At GUBERNA, we identified the increased attention for the human factor in boards as one of the trends of the Covid-year 2021 in academic research and media reporting. Our GUBERNA Summer School of 2021 translated this theme into a focus on board dynamics. Together with our participants, we studied the multiple levels and ways that board dynamics impact decision-making and thought processes. We received input by international speakers and exchanged experiences.
We also presented the results of a study on board dynamics amongst Belgian directors. The study was based on a questionnaire for which we reached out to our GUBERNA members. We asked the respondents to reflect on 22 statements and to indicate how applicable they consider them to their boards. The answers on the questionnaire gave us insights in the board dynamics and the wellbeing of Belgian directors. In total, we received 89 valid questionnaires that were analysed in our framework.
We reached 5 conclusions that were discussed during our Summer School:
- Overall, the boards of our GUBERNA members score well in board dynamics. The statement: “All decisions are taken in the interest of the organisation” received the highest score: the respondents indicated that they agree with this statement. As it is an essential condition for a well-functioning board, we are happy that the boards of our GUBERNA members hold it in high regard.
- Conflict is avoided. Compared to the other statements, the statements about conflict consistently receive a lower score. The balance between a good discussion and an unfair fight is perhaps not always clear or delineated, and the fear for unjust hostilities seems to hinder the necessity of thorough, outspoken argumentative discussions. Accordingly, there is a risk on pressure to follow the majority and a fear for expressing a deviating opinion.
- Our respondents confirm that size matters: compared to directors from smaller boards, those from larger boards indicate that they are more susceptible to fear of voicing their opinion and that there is more pressure from the majority.
- The Belgian Code 2020 has an effect: in listed companies, the decision-making process is more formalised and is therefore considered as clearer.
- The pressure of the media and the shareholders is felt more deeply by chairmen rather than by other directors.
We advocate professionalism in board dynamics: high norms and standards are the first step towards creating a climate of trust and positive interactions. This climate is vital to come to an engaging and constructive debate, without fear for possible challenges. The decisions that follow such discussions will ideally be shared by everyone of the board and will make the board stronger and resilient for future challenges.