In Board Performance, Governance

Boards and Mission Statements

I often find myself in conversations with board members who ask about the vision or mission statement. What strikes me is how many members treat this notion as if it has an obvious answer: it is the board’s responsibility.

But here is the challenge. How often do board members actually ‘work’ at the organization? Once a quarter? Once a month? There may well be reading materials once a month and maybe even meetings every other month. But really that does not constitute actually working there on a daily basis.

So it is fair to say that this is a critical governance question. Who should take responsibility for the development, evaluation and approval of an organization’s mission?

On the one hand, most people recognize that the job of a board is to provide direction to the organization via the senior management. On the other hand, there is also near universal agreement that it is important for directors not to micro-manage the corporation by taking on the roles and responsibilities of management.

So where is the line in this grey area and how does one manage the mission or vision statement? And how does strategy fit in here?

Metrics or Impact?

In my view the board is ultimately responsible for making sure the organization meets the outcomes expected. Those may be community engagement. Or a satisfactory return to shareholders. Or a material improvement in the lives of a certain identified group. The board can do this by having a governance model that stays focused on this level of thinking.

Think of the ‘impact’ this organization is having.

Management on the other hand, is responsible for performance against those expectations. That is, they are charged with delivering results. That means on a daily basis they are working inside a strategy that enables them to meet the deliverables. A strategy is simply a framework for the operation to exist in, and make decisions against.

Think of the ‘metrics’ this organization is delivering.

And that means that the mission or vision statement is a management tool to enable the organization to deliver its ‘metrics’. It is not a board tool that enables an ‘impact’.

 

In the end I would argue that the mission statement is the management’s responsibility and the board should hold the organization accountable for the impact that statement has in the wider world.