The following is an excerpt from a conversation that took place at MLR Media’s The Private Company Governance Summit 2025.
SPEAKERS: BILL HAYES, editor in chief, Private Company Director; COLETTE LaFORCE, independent director and committee chair, Ulteig Engineering, FGM Architects, Argus; STEVEN LUSTIG, director, Loh Medical, Mills Manufacturing; PAMELA PACKARD, lead independent director, Gray & Company Inc.
HAYES: What are the most essential characteristics or behaviors that need to be displayed in the relationship between the board and the CEO?
PACKARD: I use a framework I call the “collection of Cs” — collaboration, communication, culture and clarity. Clarity includes well-defined roles and responsibilities, not just for the board and CEO, but also for ownership in private or family companies. The goal is mutual commitment and, ideally, shared passion for the mission and success. Accurate and timely communication, rooted in trust and good intent, is critical.
LUSTIG: I’d add the importance of a shared understanding of what governance means. Especially in companies adding independent directors for the first time, that definition of roles — what the board does and does not do — sets the tone. Intent also matters. If the board demonstrates that its intent is to support the CEO and the company’s long-term success, that helps build trust.
LaFORCE: The CEO role is often considered the “loneliest” role in the C-suite. The board needs to understand that and work to build a relationship that isn’t just transactional. Trust is essential, and it starts early. The earlier the board begins building a personal rapport, the more productive the relationship becomes.
HAYES: When does that trust-building process begin? During hiring? Onboarding?
LaFORCE: Ideally, the board is cultivating trust from the very first interview. That sense of structure and support can help a CEO candidate say, “This board has its act together.” A healthy CEO-board relationship also means succession planning starts well in advance. If a CEO departure is a surprise, something went wrong.
LUSTIG: We had a situation where the board approved a nonfamily CEO, and only later realized the fit wasn’t right. It wasn’t personal. It came down to leadership and strategic gaps. Fortunately, a qualified family member was ready to step in. But that experience underscored the importance of getting to know the CEO on a deeper level right away, including small group conversations, mentoring and committee interactions.
PACKARD: And the relationship-building never stops. It’s not just about board meetings. Shared experiences matter. I don’t play golf, but I’ve walked the course, driven the cart, even gone duck hunting with a CEO — 4 a.m., dressed in full camouflage, sitting in the blind. You do what you need to do to build trust.
HAYES: When should succession planning start?
LUSTIG: It should begin as soon as a new CEO is appointed. At minimum, a board committee — often comp or governance — should own the planning. Early on, check in quarterly. As the plan matures, the cadence can slow. The key is assessing internal and external candidates against the company’s future needs.
LaFORCE: That future orientation is crucial. Just because someone is a great internal operator doesn’t mean they’re the right leader for the company five years out. Boards need to balance a preference for internal successors with the company’s long-term trajectory. Trust helps navigate that.
HAYES: In private and family companies, how do you ensure board input is respected?
PACKARD: Private company boards must clearly define who owns what decisions. The board’s role is to provide perspective, not to dictate. What matters is a feedback loop. If the CEO takes a different path than what was discussed, they should explain why. And if they don’t, it’s up to the board to reopen the conversation.
LUSTIG: It gets more complex when family members are working in the business. You need to be clear which “room” you’re in — family council, boardroom or management. If a family member reports to a nonfamily CEO, but doesn’t treat them like the boss, that’s a problem.
HAYES: How should boards deliver performance feedback to the CEO?
LaFORCE: It starts with structure. A formal performance scorecard removes emotion from the process. Even in young boards without formal committees, building a compensation plan and scorecard should be an early priority. That structure supports honest conversations.
PACKARD: And when performance does need improvement, offer support. Coaching, peer networks — bring tools to the table, not just criticism.
LUSTIG: Feedback must go both ways. Boards should ask CEOs: What are we doing well? What should we stop doing? What should we start doing? It shows respect and strengthens the relationship.
HAYES: How should a director act when it is time to fire the CEO?
LaFORCE: There should be no surprises. If a CEO is caught off guard, the board failed. Open, consistent communication prevents that. I’ve seen boards do this well — taking executive session feedback straight to the CEO, even inviting them into the session. Transparency builds accountability.
HAYES: How important is the role of the board chair or lead director in making sure the relationship between a board and CEO is smooth?
PACKARD: The lead director or chair plays a critical role here. You can’t have someone on the board who creates friction every time they speak. If there’s a breakdown in communication with the CEO, the lead director may need to step in or even reassess board composition.
LaFORCE: Mediation can be part of the job. Ultimately, the goal is a high-functioning board-CEO partnership built on mutual respect and a shared vision for where the company is going.