Conflict between the Board and the CEO

Using Conflict as a Catalyst for Change: month 4

Welcome to month four of our 2019 conflict guide for trustees. Here we take a look at how you can manage the relationship between the CEO and the board.

What happens when relationships break down?

The relationship between a charity’s board of trustees and the CEO is a fairly unique one. Each has their own respective role to play, but it is the overall team effort that keeps the charity on track and ideally takes it from strength to strength, so that it can make that all important difference to its beneficiaries and society.

The board’s responsibilities include:

  • Setting the overall strategy
  • Fulfilling its legal responsibilities
  • Maintaining high standards of governance
  • Holding the CEO and management to account

Their role is to offer support, as well as challenge to the CEO.

The CEO’s responsibility is to manage the day to day activities of the organisation and its staff, to deliver the strategy and the best possible outcomes.

What both parties should have in common is an emotional investment to the cause – all working to the same goals and doing what they do because they care deeply about the work of the organisation. That seems fairly obvious, doesn’t it? So, what are the ingredients that make for a happy partnership and why do things sometimes go wrong?

What are the main ingredients to a successful relationship?

  • Mutual respect: It is vital that both parties understand each other’s skill sets, roles and responsibilities. However, respect also needs to be earned and maintained and this is something that needs to be worked at.
  • The right sort of challenge: The role of the board is to provide an effective challenge. This must be healthy and constructive and not unnecessarily aggressive.
  • The role of the Chair: The Chair can play a vital role in setting the tone and culture of meetings and leading by example. The Chair ideally needs to have sufficient emotional intelligence to be able to work with a range of personalities and to know when a difficult conversation needs to be had or a difficult decision made.

What can cause the relationship to deteriorate?

Conflicting personalities, conflicting motives, or both may lead to:

  • Lack of understanding of respective roles
  • Inappropriate skills or knowledge to carry out roles
  • Lack of mutual respect
  • Pursuit of personal goals to the detriment of the corporate goal
  • Dominant personalities on either or both sides
  • Influence of internal politics
  • Poor or miscommunication

What to do if things go wrong

If there is a sense that the conflict between your board and the CEO is moving from the positive end of the scale to the negative, then the most important thing is to try to remedy the situation as soon as possible. The repercussions of allowing things to escalate may result in serious financial or reputational consequences, poor staff morale and the decline of the charity. A simple misunderstanding between parties can sometimes be easily put right by using an internal or external third party as a sounding board. In more difficult situations, independent mediation may help to avoid settlement agreements with CEO’s which can be expensive and not necessarily in the best interests of the charity.

The recently updated Charity Governance Code places considerable emphasis on the role and behaviours of the board and the Chair and their interaction with management. There is also a useful diagnostic tool to help charities assess how their current standards of governance compare with the Code.

Read more on Conflict between the Board and the CEO

Next month we will be focussing on the conflict between beneficiary needs and finite resources.

If you would like further information or advice, please get in touch with one of our Not for Profit team on 01903 234094.