Chairman & Chairwoman: Here is the one ability that makes all the difference
Chairmen today are wrestling with an unprecedented array of challenges on multiple fronts. Activist investors demand drastic, immediate results to boost profit margins. Regulators around the world impose costly new requirements and expose Chairmen to embarrassing publicity for compliance failures. New competitors and rapidly evolving technology upend market dynamics and undermine established business models. All the while, an expanding chorus of social and traditional media outlets call out Chairmen and Directors for failing to meet expectations.
The recent revision of the guide for Boards has put the spotlight on culture and behaviours. Chairmen are challenged creating a climate characterised by interpersonal trust and mutual respect in which Directors are comfortable being themselves, speaking up, asking challenging questions, admitting errors, discussing problems and offering innovative solutions. In some environments, people perceive the career and interpersonal threat as sufficiently low that they dare to be themselves. Boards are not such an environment. The stakes for all members are high. More than that, being a member of a Board is part of the whole identity. Where so much is at stake, it is well documented that people tend to act in ways that inhibit learning and all the behaviours that are deemed to be desirable for members of a high performing and effective Board.
Chairmen are challenged to create an environment that allows for all the desired behaviours to flourish. The environments that work best are those that provide high levels of Psychological Safety.
Psychological Safety in the Boardroom is the shared belief of its members that the Board is a safe place for personal risk-taking i.e. a place where they can work freely without any anxiety or fear of retribution to their career, status, and self-image.
The ability to make the Boardroom a psychologically safe place is the key to a successful Chairmanship and the one item that makes all the difference. The most successful Chairmen create psychologically safe Boardrooms naturally. We believe that they and all other Chairmen can be even more successful by fully embracing the concept of Psychological Safety and consciously think about further actions they can take to provide a psychologically safe Board environment.
The evidence from academic studies is compelling. Psychologically safe team environments encourage and enable people to engage in risky interpersonal behaviour and lead to greater:
- Engagement, commitment and empowerment;
- Performance at the individual and team level;
- Learning behaviour;
- Risk-taking;
- Interpersonal communication;
- Willingness to raise disagreement;
- Knowledge sharing and highlighting of failures/ errors;
- Feedback giving and seeking behaviour;
- Creativity;
- Innovation and knowledge creation;
and last but not least, successful implementation of new technology.
What struck us when analysing the results of more than 85 academic studies is that psychologically safe team environments bring to life all the desired Board behaviours and those that are highlighted in the revised guide for Boards.
So how can Chairmen create psychologically safe Boardrooms?
Harvard Business School Professor Amy Edmondson’s original research identified five elements that affect team psychological safety, and Chairmen can draw on:
- The leader’s behaviour;
- Trust and respect between the team members;
- Organisational support;
- Set of habits and routines that team members develop amongst themselves;
- The opportunity for the team to practice and improve their tasks off-line without an immediate impact on their actual work.
In our experience with high performing Boards, we have observed behaviours that inspired the list of behavioural tweaks and actions you can take. We have organised them under the five elements that affect team psychological safety.
The leader’s behaviour:
- Expose some of your imperfections.
- Cultivate a curious attitude.
Trust and respect between the team members:
- Invest in understanding and acknowledging the strength of each member of the Board.
- Draw out the perspectives and opinions of all members of the Board.
Organisational support:
- Provide space in the annual calendar for social activities.
- Offer access to key people and teams in the organisation.
Set of habits and routines that team members develop among themselves:
- Rotate the role of the devil’s advocate.
- Support brave action and encouraging field outings.
The opportunity for the team to practice and improve their tasks off-line without an immediate impact on their actual work:
- Provide personal development opportunities for the members of the Board.
- Encourage experimentation with desired behaviours outside the Boardroom.
Psychological safety is not just a concept for teams at the bottom of the hierarchy but paramount for high performing and effective Boards. The ability to make the Boardroom a psychologically safe place is the key to a successful Chairmanship and the one item that makes all the difference.
Dr Sabine Dembkowski is Managing Partner of Better Boards, www.better-boards.com