Meetings! Bloody Meetings!

Over 40 years ago, John Cleese entertained many with his training video of the above title.In the intervening time, it seems we have learned little?  There are still way too many meetings that just fail to deliver.

What’s worse, now that we have all had to become Zoom experts, we are repeating the sins of the past using the new technology.

We have to do better – for 10 top tips on reinventing the meeting virtually – and doing it better than any face-to-face meeting – click on this link: Virtual meetings, gone wrong – a guide for the bewildered!

Spare a thought for the overworked CEO

Covid has pushed us all into ‘terra incognita’ – and that is true especially for the Board.  While, before, ‘crisis management’ was regarded by some as a ‘nice to have’, Covid-19 has ruthlessly exposed those Boards without robust contingency arrangements.

Many Boards (quite practically) have increased their CEO’s ‘delegated powers’ to provide for decisive responses to the wide array of operational challenges.  But there’s a second initiative that smart Boards also attend to: ensuring that what they have delegated is being done to the Board’s satisfaction.Of course, getting the balance right between letting the CEO get on with it versus exercising oversight is a tricky balance – that’s why being ‘a critical friend’ is so importantRead more about this here: Spare a thought for the overworked CEO  

Corporate Governance and Heisenberg: a closer look at experience and expectation

I find myself intrigued by Heisenberg, the nom-de-plume adopted by Walt White, the main character in ‘Breaking Bad’.  Faced with a terrifying future (inoperable cancer and impossible healthcare costs), an otherwise unassuming high school chemistry teacher turns to making crystal meth to raise the money he needs.

When pressures are immense, we find it hard to predict how people will react.

The nom-de-plume adopted refers to Werner Heisenberg, known primarily for the so-called Heisenberg Uncertainty Principle:

One can never know with perfect accuracy both of those two important factors which determine the movement of one of the smallest particles—its position and its velocity. It is impossible to determine accurately both the position and the direction and speed of a particle at the same instant.

With that simple statement, Heisenberg instantly dismissed the goals of causal determinism – the notion that (I’m paraphrasing) once you know the rules, and you know where you’re starting from, you can always know exactly where you’ll end up.

It ain’t true for physics.  And it ain’t true for Corporate Governance.


Experience has shown how often the expectations of regulators and legislators are not met.  In a recent book “A Real Look at Real World Corporate Governance”, some disturbing statistics are provided to illustrate the point:

  • 8% of publicly traded companies each year have to restate their financial results due to previous manipulation or error
  • 10% of Chapter 11 bankruptcy cases involve allegations of fraud
  • 5% of publicly traded companies have been accused of retroactively changing the grant date of stock options
  • 26% of financial service professionals (US and UK) claim to have observed unethical or illegal behaviour first-hand.  16% say they would commit illegal insider trading if they believed they could get away with it.

We have an abundance of other examples closer to home that confirm the point.


Corporate Governance, already detailed and complex, is getting ever more detailed and complex.  What used to be an occasional sport has now transformed into a tsunami of regulation and legislation, of investigation and enforcement.   It poses a challenge to Directors, as never before, to keep on top of the expectations of them, their boards and their companies.

Take two topical examples: the imminent Compliance Statement and the latest FRC consultation on Narrative Reporting.

Our new Consolidated Companies Bill is the largest and most complex piece of legislation since the foundation of the state.  One of its provisions bound to generate debate is the resurrected (from the CA 2003) Compliance Statement.  Directors of companies affected will be required to make an annual statement in their Directors’ Report, acknowledging that they are responsible for securing the company’s compliance with its “relevant obligations” and confirming that

(a) there is a compliance policy statement,

(b) there are appropriate arrangements or structures in place to secure material compliance with relevant obligations, and,

(c) a review of such arrangements and structures has taken place during the year.

Everyone knows that the obligations under the Companies Acts apply already.  So, a statement along the lines above should not be a big deal?  The reaction to the previous attempt to introduce such an obligation (under the CA 2003) showed otherwise. Expectation versus experience.

The recent FRC paper on narrative reporting may prove no less challenging.   The FRC states:

The overriding objective of narrative reporting is to provide information on the entity, insight into its main objectives and strategies, the principal risks it faces; and to complement, supplement and provide context for the related financial statements.

Hard to argue with that?  But the previous OFR was withdrawn after heated debate and lobbying. Expectation versus experience.

Don’t get me wrong – I am not opposed to the spirit of these initiatives.  I endorse the views of the FRC CEO, Stephen Haddrill, when he stated:

We strongly believe that good governance enhances corporate performance.  A well governed Board will be clear about its vision for the business and its strategy for achieving it.  At the same time, it will manage risk effectively and be a good steward of the assets entrusted to it, all of which should enhance sustained profitability.

It would seem prudent, however, to make a conscious choice about expectation, tempering ambition on the one hand with delivered compliance on the other.  If given a choice, I would prefer more modest goals, more strictly applied and enforced, than more idealistic goals that excite a hugely varied response.  All the focus on rules and regulations gets us only so far.  Hampel summarised it well:

Process can only ever be a means, not an end in itself: it will always be far less important for corporate success and for the avoidance of disaster than having properly informed directors of the right calibre, bringing openness, thoroughness, and objectivity to bear on the carrying out of their roles

There’s no doubt that the demands on Directors have never been greater, the obligations more onerous, the expectations higher.  All the more reason why Directors must take the time to master these developments to ensure they can reasonably and defensibly discharge their duties – and be seen to do so.

(Originally published in Accountancy Ireland, September 2013)



More humility for better boards

The burden of legislation and regulation on directors has never been heavier. With more in sight. Even so, we may get no better results from boards, than in the past, unless more attention is paid to board behaviours.

In his major review of financial institutions, Sir David Walker was asked whether the Corporate Governance framework, developed painstakingly over several decades, was ‘fit for purpose’.  He concluded that it was, but added that principal deficiencies in boards of financial institutions (notably, the 2008 Great Financial Crash) related much more to patterns of behaviour than to organisation.

One of his recommendations was that ‘The chairman, non-executive directors (NEDs), executive directors (EDs) and the board as a whole should be independently assessed at appointment and annually.’  He explained that a full psychological assessment includes ‘assessment of behaviour, experience, knowledge, motivation and intellect.’

Therein lies the rub.  Ask anyone if they relish the prospect of a detailed psychological assessment – odds are they will make a face.  But if we don’t all step up and embrace these types of assessment, there is a danger we will never see the blindspots in our own performance, whose resolution is key to improved board performance.

Neither is this view purely a theoretical one: Cass Business School undertook a piece of research – ‘Roads to Ruin’ – on the most notable and costly risk management failures in recent years.  Their analysis identifies ‘Board Risk Blindness’ as one of the main causes.

In separate research, Professor Max Bazerman of Harvard identified so-called psychological  ‘blindspots’ as a serious impediment to good decision-making.

And Professor Philip Zimbardo, in his wonderfully named book The Lucifer Effect describes how the vast majority of us are susceptible to poor decision-making as a result of (now, well-defined) psychological vulnerabilities.

What to do? The advice of Alcoholics Anonymous is apt in the circumstances: the first step is to admit the problem. If we don’t all own up to being victims of these psychological filters, biases and illusions, how can we ever address them?

A no-blame culture is an essential pre-requisite to allow these psychological challenges to be addressed effectively.  What this means in practice is each director becoming aware of his own psychological make-up, and that of fellow-directors.  This enables better challenge and debate – and, ultimately, better decision-making.   There are numerous instruments and approaches that allow directors to explore this area with confidence.

The skills of the chair should not be underestimated in overseeing this process.   The ability to read colleagues’ styles and concerns can make an enormous difference to the journey that the board, as a collective, takes towards improved behaviours.

Company secretaries – as champions of governance – have an important role to play.  So too do skilled independent facilitators.

It is striking that research identifies that of many director attributes, humility is the one that declines most precipitously as individuals climb the corporate ladder to the boardroom.  What we need is more humility to address boardroom behaviours. Otherwise all the corporate governance laws, regulations and policies will count for nothing.

(from an address on board dynamics at the Isle of Man Conference of the ICSA)


And now for something completely different . . .

Since 2011, I have dabbled in blogging.  Here are links to the ones that came anywhere near completion:

Reflections on happiness
(much of this inspired by a MOOC run by the University of Pennsylvania)

From G to H – an A to Z of cycling from Gdansk to Helsinki (2015)
(the 2015 cycle trip)

From Dublin to Bordeaux (an unfinished blog of the 2014 adventure)

adventure from Vancouver to San Francisco
(the start of my Chapter 3 adventure in 2013)

Abode of Snow
(a 2011 sabbatical trip to the Himalayas)