High Performance Boards, 2nd Edition

CHAPTER 21The Board as a Strategic Asset*

Boards are responsible for the long-term success of their organisations. This means that strategy must be one of the central elements of board work. Unfortunately, directors are often highly confused as to what they should and shouldn't do regarding strategy. Boards commonly place strategic responsibility on the shoulders of the organisation's executives, believing that strategic thinking is what CEOs and their teams should do. But a board taking this view often ends up acting as a mere rubber stamp of the CEO. And other boards that try to get substantively involved in strategic decision-making often find themselves clashing with the executive team. Neither approach makes sense or allows a board to add real value.

This chapter aims to clarify how boards can better assess their strategic responsibilities in order to make a truly effective and value-adding contribution to the organisation. Although national differences do matter, all boards today have some aspiration to be more engaged in strategy. The real question is how they can use their skills to do that effectively while keeping the executive team fully engaged.

A board's strategic responsibilities cannot be defined in a one-size-fits-all manner. Instead, three dimensions help to determine its impact on strategy. These are:

• The meaning of strategy – strategy can be defined in different ways and have different time frames, and board members must reach a common view on these.
• The ...