Corporate Governance
Board relationships with management
Corporate board directors rely on senior management for accurate, timely information on the company’s strategic initiatives, risks, controls, and challenges. In turn, management relies on directors for wisdom and judgment gained over years of business or other experience.
To establish and maintain productive, working relationships with senior management, boards and committees have adopted practices designed to improve communication, foster trust, and promote cooperation. They encourage organized, purposeful meetings that surface dissenting opinions and move discussion towards a meaningful end. They use executive sessions to understand the key challenges and priorities of senior management. Outside the boardroom, directors often seek deeper relationships with executives through informal meetings.
A key challenge for the board is maintaining its objectivity while building strong relationships with management. Directors should courageously and persistently challenge management’s thinking, while recognizing the distinction between providing management and oversight.
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