One board member angrily complains that an letter improperly solicited the members of their organization. Accusatory emails shoot back and forth and the temperatures of the Board members and CEO begins to rise.  “This was the old way of handling problems,” one board member comments.  However, they had recently implemented a new way of governing and it was time for its first test.

In Policy Governance, there is a specific approach to addressing problems which prevents situations from spinning out of control.  Here is how this organization addressed the emerging problem and prevented a crisis.

The President and the CEO acknowledged it was a real issue.

Policy Governance creates a system by which the Board can control the organization without micromanaging.  Well thought-out systems are important, but a board is a human system comprised of people and their feelings.  By telling the aggrieved Board member that the problem is being taken seriously and is being addressed directly, they buy themselves time to deal with the issue in a meaningful way.  The challenge is to appropriately follow through so that the Board provides direction without usurping the CEO’s authority to run the organization.  That’s where Policy Governance comes in.

Has the Board Already Prohibited Such Action?

The Board had created a list of problematic situations that they wanted the CEO to avoid, such as treating their members unprofessionally, financially imperiling the organization, etc.  This list became the basis of the Board’s policies prohibiting the CEO from allowing these situations to transpire.

The President, the CEO, and the agitated Board member talked about what had actually happened .  There was no question that the CEO had the right to send a solicitation in the name of the organization.  There was also no expectation that the CEO needed to read the minds and sensitivities of Board members or individual members of the organization regarding sending out solicitations.  However, in their discussion, they revealed an area of sensitivity that the President and Board member thought the CEO needed to consider.  However, the President and the single Board member do not have the authority, by themselves, to tell the CEO what to do or how to do it.  Only the Board, as a whole, can do that.

The Board checked their policies to see if this particular situation regarding the solicitation of certain members had already been barred.  If it had, the CEO had some serious explaining to do.  In this case, the Board had not prohibited this type of action.

Fashion a Policy; Board Approves

The Board Chair, with input from several Board members and the CEO, created a policy that prohibited these kinds of situations in the future.  The President brought the policy to the Board which discussed and ultimately approved it.  The Board recognized that the CEO had the authority to take this action in the past, but they thought it was in the best interest of the organization as a whole to slightly limit the CEO’s authority in this one, narrow area.

Monitor, Monitor, Monitor

Then the Board directed the CEO to provide information at a future meeting that the policy is being followed.   This gave the aggrieved Board member even more confidence that her issues were being taken seriously and the needs of the members, whom she represents, were being well represented.  In Policy Governance, the Board monitor every one of its prohibitions each year, if not more, to ensure that the CEO is acting in accordance with the Board’s directions.

Strong Governance Systems Prevent Crises

Dealing with aggrieved members is a typical problem that can blow up into a serious crisis.  If the challenge is handled poorly, it can leave residues of hurt feelings and mistrust that undermine the strength of all of the leadership.  Policy Governance provides a coherent and robust system that clearly defines the roles of the Board and CEO and creates a roadmap for constructively addressing all governance circumstances.