Boards, Balance, and Better Decisions: The Traits of Effective Governance
As I prepare for the final interview stage of my Chartered Director qualification, I’ve been reflecting more deeply on the responsibilities that come with sitting at the boardroom table. One article that stood out during my reading was from the Harvard Business Review, titled How the Best Boards Engage with Management, which tackled a recurring dilemma: how can a board provide proper oversight of management while still giving it the autonomy it needs to be effective?
It’s a deceptively simple question. In practice, finding that balance is where many boards fall short. The article’s core insight, that most boards remain stuck in a single “mode” of engagement regardless of context, is something I’ve witnessed in boardrooms over the years. And it’s only as I’ve grown professionally that I’ve come to recognise how this lack of adaptability can hold a business back.
A good board is not just desirable. It is a strategic necessity.
Understanding the Director’s Duty
Despite what many assume, being a director is not about title or status. It is a legal responsibility to act in the best interests of the company. Not of yourself, your department, your allies, or even the CEO. Yet time and again, I’ve seen this principle misunderstood or ignored. It never ceases to amaze me how often experienced professionals fail to grasp the full weight of being on a board.
A board member is not there to run the company, nor to rubber stamp executive decisions. Their role is to guide, challenge, support, and, when necessary, to say no. It is about ensuring accountability and long term resilience, not short term appeasement.
Research from EY supports this, emphasising that effective boards are built on a clear mission, strong structure, and consistent self-assessment. Their framework for enduring board effectiveness highlights how board composition, operations, and decision making must align with the company’s stage, strategy, and challenges. A board that fails to evolve with its business is ultimately a risk to that business.
Traits of Effective vs. Ineffective Boards
Not all boards are created equal, and the gap between an effective and ineffective one is often cultural.
In my own experience, effective boards tend to share a few key traits:
Preparedness: Directors arrive informed, having reviewed materials and reflected on what’s needed.
Clarity: Roles and responsibilities are clearly understood, there’s no confusion between governance and management.
Constructive engagement: Members challenge each other and management, but with mutual respect and purpose.
Adaptability: They can shift gears depending on the decision at hand. Big strategic pivots versus routine oversight, for example.
In contrast, ineffective boards often suffer from:
Overreach or passivity: Either trying to run the business themselves or disengaging entirely.
Political behaviour: Decision making influenced by alliances, egos, or old loyalties.
Confusion of interests: Failing to separate personal or sectional interests from what the company truly needs.
It is also worth saying, ineffective boards tend to become obvious during crises. When the unexpected hits, adaptability and trust matter more than anything else.
The HBR Research: Boards Can’t Be One Note
The Harvard Business Review article that sparked this reflection made a powerful observation: most boards operate in a single engagement style, regardless of the decision at hand. Whether dealing with a strategic merger, a talent issue, or a financial audit, they default to the same mode – often passive or controlling.
The authors outlined four modes of board engagement:
Passive: Hands off, overly deferential to management
Mentor: Supportive but still removed
Partner: Collaborative and strategic
Control: Highly directive or invasive
The most effective boards, they found, know when to switch modes. They engage differently depending on the complexity, risk, or urgency of the situation. And crucially, they do so without undermining management’s autonomy.
This idea, that governance must be fluid, not fixed, aligns with what I’ve seen in high functioning Irish SMEs. Boards that stay stuck in a one size fits all approach quickly lose relevance. Those that can flex, however, often prove to be a competitive advantage.
Supporting this, a 2024 Deloitte survey on board practices found that clarity of role (especially between CEO and Chair), varied engagement levels depending on business size, and targeted involvement in areas like talent and risk were hallmarks of boards that added real value.
The Growing Business Viewpoint
For early stage or scaling companies, it can be tempting to treat the board as a formality, a checkbox for compliance or an extension of the founder’s vision. But that mindset often proves limiting.
A good board is a key piece of the jigsaw in a growing business. It provides not just governance, but perspective, helping leaders zoom out from the day to day and focus on long term value. It brings discipline, strategic thinking, and, when needed, a challenge to the status quo.
EY’s research also makes clear that the most successful boards are not static. They:
Build information structures that enable good decisions
Set clear expectations for behaviour and contribution
Commit to ongoing development and evaluation
That kind of board is not created overnight. It requires intention, education, and the right mix of people. But once in place, it can dramatically change the trajectory of a business.
Earning Your Seat at the Table
Serving on a board is not a ceremonial role. It is not a networking opportunity or a favour repaid. It is a serious obligation. To the business, to its employees, and to its future.
As I’ve grown in my own professional journey, I’ve come to respect this responsibility more deeply. A well-functioning board doesn’t just prevent bad decisions. It enables good ones. And that distinction, especially in today’s world, can make all the difference.
NKC works with ambitious businesses across Ireland, helping them grow through strong governance, financial insight and long term strategy. If you're reviewing your board structure or preparing for growth, get in touch with us at enquiries@nkc.ie.
Further Reading
Title: How the Best Boards Engage with Management
Publisher: Harvard Business Review
https://debestuurder.be/wp-content/uploads/2025/06/R2501J-PDF-ENG-002.pdf
Title: How to achieve enduring board effectiveness
Publisher: EY Center for Board Matters
https://www.ey.com/en_us/board-matters/how-to-achieve-enduring-board-effectiveness
Title: How boards engage on strategy, operations, talent and risk
Publisher: Deloitte & WSJ Risk & Compliance Journal
https://deloitte.wsj.com/riskandcompliance/how-boards-engage-on-strategy-operations-talent-and-risk-70e46f5d
