Company Culture Starts With Corporate Governance

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You’ve seen the headlines—“company culture” is one of the most-covered topics in business leadership over the past couple of years. You can read about why you shouldn’t just let your company culture happen. You can explore “Why Corporate Culture Is Becoming More Important.” And, of course, you can dive into how certain types of company culture will boost your organization’s performance.

Before we launch into how company culture begins with the board, let’s define the term we’re using. According to Wikipedia, company culture (also referred to as organizational culture) “encompasses values and behaviors that contribute to the unique social and psychological environment of an organization…and includes the organization’s vision, values, norms, systems, symbols, language, assumptions, environment, location, beliefs, and habits.” Yes, that’s a long definition! To simplify, though, company culture is created through a blend of the practices, policies, and people that make up an organization.
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Best Websites for Board-Related Education

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Let’s face it, these days the board landscape is shifting and evolving at lightning speed. It can be difficult to stay up-to-date on all the latest trends in corporate governance. At Directorpoint, we do our best to help keep you knowledgeable with our weekly newsletter, but where should you go looking for information when questions arise? We’ve compiled this helpful guide to tell you about some of the most useful board resource websites.

  1. The National Association for Corporate Directors (NACD)

NACD has been providing directors with news and educational information for more than 40 years. Although it takes a paid membership to access all of their materials, they also share articles and information frequently via social media. Their monthly magazine, Directorship, is always chock-full of valuable guidance and news-related activity in the board sphere.
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The First-Time Board Member Checklist

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Board membership is an adventure in leadership unlike any other. Individuals who are new to the role of director will be challenged in new and unique ways. In order to meet this challenge head-on, they’ll need to continually develop their expertise while adjusting to a system of checks and balances that is meant to help bring the best decisions forward.

An experienced CEO or CFO may jump into a first-time board position with a lot of confidence, and that’s a good thing! But they also need to understand the ways in which their role will differ from the internal positions they’ve held in the past. Here are some tips for making a smooth transition from business leader to board member extraordinaire.
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How-to Build the Bridge Between Boards & CEOs

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Board members and CEOs may serve different purposes in an organization, but with the right working relationship, they can help take a company to new heights. Creating a strong bond between these two entities takes time, focus, and mutual respect, but once it’s been created, the connection can be the difference between a company that just gets by and one that excels.

When it comes to getting the most out of the board to CEO relationship, here are our suggestions:

  1. CEOs should interact with board members individually and as a group.

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Avoid the Dreaded Boardroom Burnout

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The expectations for board members have been on a sharp rise for the past two decades. Companies are relying more and more on their directors both inside and outside of the boardroom, and with that dependence comes an often inevitable outcome—board burnout. Although directors at for-profit companies may feel this strain, it’s especially common among their nonprofit counterparts. Since nonprofit board roles are usually volunteer-based, it’s not uncommon for members to take early or unexpected exits from their positions. Here are some tips for avoiding “burnout” situations.

  1. Don’t take on more than you can handle.

It may sound simple, but if you can’t tackle the extra hours needed to head up a committee or act as the board secretary, politely decline those leadership positions. It’s better to stay in a less demanding role (if you still feel connected to the cause) than it is to leave and force the organization to fill a void.
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Board Communication: Is Your Solution Effective?

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Rather than investigating a forward-thinking board software product, many organizations attempt to create a “free” in-house workaround in hopes of saving on their bottom line. While this option doesn’t have a price tag directly attached to it, it does cost the organization in other ways—namely in efficiency, man-hours, and security. Oftentimes, companies direct their IT departments to set up an FTP, or File Transfer Protocol, network to act as a file sharing server for board members. These FTPs may accomplish the basic goal of delivering information, but they don’t do much in the way of bettering boardroom communication or decision-making. 

Is it efficient?

Sharing information through an FTP may seem quick and easy, but is it really efficient for boardroom processes? For instance, board books usually get updated multiple times before in-person meetings. With an FTP site, you’ll have to repeatedly load new versions of the document and then alert board members to them. With a board software solution, you can simply amend the existing board book instantaneously. Not to mention, board members can view the latest version of the board book with or without Internet access—something an FTP site is intrinsically unable to support. Continue reading

Warren Buffett’s ‘10 Commandments’ for Board Leaders

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Warren Buffett is perhaps the most recognized name in the history of American corporate governance. As the leader of Berkshire Hathaway, a multinational conglomerate holding company, Buffett has become one of the most accomplished businesspersons of all time. Because of his immense success, Buffett’s advice carries with it great weight and authority. Many of his essays and letters have been collected for publication, and he’s known among journalists for his quotable quips and reasonable advice for investors.

Recently, a George Washington University professor named Lawrence Cunningham compiled a list of Buffett’s most important guidelines for corporate directors, which was published in the latest edition of NACD’s Directorship magazine. You can read a condensed and edited version of that article here. These “ten commandments” for business leaders, as Cunningham calls them, are what Buffett cites for his vast amount of boardroom triumphs.
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Board Membership 101: The Role of the Board

Role of the BoardPresent day corporate directors are faced with increasing responsibilities, expectations, and risks. Over the last twenty years, government standards for board oversight have grown more stringent than ever as the role of the board evolves.

But why exactly do boards of directors exist, and what role do they serve in business leadership? Ultimately, boards exist to provide strategic oversight for a company and to protect shareholders’ financial interests.

In order to accomplish those goals, individuals who wish to serve on a board must be willing to take on the responsibilities expected of a director. Below, you’ll find the eight basic functions of a board.

  1. Provide strategic guidance.

Literally, board members are expected to provide the vision, mission, and goals for an organization. Metaphorically, they’re also responsible for the “big picture” vision for the company: where is it currently headed? Where does the company want to go from here?
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