Expert Coaching. Practical Resources.

March 21, 2024

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Richard Stringham

Understanding Those to Whom Your Board is Accountable

When you hear the term “accountable governance,” what comes to mind?

For many, they think of accountability to the law, to government authorities, or to funders and donors.

Certainly, those are important for a board’s accountability. But there is another group to whom the board is accountable. In corporations, that group is the shareholder body. Boards using Policy Governance will be familiar with the concept that they are accountable to a group equivalent to a shareholder body, …someone group external to the board. We refer to this group as the ownership, although you might also hear terms such as: “principal stakeholder” or “careholder” for the same group.

Furthermore, the board is expected to reach out to that ownership and seek to understand the ownership’s perspective, particularly its values. Here we’re thinking of values for what the organization should achieve, for whom, and values related to its conduct.

The board uses its understanding of those perspectives when it makes its decisions which direct the organization. In short, the board translates the values of the ownership into operational performance.

Although boards understand this concept, knowing how to reach out to the ownership is often a challenge. This is especially so when the ownership is composed of a large number of people with diverse perspectives.

One idea that can be helpful is to approach this ownership linkage in cycles.

The first phase is to use methods and ask questions which expand the board’s awareness of the diversity of the ownership’s perspectives. Typically, this is achieved with open ended questions.

The next phase is to learn how pervasive that diverse set of values is. To do so, the board can ask closed ended questions in which respondents prioritize a range of options collected in the first phase. This gives the board a better sense of whether many in the ownership share the same values or whether the board is hearing more from a small interest group, perhaps one with loud voices.

The board uses this input, combined with others (subject for another day), to reconsider its policies, perhaps setting a new direction for the organization.

Rinse and repeat!

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