I was going to call this entry "where are all the leaders going?" but I decided on another title instead. The last few days have been a whirlwind of change at the top of various organizations. GM, Air Canada, TorStar just to name a few, have ousted their CEOs and named new replacements. Some have been replaced by their Boards and others by the government. All have a common theme, their companies are significantly under-performing and they are walking away with nice packages.
It forces me to ask the question "what have these Boards been doing for the past 2 years?" Is it not up to a board of directors to assess how well or how poorly the CEO or President is managing the company? Boards have been very inactive lately in this time of economic turmoil. Why is that? Are we creating legions of ineffective boards? Maybe. That is not to say that the people on them are not intelligent, motivated people, but my guess is many board members are selected for their experience with no consideration for their willingness to make tough decisions or hold the companies accountable. A board position for a large public company has been a pretty cushy job for the last few years. Now, like everything else, that is all catching up to us.
So what do we do about it? I say cut out the dead weight. Bring in a new generation of board members that are energized and passionate about implementing change. Board chairs need to look at their board makeup and assess each member for their level of contribution and impact on the organization. Set objectives and measures and assess each of the board members. Develop a terms of reference document that is simple to follow and simpler to update, but clearly outlines your expectations of being a member of your board. Then hold them accountable. If they are not adding value, find someone that will. It is that simple. There is too much of a sense of entitlement these days and we needed a good slap in the face to recognize it. Now that we have been slapped repeatedly, how will we respond?