The Power of a Board Ethos

Shared aspirations, beliefs and attitudes drive the effectiveness of a private company board.

In a recent discussion I participated in with other directors about board effectiveness and performance, one director made a profound statement that resonated with several other directors. He said, “Our board does all the things we’re supposed to, but we’re not as good as we should be, nor is the business.” The discussion quickly moved to, “Why not?”  

In today’s environment, many private companies continue to improve their board structures, composition, policies and practices, but these fail to really make the hoped-for difference to the enterprise. As a longtime advocate for board practices that are appropriate for a company’s circumstances vs. just mimicking general board best practices that don’t practically apply or are applied with “form over substance,” I have found that having a clear and fully embraced board ethos is the foundation for a board that can affect business success. 

What is board ethos? Is it board culture? Is it purpose? Is it a set of policies? Is it fiduciary responsibility? Underlying the idea of board ethos is the recognition that the most successful private company boards embrace clarity on individual director behavior, director capability and team dynamics. I define board ethos as the shared aspiration and set of unifying beliefs and attitudes that bind a board in its purpose and effectiveness. When this foundation is clear, it will bring together the best directors to collaborate and enhance the success of the enterprise.

- Advertisement -

With a strong board ethos, your board will not only embrace and adopt more beneficial practices but also will function to its highest potential, supercharging the practices that are adopted. You will also find that the ability to attract the best board candidates is enhanced when you have a clear board ethos. Board ethos can be even more impactful in providing the foundation for a private family business board where legacy, economic and multigenerational considerations often require a transition that can stress board dynamics despite the good intention of “best practices.”  

The right board ethos creates a great place to contribute as a board member and a personally satisfying and enriching experience. A central, driving board ethos serves as the core of who is on the board, how a board works and what board practices are most relevant. There is no one magical board ethos, but each board has an opportunity to define what works for them, how they wish to operate and how they can accelerate their performance together.

Here is an example of one company’s board ethos:

  • High performance matters. We are motivated by our responsibilities and are aligned in our commitment to a high-performance organization. We expect high performance and contribution from our board as a whole and each of our individual directors. This requires your individual, delivered points of view based on investment in preparation, experience and judgment.
  • Focus. We choose to stay focused on the key competitive, business and organizational issues that are important to all of our shareholders and stakeholders, driving the health and performance of the enterprise. We are willing to do less on what matters less in our accountability, in order to do more on what does matter for all. Focus requires managing our mindshare and timeshare.
  • Simplicity drives clarity. We keep matters simple, so alternatives can be assessed at their core. We distill complex issues down to simple critical deliberation and decision-making criteria. We strive to summarize and frame the issues being discussed in a way that engages all board directors and allows us to consider their individual perspectives.
  • Respect. We encourage and respect different points of view, what they bring to understanding the issues, and their role in deliberating on key decisions. We are active, engaged listeners with interest in what our board colleagues have to contribute, knowing that their views are offered for the good of the whole.
  • We do what’s right. We will always do what is right and necessary, no matter how difficult. We understand that we may be asked to consider difficult choices to be made on key matters, and we as a board team accept this responsibility confidently, based on the common commitment all directors have to the long-term health of the enterprise.
  • Stewardship. We serve as stewards of the company’s legacy, its future direction and its business performance, enhancing the overall success of the enterprise. We completely embrace our responsibility for engaging the best leadership talent, clear business direction, ongoing performance oversight and the financial health of the enterprise. We aim to be outstanding stewards.

This example may seem simple and straightforward, but it does serve as good guidance for this board. The process of discussing your board’s ethos will prove insightful and unifying, even if you don’t write it down. Form your own board ethos and live by it. It will accelerate your board performance more than any other factor.

Don Yee has been a CEO or an independent board member of numerous companies, from mid-market to multibillion-dollar businesses. He currently serves as a strategic business advisor and on the boards of Aerometals (where he is chair), Lundberg Farms and the Fat Group of Companies.

About the Author(s)

Bill Hayes

Bill Hayes is managing editor of Private Company Director.


Related Articles

Navigate the Boardroom

Sign up for the Private Company Director weekly newsletter for the latest news, trends and analysis impacting public company boardrooms.