The High-Performance Board - Essay Example

With the right mindset, the boards focus on purpose, resources, and effectiveness through self-assessments, conducting, and acting. It requires rigorous introspection and the pitfall of implementation is the lack of knowledge about what to asses and how to apply results. The right role requires board member engagement. 

The certifying board model focuses on credibility to shareholders ensuring that the business is managed properly and CEO meets requirements. The engaged board is likened to a CEO’s partner that constantly provides insight, advice, and support on key decisions and actively defines roles and boundaries. The intervening board asserts its presence and is deeply involved in key decisions through intense meetings. The operating board decides what the management implements and is usually characterized by start-ups where executives still need more management experience. The right work requires the boards to potentially participate in dozens of distinct areas although the focus may be on legal areas such as counseling senior management, evaluating the CEO, and ensuring effective audits, among others. Ideally, the working board must also be able to provide support to directors who need help, whom to retain for the next term as well as those to release. Committees may also help them stay in focus and concentrate on specific issues. The right people on the board require competence as a group and as individuals, but in reality, capabilities mismatch expectations.

The right agenda requires the need for the board to discuss them thoroughly through annual off-site meetings beyond the regular ones where they mingle with the management and employees to gain insight as well as get fruitful results. Right information should not be too much or too little but enough to provide exact and necessary information that they need to know and discuss.  The right culture engages the board with candor and willingness to challenge as it reflects the social and work dynamics of a performing team (Nadler, 2004).

The Principles of Good Governance and The Seven Practices

Lawrence and Weber (year) prescribed five principles of good governance for the board through a selection of outside directors to fill the majority of positions, conducting open elections for members of the board, appointing an independent lead director or chairman of the board and holding regular meetings without the CEO present, align director compensation with corporate performance, and evaluate the board's performance regularly. The overlap between the lists of Nadler and Lawrence and Weber is that Lawrence and Weber’s list encompassed Nadler’s right mindset. Nadler’s is more encompassing, extensive, and specific while Lawrence and Weber’s were traditional at most.

Executive Pay and the Principles of Board Practices

Through the right people method, Nadler’s practices may eliminate those who are performing questionably, thus maintaining performers that may be threatened by the competition. In addition, transparency and equity are also promoted to determine that it is not only senior management or executives that monopolize compensation but must be distributed equally to all members of the organization as one component should be determined as important as the others. This will help distribute compensation from the executives down to the rank and file (Martinelli, 2011).

Board Performance and Application to Disney

One of the bigger problems of Walt Disney may be its large operation in terms of products and services, locations, and employment. It is one of the world’s top entertainment multinational companies that has also diverted into real property development with its theme parks. Governance is a major challenge for MNCs like Walt Disney. The board may provide coherence through this limited body by being immersed in the challenges and existing work cultures in the MNC. But first, its board also needs to determine that the right people are in it. Walt Disney may reform its board through an assessment of the roles of the board directors, determine the right people to retain, elect, and release, and a need to adopt the right agenda through extended discussion and insight-gathering of the corporate culture to determine needs, expectations, and implementation of changes or developments. Read More