One Minute Governance

238. What are three things we wish management would explain to us in greater detail?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #36: What are three things we wish management would explain to us in greater detail? Without looking, what do you know about the appendix? As in, the little tube jutting out of most humans’ large intestines. I’m willing to bet that if I sampled 100 people listening to this episode, the only appendix-related knowledge that we all have in common is that sometimes something can go really wrong with a person’s appendix and it has to be urgently removed. I have a suspicion that for most boards of most corporations there are a few things about the business where the board’s knowledge is kinda equivalent to most people’s understanding of the appendix. Some of us might know a lot about it – maybe because we had acute appendicitis and learned it all the hard way. Like a director who may have gone through a crisis and was forced to learn all the nuts and bolts about some weird law or regulation. The rest of us might have *heard* of that law, and understand implicitly that breaking it is bad, but not have any idea if or how it might apply to THIS corporation. Same thing goes for companies with super complex operations. There are probably some things about the way your company works that you know are important, and that management refers to occasionally, but that nobody ever took a second to step back and say, “hey, I think I’d like to know more about that. It seems important!” I bet you can think of three things that fit that bill. Better to know now than after your appendix has burst.

237. What are three things we wish management would explain to us in simpler language?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #35: What are three things we wish management would explain to us in simpler language? Nothing could be more appropriate than the actual 100% true fact that I wrote the script for this episode while listening to a compilation of Curtis Mayfield’s greatest hits. The greatest hits aren’t as satisfying as, say, just listening through the album Curtis top to bottom, but still. As for the relevance to this episode, if you know you know. On a similar note, episode 129 of OMG was called “Is Thing Explainer the best management book?” In other words, everywhere you look there are great examples in the world of people communicating complex information and ideas in simple and impactful ways. You won’t find many of those examples in materials prepared for boards of directors. Which is fair, I guess. We’re conditioned to believe that if we leave out the jargon and exhaustive details then we’re probably failing to comply with some arcane rule somewhere. And in some cases that might be true. That said, just receiving all the jargon and exhaustive detail doesn’t guarantee that the board will, y’know, get it. I am confident that if your board explores today’s question together you will come up with some really useful answers, and everyone will be grateful. For the executives listening, feel free to use Thing Explainer and Curtis Mayfield as inspiration once the board shares their answers.

236. Are we sure we use our experts well?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #34: Are we sure we use our experts well? It goes without saying that you can’t just stick a bunch of smart people in a room together and expect them to get along, let alone to make patient and well-informed decisions together. Things get even worse when those people aren’t just smart, but also have serious depth of expertise in areas that are directly related to the decisions that they need to make. Add to that the time scarcity and information asymmetry that are unavoidable characteristics of the work of a board and, well, we basically have the perfect illustration of why I think good governance is intentionally cultivating effective conditions for making decisions. If we’re not intentional, then our experts will be set up…not to fail, exactly, but certainly not to be as awesome as they could and should be. Just turning to an expert and saying “hey, you’re a pro at this, what do you think we should do?” is opening the door for the overconfidence effect that we talked about last week in episode 235. Just leaving things to chance and hoping everyone engages in the right way at the right time is, well, I suppose it’s the opposite of being intentional and also unlikely to succeed. It turns out that we need to understand not only the nature of each person’s expertise, but also a bit about their personality. We need to have a clear sense of what conversations we need to have (shout out episode 218). We need a sense of what insights management needs from the board. And once we know all that, we’re ready to flip today’s question a bit and ask: what do we need to do to make sure we use our experts well today?

235. What's at the top of our expertise wish list?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #33: What’s at the top of our expertise wish list? It’s been a couple of months since episode 207 where I urged you to consider what, specifically, makes a director great. I have asked *many* directors and executives that question and they have never, ever, answered by listing areas of expertise. And I think that makes sense, right? There’s no type or depth of expertise that, on its own, might make someone a great director. But that doesn’t mean we don’t need experts. In general, we’ve been conditioned to believe that the table stakes for boards include things like legal, audit, finance, strategy, executive experience, and so on. I could easily make a strong case for all of those. Without much more effort, I could make a case that they’re expendable. It’s also tempting to zoom in on emerging topics like AI or cybersecurity or DEI or modern slavery or whatever. Also all good options. And if we get an AI expert who’s also a great director who could possibly deny we’ve accomplished something important? But there are only so many seats at the table and we can’t tick every expertise box. And sometimes we might actually want TWO experts in the same area, right? So they can validate each other? I guess what I’m saying is that all expertise is optional, so if we’re resisting the urge to anchor to the status quo what would be at the top of our wish list? If we could add precisely one new area of expertise to our board, what would it be?

234. How might we empower our loudest directors to be better listeners?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #32: How might we empower the loudest directors to be better listeners? Having an ultra-confident expert on a board is a blessing and a curse. I suspect I don’t really have to explain what I mean – it’s pretty obvious. I mean, confident expertise, when the expertise is relevant to the work of the board, is a shortcut to managing information asymmetry and ensuring the board is able to be, y’know, useful. But there’s a very fine line between high confidence and OVERconfidence. Overconfidence is dangerous. I talked about this back in episode 119, and there’s tonnes of cool stuff you can read about the perverse relationship between expertise and confidence by Googling “overconfidence effect”. The other issue with confidence is that the most confident people on boards are the ones who will most readily participate, and will feel most uncomfortable with even the briefest breaks in action. But think about those of us in the room who have less expertise, but whose perspectives might still be critical to making sure we consider our decisions most thoughtfully. We might need a few more seconds or minutes to think. We might need a bit more information. We might not have the confidence or footing to challenge the experts in the room. The moment those experts start getting expert-y, the quieter among us will be more likely to just defer. And that’s a missed opportunity for everyone. Even our experts would be better off having more perspectives to consider. So, what approaches might you try to empower your experts to be listeners first?

233. How might we empower our quietest directors to make an impact?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #31: how might we empower our quietest directors to make an impact? There’s a surprisingly common and patently absurd notion in the world of boards and corporate governance. It goes something like this: when we recruit a new director, we don’t really expect them to contribute much in the first year – mostly we want them to listen and learn. Most of you OMG listeners will be familiar with this position, and already know that it’s kinda dumb. Because here’s the thing: board seats are scarce. Precious, even. Why the heck would you be OK with one of those seats being filled with someone who’s not empowered to engage, participate and contribute on equal footing with the rest of the board? A much less dumb approach to a new director would be to ask yourself, “what would it take for this new director to participate at 100% from day 1, and how are we going to do our best to make sure that it’ll happen?” Now think about the quietest director at the table, whether they’re new or not. Most of the boards I meet are sitting there wishing that director would say more and participate more willingly. Well, what would it take for that director to participate more, and how are you going to do your best to make it happen. Spoiler alert: just pointing your finger at them and asking them to participate isn’t going to get it done. Don’t be lazy. Do the work.

232. How many of us wish our work were more spontaneous?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #30: How many of us wish our work were more spontaneous? I admitted in the last episode – to nobody’s surprise, I imagine – that I generally prefer the unpredictable over the predictable. That doesn’t – and shouldn’t – mean that anyone else should feel the same way. But it does mean that in a generally super-structured environment like a board meeting, one of two things is happening. One, I am trying my best to be useful, but am never really able to give my best. Two, I am subtly or unsubtly pushing for cool stuff to happen, thereby annoying the structure-preferring people in the room. And they’re right to be annoyed! If the meeting were in a spontaneous and experimental mode, our positions would be reversed. They’d be less useful than they could be and probably subtly struggling to rein in the chaos. But this is actually a good explanation for why we generally struggle to get the best out of everyone at the same time. The fact is that no one approach or model will be well-suited to the wide range of personalities and preferences in the room. And for what it’s worth I can *guarantee* that there is a wide range of personalities and preferences among your board members and executives. Do I have a brilliant suggestion to address this challenge? No. But again, you can’t solve a problem that you can’t describe. So ask the question!

231. How many of us wish our work were more structured?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #29: how many of us wish our work were more structured? Ever notice how lots of people get uncomfortable the moment things get unpredictable? It’s both normal and understandable. And thankfully, most boards and executives approach their work together in a pretty structured and predictable way. But that can make it even more jarring when something unexpected happens, or when someone in the room starts suggesting (or insisting) that we try something new. Even though I personally feel more comfortable in situations that lean toward the unpredictable – at least most of the time – I think it’s obvious that there’s nothing right or wrong about preferring structure. And I bet you can picture how someone’s preference for structure and predictability might affect the way that they engage in discussions at a board meeting. As long as we’re sticking pretty close to the scheduled topics and not introducing any significant new information, they’re right at home. But instead of making an assumption that anyone – or everyone – is happy with the balance we have, why not ask? What if it turns out all of us would prefer to increase the predictability of our meetings? Wouldn’t that be an important bit of information?

230. How many of us would benefit from an occasional change in scenery?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #28: How many of us would benefit from an occasional change in scenery? In episodes 192 and 193 of OMG I talked about the importance of breaks and physical movement. These are not trivial nice to haves – they are critical to making sure that people are cognitively engaged and comfortable – both of which we can all agree are important to board effectiveness. Speaking of trivial, it’s maybe a bit too easy to trivialize breaks and think of them just in terms of gaps in our agendas for people to do with what they please. Mostly to grab a coffee and get caught up on email for 15 minutes. But we all know that that’s no break at all. It’s like if I giftwrapped your overflowing work phone and presented it to you like the greatest gift in the world. No, breaks are different from simple agenda items. If you could design the ideal break – one with no constraints, anything is on the table – what would it look like? We might all come up with something different, but I suspect almost everyone’s dream break would include a change in scenery. Maybe you’re out on a walk or sitting on the beach or up on a roof or on your bike or whatever. And the thing about a change in scenery is that you don’t even need a break to get it done. You could hold different parts of your board meeting in different rooms or have a quick walk and talk or even just play musical chairs. So, how many of us would benefit from an occasional change in scenery?

229. How many of us would like our board meetings to be more creative?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #27: How many of us would like our board meetings to feel more “creative”? As any casual OMG listener will already know, I spend a lot of time encouraging corporate directors and senior executives to do things that are outside of the range of normal behaviours in boardrooms. First off, I’d like to argue that the range of normal behaviours in boardrooms is way too narrow and doesn’t work very well. But second, I am compelled to admit that it can be hard to find the confidence to try things that literally nobody else has ever tried, even when everything that everyone *has* tried doesn’t work. To that end, I often get challenged by my clients and students on that exact point, usually in the form of “that all sounds fine, Matt, but how do you expect me to go into my boardroom and actually do this stuff?” My initial response often involves the subject of today’s episode. I will look around the room and say, “OK, raise your hand if, in general, you would like your board meetings to feel more creative, whatever that means to you?” Every time I’ve asked this question, more than three quarters of the people in the room raise their hand. And what I’m try: first, that we are all open to trying new things and as a result you probably won’t face as much resistance as you think. Second, just asking a show of hands question requires basically no permission, gets you immediate and valuable information, and in itself injects a bit of active and creative engagement into the flow of a meeting. Creativity doesn’t have to be difficult or complicated or transformative. But it does have to push you outside the range of normal behaviour.

228. How might subtraction help to solve our stickiest problems?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #26: How might subtraction help to solve our stickiest issues? Back in episode 189, I talked about the amazing work by Leidy Klotz and others on a cognitive bias called “subtraction neglect”. Basically, subtraction neglect describes that our brains find it really easy to consider solutions to problems that involve adding stuff and really hard to think of solutions that involve taking things away. Unlike most cognitive biases, we can short circuit subtraction neglect just by asking “how might we solve this problem through subtraction?” So that’s what I’m urging you to do in today’s episode. Think of a typical board meeting – and I don’t care if your meetings are one hour long or three days long – I think it’s safe to assume that you discuss approximately two important problems per hour. Maybe more, maybe less, but two-ish on average. Every single one of those problems will be compromised by subtraction neglect. Even more important are the problems that you’ve put up with forever – maybe you even assume they *can’t* be solved. Things like information overload or getting stuck in the weeds or whatever. Instinctively, we can see that trying to solve those problems through addition could sorta work, but will probably unintentionally make things a bit worse. But if we get into the habit of asking “how might we solve this problem through subtraction?” We’re opening ourselves to a whole new world of ideas.

227. Is our pain really necessary?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #25: Is our pain really necessary? In the previous episode, I admitted that work sometimes sucks, and the work of a board is no different. Despite the fact that we can never completely avoid or alleviate the pain of board work, that doesn’t mean we shouldn’t try. So now that you’ve identified and described your pain points, the next question is whether we really have to suffer, or if there might be a different path. The fact is that almost everything that boards do is optional. In other words, the list of specific activities that a board *must* perform is short. Now, there’s tonnes of optional stuff that boards *should* do to make sure that their butts are covered and that they feel confident they’ve discharged their duties. But even here, the range of approaches that boards take to discharging their duties is strangely narrow. Making matters worse, boards have a tendency to want to model themselves after each other. Whenever they need to do something new or different, the first question is “well, what are other boards doing?” The answer, I’m afraid, is “nothing very interesting.” What I’m getting at is that a lot of your pain might be unnecessary, but you’ll never find out if you’re not open to ditching some of the optional stuff and resisting the urge to seek validation from other boards. As long as you’re complying with laws and regulations, I think it’s worth experimenting with novel approaches to pain relief.

BONUS: Matt's Australia/New Zealand Roadshow

Check out Matt's tour schedule here: https://ffm.live/MattinOz

 

TRANSCRIPT:

Hi everyone. Matt Fullbrook here. This is a quick bonus episode of OMG to spread the word to everyone who follows the show that I’m going to be in Australia and New Zealand next month on a bit of a roadshow. Over the course of the month, I have stops in Brisbane, Auckland, Melbourne and Sydney (in that order) with events tailored for everyone from students to board chairs to CEOs to generally curious nerds. There are breakfast events, cocktail events and casual dinners. If you’re going to be in any of those places in October, or if you know anyone who is, check out the link in the show notes for an evolving list of dates, including links to get tickets or submit RSVPs. If you’re hearing this, I assume it means you’re a fan of the show, and if you like OMG you’ll really enjoy all these sessions. Thanks for checking it out and spreading the word. Hope to see you down under.

226. What are the most painful elements of our meetings?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #24: What are the most painful elements of our meetings? The work of a board is, well, work. And for almost all of us, work sometimes sucks. The fact that work sometimes sucks is not an indication that something is wrong. It’s just often a fact of life. As long as it also doesn’t suck – preferably most of the time. So, with that out of the way, board meetings are sometimes painful. Different parts of board meetings might be painful to different participants. For example, what’s painful for the board is often less painful for management and vice versa. But in almost all of the cases I’ve encountered, there are parts of board meetings that are painful for everyone. Maybe it’s the times when we pull something out of consent agenda. Maybe it’s the presentations by that one executive who’s just kinda boring. Maybe it’s every time that jerk – let’s call him Matt – opens his mouth and goes on and on about some nonsense. Maybe it’s the sheer quantity and weight of the compliance burden we face. Again, I’m not saying that the pain is necessarily bad, and I’m certainly not trying to imply that I know how to relieve all your pain. But if pain relief is to be found, we need to start by naming it.

225. What might *I* do to make things a bit better?

This season, every episode of OMG focuses on a question that directors really need to answer.

OMG is written, produced, narrated and scored by Matt Fullbrook.

 

TRANSCRIPT:

Question #23: What might I do to make things a bit better? Conventional definitions of corporate governance frame it as something that exists: a system of processes and structures that promote transparency and accountability or some other such nonsense. Nonsense because it leaves us with the impression that corporate governance isn’t something that actual people actually do. There’s a similar problem with thinking of corporate governance only as a thing that belongs to the board, as a whole. As in, nobody other than the whole board collectively might have any impact on corporate governance. A weird implication of that framing is that it obscures the fact that individual directors matter. Personally, I believe that an individual director or senior executive can cause good governance to happen. This won’t surprise anyone who’s followed this show for a long time, but when a single person is intentional about the conditions that affect our decisions, that person is literally doing good governance. Just them, on their own, doing good governance. So, what might *you* do to make things a bit better?