Let’s not kid ourselves: we’re on a bumpy road.
Rising costs, tougher competition and geopolitical uncertainty are piling pressure on companies. At the same time, the dynamics behind the doors of supervisory and advisory board meetings are changing.
For many years the roles were clearly divided: management developed the strategy; the supervisory or advisory board advised, monitored and supported.
In stable times, that model worked well. Today, though, nervousness on boards rises with uncertainty, and so does the need for control.
For many CEOs, that’s a profound change. Decisions are questioned more often, boards ask for more detailed scenarios, tighter reporting and more frequent updates. Quarterly discussions turn into monthly status meetings. A tension develops: the CEO needs room to manoeuvre, while the board has to spot and contain risks early. What one side sees as necessary oversight often looks like mistrust to the other.
It gets particularly critical when results fall short for years. Then the focus shifts from strategy to a different question: is this still the right leadership?
In our experience, many board members built their success in more stable times and often argue for caution and continuity, while management calls for radical change. The result is conflict over investment, restructuring or international expansion.
Strategy work becomes a permanent, exhausting exercise in communication. CEOs have to actively bring their boards with them. Fail to build trust and to deal openly with uncertainty, and you lose their support.
Nowhere is this clearer than in succession planning. Many boards are poorly prepared, because the topic gets put off for as long as the CEO is successful. When a change is due, there’s often no internal pipeline, and expensive external searches follow. Succession is wrongly treated as an event rather than a long-term process.
On top of that comes a kind of readiness blindness: internal candidates are often judged mainly on operational results. Strategic foresight, leadership maturity and the ability to lead through uncertainty can’t be read off KPIs.
Trust used to be a given; now it has to be built. We feel that too. The quality of the relationship between CEO and board is becoming a competitive factor, and succession planning its most important stress test.
What’s your experience with your boards?
