and engaging in attracting investments.
One important question that can get overlooked is to ask how the organization is allocating the
resources it does have, and to ensure that this allocation is reflective of the organizations
priorities. Another set of questions relates to Shareholder`s interests and trends. What are
investors interested in? How has that changed? Should we (and, if so, how can we) position
ourselves in relationship to these interests? Finally, the board should ask and determine what
role it needs to play in maintaining current resources as well as in attracting new or increased
support.
5. BOARD STRUCTURES AND SYSTEMS
The board has to lead by asking questions about its own ways of working to make sure that its
operating and decision-making practices keep up with changing demands, shifting
responsibilities, board size and composition. A periodic self-evaluation can help board members
determine if they are paying attention to that which is most important, and if there are smarter
ways for them to work individually and collectively in order to achieve their goals.
LEADERSHIP FROM ANY SEAT
There is a tendency to think of leadership in terms of hierarchy, with the board chair playing the
strongest leadership role. It is certainly true that an effective board chair contributes
enormously to the boards productivity, and that a poor board chair can be a significant
obstacle to performance. Every board member, however, has a leadership role to play. Any
board member can and should raise the kinds of questions described previously. Every board
Member should have a role to play to move the boards agenda forward and to fulfill the
boards oversight role. Fundamentally, leadership entails speaking up when you have a concern
and contributing what you can to make the organization successful.

DIFFERENT LEADERSHIP STYLES


Not all forms of leadership are recognized as such. In fact, often leaders do not recognize their
own leadership or leadership potential. People often became leaders because someone they
respected called them to leadership. Also, leadership may take on very different attributes in
different cultures, as well as among different ethnic, age and/or gender groups. One
community may admire forceful and outspoken leaders while others might respond to a more
Consensus-oriented approach. Different organizational circumstances call for different
leadership styles. At times of upheaval a consensus builder may be needed. One organization
described two types of leaders: Visionaries and Implementers. In the first group are the
strategic thinkers who have imagination and are focused on the long haul. The second are
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those who can figure out what is needed, right now, in order to make something work and who
enjoy concrete tasks. They can also help the executive director think through
The impact a new undertaking may have on the organizations ability to maintain its regular
operations
HOW BOARDS CREATE A CULTURE THAT PROMOTES LEADERSHIP
We have found the following practices key to creating a productive culture on the board:

Recruit people to the board who have a passion for your mission.
Connect trustees with the organizations work through direct experience, conversations
with program staff and compelling stories that illustrate the importance of the
organizations work.
State expectations of board members up front during the recruitment process.
Make time to talk together as a board about the culture that you want to create or
perpetuate on the board, and how you can work together most productively.
Let potential board members know about the culture of the board up front.
Create rituals to celebrate achievements, recognize people who have made a
contribution, and mark new moments in an organizations history.
Compare how the board operates with the organizations values, and determine if the
structure and the values need to be more closely aligned
Acknowledge the contributions of those who have made the organization what it is
today, and then focus on how to maintain the founding principles in a changing
environment

Recruit individuals who are passionate about the mission. Most board leaders should be
motivated by themselves to step up to leadership, even in times of crisis, board members
talked about their belief that the work of their organizations needed to be continued for the
sake of the community.
Their commitment to the mission should go beyond their loyalty to any one individual. In times
of crisis, board leaders should show personal commitment, determination and courage, each of
which is crucial to the maturation of the full board.

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WHAT SHOULD BE ADOPTED TO ENHANCE BOARD LEADERSHIP

1. ENCOURAGE BOARD MEMBERS TO TELL EACH OTHER WHAT MOTIVATES THEM


TO SERVE.
Directors need to remind themselves why they joined the board. one might even want to have
board members sign an annual affirmation of their commitment to the organization to raise
their consciousness. This can also allow them to step off-if they realize they can no longer
commit.

2. EDUCATE BOARD MEMBERS ABOUT THE ORGANIZATION AND THEIR


RESPONSIBILITIES.
Start with a good orientation that includes the organization's history. Then, train board
members in good governance principles and effective group decision-making processes. Be sure
to educate board members about the programs-especially their connection to mission and
Resultsso that they can make informed decisions about them and fundraise better.

3. HOLD THE BOARD ACCOUNTABLE FOR ITS OWN PERFORMANCE AND CONDUCT A
CANDID BOARD ASSESSMENT.
Use a self-assessment tool or an objective outside consultant. The executive committee or
governance committee should lead the assessment and board development planning process.
Board chairs should meet regularly with other board members to ask what their satisfaction
levels and goals are and how the overall board is performing. Based on the assessment, develop
a plan for board development.

4. COMPEL THE BOARD TO CONTINUALLY PLAN FOR THE FUTURE AND FOCUS ON
RESULTS.
One of the most important responsibilities of a board is to help the organization plan for the
future. Boards need to conduct scans for environmental changes and create visions that
respond to those shifts. The strategic planning process can be reinvigorating and help board
members to work together better as a team.

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5. INFUSE BOARD MEETINGS WITH MORE MEANING.


Once the plan is done, develop board-meeting agendas that correspond with the goals in the
plan to keep meetings focused on the important priorities. Concentrate on making decisions at
meetings and avoid one-way communication from staff. Use consent agendas to lump together
Routine matters that might not require lots of attention. End board meetings with an appraisal
of how the meeting went and a discussion of what to cover at the next meeting.
6. ADD SOME NEW BOARD MEMBERS AND GRADUATE SOME EXISTING ONES.
Begin by having the executive or nominating committee determines whether the board needs
to become bigger or smaller. If the board needs new members, have the committee identify
board composition needs and then strategically fill slots. Cast a wide net for underrepresented
Groups to ensure diversity and try to seek younger up-and-comers, rather than over-committed
heavy hitters. If the board needs to shrink or you need to get rid of underperforming board
members, consider using term limits or required rotation. You might want to Develop a board
alumni council to keep former board members involved.

7. NURTURE FUTURE LEADERSHIP.


Board leaders should consciously mentor the next generation of leadership. All new board
members must have the potential for assuming a leadership role during their tenure. Use
committees as a way to provide opportunities for emerging leaders to take on more
responsibility. Consider having multiple vice chairs so that you aren't stuck if one can't become
chair.
8. DEVELOP A SYNERGISTIC BOARD-CEO PARTNERSHIP.
A good CEO-board chair relationship is like a good marriage: It is based on mutual respect, trust,
commitment, and effective communication. Board and executive leadership need to work
together to plan, set agendas and policies, act as ambassadors for the organization, and raise
Money. The CEO needs to be involved in any board development process, and the board chair
must be kept abreast of major developments in the CEO's areas of responsibility.
9. CONSIDER ALTERNATIVE MODELS FOR GOVERNANCE.
Some say that conventional models for nonprofit governance may be broken, so trying to
improve board performance within this context is like putting a Band-Aid on huge wound. You
might want to consider replacing typical models of governance with alternative ones. Some
boards have eliminated committees and, instead, use ad hoc workgroups that are time-limited
and outcomes-focused.
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IDEAL BOARD SYNC BY BOARD LEADERSHIP SETTING STRATEGIC DIRECTON

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REFERENCES

Journal of Leadership Education Volume 8, Issue 2 Fall 2009

Summer 2005 Vol. V, No. GREAT BOARDS Published by Bader & Associates Governance
Consultants, Potomac, MD

Small Business Management,Dryden Canada, 1992.

Board Effectiveness What Works Best 2nd Edition

Building Effective Boards By Linda Lysakowski, ACFRE

An Oracle White Paper June 2012 Seven Steps for Effective Leadership Development

JOURNAL for Nonprofit Management 2008

Effective Leadership: Theory, Cases, And Applications Author: Ronald (Ron) H. Humphrey,

Journal of Canadian Institute of Chartered Accountants 2003.

Encouraging Visionary Board Leadership Frank Martinelli The Center for Public Skills
Training.

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