Boards are not teams and should not be loyal to each other

As a trustee, your loyalty lies with the charity.

I spend a lot of time talking to both CEOs and Chairs in crisis. And over the years I have seen so many instances of a breakdown in the relationship between the Chair and the CEO, which almost always results in the CEO being forced to leave. However, it’s not always the case that the CEO is at fault so, where that’s true, why does this happen?

It seems to me that often boards believe that part of their job is to be loyal to each other and especially to the Chair. They see their fellow board members as part of their ‘team’ and feel they must back them up, regardless of the circumstances.

I also think things go wrong because the Board don’t get engaged in the relationship management bit. They delegate it so completely to the Chair. And the CEO is always outnumbered – the rest of the board only gets to hear the Chair’s perspective on the relationship which can be very subjective and one-sided, and the board will tend to believe their view of events rather than objectively evaluating all the circumstances.

And let’s face it in any circumstances 12 against 1 where it feels like the entire board is united against you can feel like a very bullying scenario.

This is not good governance. Your job as a trustee, indeed your legal duty, is to be ‘loyal’ to the charity and do what’s in its best interests. You are not a team required to be loyal to your fellow trustees or your Chair but to act as a collective whole in the best interests of the charity. Of course, if after discussion there is a majority line then of course you will be expected to support it but you must engage robustly in getting to the decision.

If the Chair/CEO relationship has broken down irretrievably you need to find out what has happened and consider both points of view objectively. It is not your job to side with the Chair against the CEO, but to listen to the evidence and then come to a conclusion.

And it is entirely acceptable to conclude that changing the Chair is a better option for the charity than getting rid of the CEO.

Removing a Chair costs you nothing, other than their pride and ego and perhaps a bit of a negative reaction. Removing the CEO can be a huge disbenefit with both literal and collateral financial costs associated with it, never mind the destabilising impact on the rest of the organisation. Of course, it may be that they really are at fault in which case make sure you have evidence to back it up which could win a tribunal. Above all ensure you have followed all your charity’s procedures thoroughly and documented everything very carefully.

But here’s the thing – it’s so easy to get right so you avoid the conflict! Ten tips right here:

Remember that the CEO reports to the whole Board. So, the Chair is not the ‘boss’ of the CEO. They are delegated by the Board to manage the relationship for expediency.
Evaluate your Chair as part of your annual board effectiveness review and include feedback from your Executive Team and CEO so that you get a balanced perspective – don’t just review yourselves – the Dunning-Kruger effect (the tendency for humans to over estimate our capabilities) means you will usually consider yourselves to be better than you are. You can do it anonymously if you think folk would be scared to be truthful. And a great way to evaluate the whole board’s performance is to use our free governance app www.governanceapp which is anonymised.
Make sure you are all included in the CEO annual review – contribute to the 360, say what you think they do well, less well and should prioritise (with evidence obviously!) so it’s not all just on the Chair.
Make sure all trustees have an individual relationship with the CEO by having a 1-1 with them yourselves at least once a year so that you can get to know them too.
Get your Chair to share with the whole Board a summary of key discussion points from their 1-1s with the CEO – but make sure the CEO knows what is being said so that they have a right to reply.
Remember that there are no circumstances under which a Chair can demand that the CEO does not inform the board of anything that affects the charity. The CEO reports to the whole board and has a right, indeed I would say a duty, to include them in all relevant communications (including those of a confidential nature) and you have a legal right and responsibility to know what’s going on.
Never do a performance review of the CEO alone – always make sure there are at least 2 trustees, and one of them is chosen by the CEO.
Never, ever force your Chair, by your inaction, to initiate ‘management performance’ conversations without the whole board being able to contribute their views. And separate emotion from evidence. Two people not getting on does not mean that the CEO, or indeed the Chair, is doing a bad job so don’t conflate the two.
If you have a different perspective for the love of all that’s holy say so! You are an equal member of the board – the Chair is not more important than you. And you are all legally accountable – so don’t duck and dive and hide – stick your head out of the water and say what you are thinking.
Don’t be afraid of what other board members think – there’s a very good chance that if you think the Chair is not managing the relationship well others may agree – and most good Chairs, when challenged, will be fine with it and will take on board your feedback and perspective. And if they’re not open to it… well, you now know what you can do.