With the abrupt shift in working arrangements experienced by most organisations borne of COVID-19, questions are showing up regarding the role of management in effective business performance.

For instance:

  • How do supervisors / middle managers develop their more junior home-based staff beyond confirming that they’re spending the requisite amount of computer screen time?
  • What happens to organisational cohesion when businesses operate with two classes of people: those who work remotely and those who turn up on the premises?
  • How do new starters in an organisation get to know “the way things are done around here” in the absence of behavioural cues?


Of lesser focus – except perhaps in relation to major financial institutions – but equal importance is the role of effective governance in enabling businesses to stay on track in stressful times.


As with management, there is both art and science involved in Boards of Directors providing effective business Governance.


First the science. Corporations Law provides many words that define and describe Corporate Governance requirements. In essence though the functions of a Governance Board are:

  1. Implementing business stewardship frameworks – covering risk management, internal compliance and control, codes of conduct, legal compliance and reporting
  2. Formulating business goals and strategy in consultation with operational management
  3. Monitoring organisational performance in accordance with performance measures and benchmarked against peers
  4. Raising the external profile of the business to assist in achieving organisational objectives
  5. Dealing with responsibilities to other stakeholders.


The first item in particular requires further exploration. Effective business stewardship comprises the Board determining the “box” in which the business operates. In practice, this looks like:

  • A Board that focuses on “ends” rather than “means” when formulating policies about delegation, for instance, limits in relation to budget authorities, cost/benefit hurdles in relation to investments etc. However, Boards may also need to specify management means that are off limits i.e. the Board looks to adopt boundary setting policies rather than prescriptive policies.
  • By imposing executive limitations, a Board builds an enclosure within which freedom, creativity and action are allowed and even encouraged. In this way the Board defines where its role ends and where management starts.
  • The real value of a Board lies in its ability to look at issues from a different perspective to the management team, and to make its collective knowledge and experience available to the company. An effective Board questions and offers insight into management activity or inactivity.


So what is the Board’s role in disruptive times like these, when external circumstances have the potential to render companies out of business virtually overnight?


The art of effective Board input is in being able to tap into the health of the business beyond the financial reports. This becomes much more difficult in the current environment as restricted access to people results in information funnelled almost exclusively through the lens of senior management. In these circumstances, the ability to constructively challenge what’s being presented becomes critically important.


Conversely, Board Members have a real opportunity to bring an external perspective to management in circumstances where people may feel they have no time to lift their heads. Looking out for red flags such as anxiousness provides a great opportunity to have a conversation about what’s going on out there of specific concern to the business. A much better use of time than generally worrying about what may or may not happen…