Governance Bites #163: effective board chairs, with Giselle McLachlan

In this episode of Governance Bites, Mark Banicevich speaks with Giselle McLachlan about what separates an effective board chair from an average one. They explore the practical framework of the Five Ts of Chairing—time, tone, talent, teamwork and tikanga (traditions)—and how these elements shape stronger board performance. The conversation covers common mistakes chairs make, building trust with directors and CEOs, preparing for meetings, encouraging balanced board discussions, and why great chairing is a skill that can be learned. A practical episode packed with insights for current and aspiring board chairs.
Giselle McLachlan CFInstD is a governance specialist dedicated to helping organisations flourish through "down to earth" advice and strategic leadership. As a Chartered Fellow of the Institute of Directors and Managing Director of Grounded Governance Ltd, she brings decades of experience as a lawyer, insurance executive, and CEO. Giselle currently serves as Board Chair for AbacusBio and ARC Committee Chair for Gore District Council and Local Government New Zealand. With a portfolio including past roles at the Medical Council of New Zealand and the Earthquake Commission, she excels at future-proofing organisations and coaching directors. She provides the fresh, honest insights needed to take the "bored" out of the boardroom.
#Governance, #CorporateGovernance, #BoardLeadership, #BoardChair, #Boards, #BoardDirectors, #Leadership, #GovernanceBites, #DirectorDevelopment, #BoardEffectiveness, #BoardMeetings, #Chairing, #GovernanceExcellence, #LeadershipDevelopment, #Boardroom, #Strategy, #RiskManagement, #NotForProfit, #BusinessLeadership, #NewZealandBusiness,
#boardcraft, #decisionmaking, #makingadifference, #ceo

Transcript

Copy

0:00

Kia ora, I'm Giselle McLachlan from Grounded Governance, greeting you from the lovely mountain town of Wanaka, which is the place I now call home. Having grown up in the North Island, now living in the South [Island] for many years, I'm really pleased to call Wanaka and the South Island my home. From here, I run a little governance coaching business called Grounded Governance. We are a small team, and we're down to earth about the way in which good governance can show up in a boardroom setting. Our aim is to make governance easier and more enjoyable. Governance isn't always fun, so let's try and enhance the experience for everybody. I think I look at governance a little bit differently to a bunch of other people, so we might talk about that, Mark. And of course I'm a director as well, myself, so I'm not just a teacher – I'm also practising what I preach, hopefully. In our first conversation today, we're going to talk about chairing well. Hi, welcome to Governance Bites. My name is Mark Banicevich, and as you just heard, I have the pleasure of spending time with Giselle McLachlan. Giselle, thank you very much for your time. You're welcome. Yeah, so Mark, one of the things I really enjoy about the work that we do at Grounded is helping people to chair boards better. This started from a conversation I had with the local community, actually. Now that I'm living in Wanaka. I said, "What can I do to be"helpful to you?" and they said, "You need to work with the chairs," because if the chairs are doing well, then everyone else will be doing well, as well. You haven't got a board that's frustrated. So I started paying attention to this, and a common complaint about board chairs I heard was,"Well, they never finish meetings on time." And I thought, well, is that really down to the chair, or is there something else going on? I spent a lot of time thinking about how to chair well, but also what are all the ingredients that go into chairing well, and we ended up inventing a model for great chairing. Can you tell us a little bit about that model? Yeah, so we call it "Chairing with Confidence". You can access it in a lot of different ways. So, one-on-one, entirely confidential, very applied to the particular situation; or small-group learning, online, where I'm helping three, four or five people at once to improve their chairing skills; or I do also deliver through Board Pro – they call the course "How to be a Great Board Chair". That's way more affordable than doing it with me, but it's downloadable content, so you download it and self-pace through it. So there are at least three different ways people can access it. But what really matters is that it's a framework, if you like, that we call the Five T's. The Five T's of great chairing comes from a piece of academic research – I haven't just made this stuff up. The research showed actually three T's which really mattered in a great chair's role. They had to be fantastic at planning and delivering on (1) time, on the (2) tone of the board, and on the(3) talent available to them. The talent, of course, includes the CE [Chief Executive] or GM [General Manager] – their relationship – but also the other board members, succession planning, all of the things that go to getting board directors to perform. The tone we all know: healthy, unhealthy, and everything in between. So the tone is in the hands of the chair, in the end. They are the safe custodian for safe conversations. And then, of course, the time: so, in meetings, that we've talked about, but also how many meetings, and what our annual work plan looks like. All of those factors come down to the chair having good planning skills and organising those things. I then added two more

T's: 4:26

(4) teamwork, that goes to committees and how we work with management; and finally, the (5) tikanga, or the traditions of the board – how do we do things around here? There's a bunch of stuff that goes into that, that the chair is again the kaitiaki, or custodian, of them. Okay. What does this framework then mean in practical terms for running, for chairing, a meeting? Yeah. So the framework's useful for a chair who's stepping into a new role, resetting their role, wanting some tools. The idea is that you work through the Five T's of "How am I"going to do this here?" And in the course that we run, you get given tools to use for each of the Five T's. We divide it into three different types of chairing: (1) chairing a meeting; then, if you look outside that, (2) what happens before and after meetings – so, agenda-setting, minutes, review, all those things; and then, past that, into (3) what happens between meetings – so, all the things that you do to plan and to coach the CE, and so on. So there's a layering of it, as well. And in all of them, the model gives a chair a way to be better at their job. Some chairs might need more of the people aspect. Some chairs might need more help with planning. Some chairs might have no idea how to sort out the tone of their board. But what I find for new chairs is they need a whole lot, and they need to have a way of organising their thinking and their doing, to feel more in control, because taking on a chair role, there's usually a lot to do. Can you, when you're observing boards, describe what are some of the common mistakes chairs make? Yeah, so, look, it's a very rare thing to get to observe a board, because when I'm in the room, they're not really being themselves – I'm not a fly on the wall. I would say, more, that through my engagement with boards, you can see chairs that are struggling with any one or all five of those T's. Sometimes they're just failing to plan – some chairs, very few, I would say, but some just take it meeting by meeting, do what they're told by management. They don't actually have a plan underpinning that; they don't have a board plan. There's a management work plan for what the board needs to do, but there's not a board plan for what the board needs to do. There are lots and lots of simple things, like not having board-only time, or not planning and executing that well. And lots of chairs definitely do this: they mistake their role for thinking they need to dominate or highly influence the board – rather than taking that role of, sort of, Switzerland, if you like, of being neutral. I think that's something that chairs can really struggle to

get to grips with: 7:34

"But I'm a director, I have an opinion." Well, yes, you do, but you don't have to tell the board what your opinion is, especially at the start of a discussion. So, yeah, that's something we go into – how to be neutral when you're actually quite opinionated, as I am, is quite a challenge. So, yeah, I would say that's a pretty good starting point for common areas for improvement. Okay, great, thank you. Now, the Five T's that you've told me about – you've got tone, talent, teamwork, and tikanga. And time, yeah. Can I just ask you to dig a little bit further into tikanga for me? Yeah. So, whether you use a Te ao Māori [Māori worldview] and Te Reo Māori [Māori language] lens of tikanga, or you look at it as traditions – we all know what those are – it's the way we do things around here. How often do we meet? How long do our meetings last for? Do we have breakfast, lunch, dinner? When do people travel? Do we go to the staff party? When do we do our site visits? How do we get to feel the organisation? When do we work with management in the room? How often do we have board-only time? All of those small tactical things add up to the traditions of this board. And, you know, when you have a new board team member, or even more than one at once – people leaving, coming on – it's a chance to reset those traditions and check in: are they still serving us well? I think one of the points of friction often is a new person joining, and the chair not taking the time to get the best out of them: what are their ideas? But also being told, "This is just how we do it, like"it or leave it." In fact, I remember once being approached about a role which I would have been, I think, pretty good match for, and they sent me through the board dates for the next year. I said, "Is there any flexibility about those,"because I'm not available for the dates you've set?" And they said, "Nope." So, okay – your traditions are pretty rigid, which probably means I'm not going to belong well there. But actually, that means your entire succession planning process is driven off who's available on those dates. Well, that cannot be – but that's their tradition. I found that really fascinating. Yeah, absolutely. That recognition that every time even one member of the board changes, you've got a new team, and you have to re-establish some of those things. That's right. That's right. So, every time somebody leaves and/or somebody joins, which not necessarily hang together, it's a new team. Yes. A question then around the chair themselves and building trust among the board. What behaviours from a chair build trust most quickly? I think time with individual people, and then, with the board, some transparency about how you plan to lead – so, what are your traditions, or tikanga, going to be? There's a really interesting topic here with

the work with the CE: 10:45

is the chair going to be the person who liaises and coaches with the CE? Chief Executive, CEO [Chief Executive Officer], whatever label the person has. Yes. And being transparent about how that's going. How does it work? How formal is it? All of those things, so that the whole board feels involved, that you're not holding on to information. That makes a massive difference, very quickly. Okay, thank you. Now, you mentioned before that it's important that the chair doesn't essentially force their opinion out, particularly too early in a conversation. What other techniques do effective chairs use to make sure that everyone's voice is heard, and they get all the opinions out? Yeah, so this goes to our tone and our teamwork, right. So, if we start relating to the Five T's, you can see how the model actually works. I'm a believer in: don't be the predictable chair who always takes turns to talk. There's

lots of research about this: 11:46

if you're a chair who, we all sit in the same place every time, and I always go to my left first, or go to my right first. That gets very predictable, and safe and unsafe, at the same time, for people. So I like to stretch people. I am really clear who I'm calling on first, but not always in the same order. I actually pre-allocate the first speaker on each board agenda item, on a board that I'm on, so that everybody gets a turn at speaking first, but they also know they have to prepare. You prepare differently, slightly differently if you are going to be the first speaker, to set the tone for the conversation. I use lots and lots of techniques – pre-meeting discussion, engagement, obviously now [Microsoft] Teams, all sorts of things. The key thing is to be fair – don't surprise people, but don't not stretch them either. We'll come back to stretching, I think. That's an interesting comment you make about pre-allocating the first speaker in each topic. I haven't heard that before, and I can see, why you were doing that, it's really great point. Especially with a board where people are really keen to have a fair crack, I think. And the other thing that's very fun, is I, just once in a meeting, might say, "Right, let's take this in"reverse alphabetical order." People love that – and then,"Which surname, or your first name, whatever" – so you can mix that up, as well. But it gives everybody a chance to go,"Oh, who's next?", and to demonstrate just how hard it is to be inclusive. Because it's very easy in reverse alpha order to forget someone, overlook. That's a really helpful little thing to remind people of. Yeah, yeah. And have fun – be a chair who has fun. Yeah. Great. What does a healthy relationship, you mentioned the relationship with the CEO before – what does a healthy relationship with the chair and CEO look like? Yeah, so, of course,

my answer to this will be: 13:50

it depends. Ultimately it's a formal, neutral relationship. I talk about the CEO engagement with the board, with the organisation, as being like a two-lane highway. If you imagine there's the formal lane – both lanes travelling the same direction, with a dotted line in between. Formal: this is the hiring, job description, remuneration, performance management, KPI [Key Performance Indicator] setting, and ultimately, perhaps, exiting. That's the formal lane. Beside it, in parallel, is the informal lane, which includes all of the navigation that the chair and CE have together – perhaps there's interaction with members of the board, on committee work, or other topics. It might be a deputy chair, might be a rem [remuneration] and nom [nominations] committee, actually handling some of that formal; and the chair handling the informal. What matters is that it is done in a respectful way that's not friendship, right. I think chairs – everyone knows the chairs are hearing more information than other board members – but they need to filter that appropriately and keep the board informed. I'll just give an

example: 15:24

this is not a real example, it's a hybrid of several real things, but just imagine you've got a chief executive who is struggling to build a great team around them – they've got people exiting, they might have people not achieving their KPIs, there might be some disquiet amongst the executive team. The chair will be probably coaching and supporting that CE quite a lot – there's quite an intensive process. But the board needs to know something about that. Not everything, but something: they need to know that this work is ongoing. What is being done to give the CEO perhaps some formal training, some investment, maybe a coach themselves – is the right answer, because the chair wants to keep it a little bit distant from this, maybe. So the board needs to know that. This healthy relationship would be, in board-only time, that the board gets good visibility that the CEO is, in some areas, struggling – not,"Oh, everything's fine, I've got this, I've got this, I'm not telling you." Yeah. Yeah. Yes. Just another question on the detail of the role, and perhaps even in contrast – what does preparation, good preparation, look like for a chair? And in particular, how is it different - Preparing for a meeting, do you mean? Yeah, preparing for a meeting. And how is that different from the preparation that other directors do? Yeah, great question. I often ask people, "When do you start"preparing for the next meeting?" And the answer is: a year ago. When you set up the board calendar, you're actually thinking about what goes into that next meeting. If we're thinking now about an August board meeting, for example – recording this in July – the meeting that's coming up in the next month, we've actually already set the rough content for that, because we've divided the work across the year, assuming you've got a functioning annual work plan. If you haven't, you've got a lot more work to think about. But

anyway. Then you'll be thinking: 17:38

next stage, so what's in the annual work plan is the first thing. Second thing is, what's also big, significant for the company for now? What were we talking about at the last meeting? And what are the issues that are going to be surfaced in this board meeting? What's the difference between decisions and discussion? For me, that leads into drafting an agenda, calling for other items to go on it, and then actually setting up the timing. I think that timing is really critical. So a chair is thinking hard about: where are my straightforward things I can just group together? Where are the things that really we need to dedicate some good creative time to? That's all done weeks, well, certainly three weeks beforehand, because then the  agenda's published. Yes. Management are writing their reports, pack goes out, the chair might be sending a little preparatory email to the board members. In my case, maybe thinking about allocating those speakers. And then, in the 48 hours before the board meeting, they've got an intensive time

to check: 18:48

from the questions you've been given, the signals you're getting, if you like, your antennae are out. The pre-meeting with the CEO – do I need to change the timing on the agenda? Do I need to actually take anything out that's just not going to work, we're not ready? And sometimes you get this – you get a bad paper, or an inappropriate paper, given the rest of the board agenda. A little bit of flex. And then you're really thinking about your own views. And this is the thing I feel, again, parallel pathway. Maybe I can think of an analogy for

this too: 19:27

another two-lane highway. I'm preparing to chair, and I'm preparing to vote. What I think about the agenda and the topics on the agenda, and what I think about chairing, are two different processes, and I prepare for them both separately. Okay. Yeah, it's quite big, actually, isn't it. Sorry. No, it is – it's understandable that it's a much bigger role. But you also want, in that position, to have a framework or an approach to follow, to achieve it. Yeah. And look, so what I actually have is a preparation worksheet that I use. I've got the agenda on one side, I've got the process notes for chairing, I've got my own views, and then I actually record the outcomes as we go through. And that works really, really well. I know from a lot of people who've done our course, that that preparation worksheet is one of the most important parts – like, "Oh, that's how you keep hold of all the threads." Yeah. Yeah, that's a great tip. Thank you. You're welcome. You parked, earlier, this concept of stretching. Yeah. Could you talk a little bit more about that, please? Yes. So, look, this is something that I quite often talk about when we're running in-person workshops, which we do. I introduce myself and say, "What I do is governance yoga," and people all look very worried, and I'm sort of limbering up, and I say, "No, no, it's not – we won't be doing actual yoga." But the idea of governance yoga is that it stretches people around the board table into uncomfortable positions. I'm not there to make it easy for them. I'm not there to – I mean, I am, in the long term, there to make it easy for them - easier = but I'm not there to play nicely. I'm there to stretch everybody, both mentally, emotionally, and substantively, in terms of delivering value to the organisation. So, whether we're doing strategy work, and actually thinking about what's the time frame for our strategy plan; or we're thinking about board culture, the things we were just talking about with chairing; or maybe we're just doing actual governance theory, and what's your role here, and how does that differ from being on management? The idea is that we bring challenge and stretch, not predictable, boring. Okay. I might ask to dig into that a little bit further another time. Yeah, sure. I've got one final question for you, to wrap this one up. What advice would you give to a first-time chair? Yeah. So I think, obviously, I'm going to advise them to do some study, right. Some training for the role. That could be that they do entirely on their own, but allocate some time deliberately to prepare. Don't underestimate how much effort it is to chair a meeting – or to chair a board team, is a better way of saying it. The role of chairing takes generally about three times longer, across the month, than being on the board and not a chair. So, if you're comparing chair and director roles, I think, people, don't underestimate that– discipline, set time aside, plan really well, and follow that Five T's model, and it will go a lot better. Giselle, that's been really great. Thank you so much for your time. You're welcome. I'll look forward to catching up again soon, and to seeing you next episode. Thank you for watching this episode of Governance Bites. We have more episodes on YouTube and your favourite podcast channel, where I interview directors and experts on various topics relating to boards of directors and governance. We'd love to see you back. And please like, subscribe, and share the videos and podcasts.