Thursday, 20 Jan 2022

Kirsten Patterson: Before you wave goodbye at the exit sign

OPINION:

Many of us might be guilty of heavy-duty reliance on our devices. We use them for work, home and play, which can make it impossible to truly switch off.

As directors and CEOs we often take our work home with us. Late-night calls and emails are just part of the job, and catching up on social media – an important tool for businesses that drives engagement – is crucial in this digital landscape.

But where should directors draw the line between public and private when they have an urge to share comments, whether about their personal political point of view, making light-hearted comments about an event or circumstance, or perhaps something more serious or offensive?

Social media has proven to be a powerful tool to communicate with people from all walks of life. It’s a means to engage with new and existing customers and stakeholders, as well as friends and family. But when you’re a director that’s also what makes it potentially risky.

Being on a board means you represent and serve your organisation and that should always be at the forefront of your mind. Because whether you like it or not, what you say matters, especially if you send it out into the public domain.

Boards are responsible for setting the tone for organisational culture from the top and we all look for consistency and authenticity in our leaders.

You can’t sign off a staff policy about conduct and values one day and then perform contrary to those expectations yourself the next; just as a staff member’s behaviour outside of work can bring their employer into disrepute, a board member’s can too.

Being a director is not your usual “job” and that’s also why we see directors “resign” instead of being “fired”.

Depending on how directors have been appointed, stepping off the ladder can be the most efficient or practical solution in dealing with any conflict of interest, especially where there has been a loss of confidence amongst shareholders or other board members.

But ultimately, the decision comes down to what is in the best interest of the company.

Every member of society should feel safe to engage online without feeling abused or conversely, harming others. So knowing where to draw the line is imperative. As a director it’s important to remember that a little post can go a long way, and could even see you waving goodbye under the exit sign.

Increasing pressure for directors

There are myriad challenges for directors today, which comes with huge responsibility. So the decisions you and your fellow board members make have wide-reaching implications, both in and out of the boardroom. But strong and effective governance doesn’t come without continuous improvement, including adapting to change and unexpected circumstances.

Individuals on boards should always act in the best interests of the companies they serve and be guided by the values of that company, which drives and informs the board’s behaviour. So it’s important to make sure all members are fully aware that they must act with “integrity” from the get-go.

This means that they recognise an adherence to a set of duties and obligations – ethical, legal and commercial – that need to be met, including observing a high standard of ethical behaviour.

In this current climate, societal expectations of boards extend beyond legal compliance and as a result, any ethical failure can destroy organisational value, as well as corporate and personal reputation.

But where it gets tricky is when the lines between work and home, public and private, become blurred.

Being a leader is one thing, but demonstrating sound governance comes with expectations and increasing demand for transparency. If a director makes a misstep outside the boardroom they can quickly find themselves – and their board – under public scrutiny.

For any board, that’s not great for their personal liability, their effectiveness, or for the brand’s reputation. And no, that’s not “cancel culture” – it’s about what is best for the company. Which is why being on a board comes with an “expected level of care and diligence” which is part of committing to a board role in the first place.

Yes directors are allowed to hold personal views and to protest about issues they feel strongly about; they are individuals after all. But if your personal views and values are inconsistent or in conflict with the organisational views and best interests of the boards you represent then you need to re-think your portfolio.

So before sliding your finger towards the “post” button take a moment to pause. Shut out the flurry of emails, phone calls and noise of the day and look at those words you’ve typed beneath that glass screen. Consider whether your post is still going to give you positive feelings of warmth and delight in the cold light of day. And ask yourself if it upholds one of our longest established and enduring Kiwi values; play the ball and not the wo/man.

Because as author Toni Morrison once said, “everything depends on knowing how much…and ‘good’ is knowing when to stop”.

– Kirsten Patterson is chief executive of the Institute of Directors.

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