How does the culture of the board affect company culture? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.
The culture of a company's board can both shape and be shaped by the company's culture. A well-functioning board will rarely be found presiding over a poorly run company.
What makes a well-functioning board? A long list would include a mix of skills, characteristics and behaviors including the right balance of relevant skills required (including risk, financial management, marketing, industry knowledge etc.), personal and collective accountability (often expressed in something as simple as attendance with advance preparation), perspective (which is not the same as years of experience in an industry but something drawn from observation, analytical abilities and synthetical intelligence), sometimes skin in the game (this may not always be required or desirable e.g. non-profits and educational institutions prefer that people serving on the boards do not have related parties as employees or beneficiaries) but above all, independence of thinking, and directness.
If asked for one characteristic, I would say, "a good board culture is when nobody is affronted by a question being asked."
That sounds simple but it really is the crux of how details are probed, how divergent narratives are clarified and reconciled, how scenarios are discussed, and how calamities and risks are anticipated and their mitigation visualized and planned.
A board with the culture of openness and direct questioning will not get along well with a company full of secrecy, intrigue, cooked-up books etc., where the executives actively seek to mislead or lie to the board, as .
A board that continually asks questions, arising from its perspective, anticipation of risks, a commitment to the duty of care and of independence, and accountability, will likely not be a board that accepts just any answers being peddled. In other words, such a board would not tolerate a culture of lies and toxicity, and will likely use its powers to bring about changes in the executive group, instead of letting the poor culture persist.
It is not linear, simple, or sometimes without drama. But almost always, an alert board, an engaged board, will be instrumental in shaping the culture of the company whose shareholders' interests they are stewards of.
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