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2015 is shaping up to be a year where boards, once again, will be under intense pressure and scrutiny to get it right. Here is a list of trends and key issues, along with what boards are or should be doing in response.

1. Greater Director and Advisor Independence

Pressure:
A director or professional advisor can be formally independent, and yet captured inside the boardroom. Forms of capture reported to me include social relationships, donations, jobs or contracts for friends, perks, vacations, office use, director interlocks, supplier or customer relations, and excessive tenure and compensation. Look for more regulators implementing term limits and moving towards an objective standard of director independence. Look for activists going into the background of directors to demonstrate the capture. Look for investors focusing on the origination of each director and service provider, which is to say how he or she came to be proposed, to address social relatedness.

Answer:
Boards can protect themselves by terminating any director or professional advisor who cannot be reasonably seen, by directors themselves and more importantly by an outsider, to be independent from management in their oversight and assurance roles. Assume what boards know internally is what is or will become known externally. This trend towards tighter independence standards will continue: For example, internal oversight functions should also now be independent from senior and operating management, and that includes the risk, compliance and audit functions, who now should report functionally to the committees and board. Any director or external or internal advisor to the board or a committee should be, in law and in fact, independent of all reporting management or any other adverse interest, in order to be free to make recommendations that run counter to that of management. A board fully protecting itself would also require a third party anonymous review of director and advisory independence annually, and acting on the results. Directors know who is captured and there should be a mechanism for this to come through.

2. Better Board Composition and Diversity

Pressure:
Regulators are moving towards prescribed competency matrixes; the production of curriculum vitae (not perfunctory short bios); and interviews with directors and oversight functions to determine whether these individuals are fit for purpose. Activists are searching director backgrounds and track record to determine alignment between competencies and the business model and strategy of the company. Regulators are legislating board renewal and diversification, through quotas or the production of measureable objectives covering recruitment to retirement.

Answer:
Competency, diversity and behavior matrixes should: flow from the purpose of the board and the strategic and oversight requirements of the company; be established by the nominating committee; and be independently designed and validated to ensure recent and relevant expertise is possessed by each director. The diversity policy should extend the prospective director pool to previously unknown directors and who may be joining their first board (80% of directors are on one board only). Tenure limits and excessive directorships (beyond two) should now be policed and capped (the average board position is 300 hours). Robust matrix analysis and director evaluation should occur by the nominating committee and its independent advisor, not management. The board should extract directors who do not possess relevant and recent competencies or desired behaviors. (See boardroom dynamics, below, for a separate discussion of director behavior.)

3. Risk Governance

Pressure:
Plaintiff’s investor lawsuits and proxy advisory firms are targeting directors at risk for oversight failure. Regulators are imposing onerous risk coverage requirements on directors that require oversight of internal controls, risk-takers and limitations. Lack of understanding of social media, bring your own device, and cyber security are contributing to enormous investor loss and brand impairment, as an example of technology risk. Recent risk failure by boards also includes sexual harassment, safety, security, technology, bribery, fraud and reputation.

Answer:
Boards should now have directors possessing risk expertise, as regulators are requiring this. The identity of these directors should be disclosed. Every company should board-approve a risk appetite framework, including internal control reporting and independent, coordinated, assurance over controls mitigating each risk and their interactions. Directors using technology dashboards should oversee risks prospectively. Hiring of risk, compliance and audit functions should occur, reporting to the audit and risk committee. Known limitations should cascade throughout the organization, and back up to the board, with ease, including within each market in which the company operates, and to key suppliers. Annual third party reviews should occur, reporting directly to the board and audit and risk committees. Board and committee charters should have coverage over each material risk, financial and non-financial. Audit committees that oversee substantive non-financial risks may be a red flag. There will need to be significant investment and restructuring of reporting relationships for the foregoing risk governance regulation to occur.

4. Compensation Governance

Pressure:
Media and public pressure over the quantum and alignment of executive pay have resulted in regulation over: compensation committee and advisor independence; say-on-pay; proxy advisors; and pay ratios; but not over pay-for-performance (most important) and clawbacks, yet. Certain public regulators have become more aggressive, targeting the quantum of pay. Financial regulatory focus is on the delivery and alignment of pay. There is a modest, but will be a growing movement once full regulation occurs, moving from (i) short-term, quantitative, financial pay metrics, relying on comparator inter-company benchmarking, which exacerbates pay unrelated to performance, to include (ii) long-term, qualitative, non-financial pay metrics, with customized, risk-adjusted pay delivery commensurate with internal value creation and shareholder return.

Answer:
Boards should engage directly with long-term, major shareholders on their pay plans, without management influence. Clawbacks should be restructured or implemented based on risk management and ethical failure, not fraud, using an independent advisor not the company lawyer or management-retained counsel. Boards should approve key performance metrics based on an explicit full business model invoked from the strategy. 75% of the performance metrics reflecting the firm value chain should be leading and non-financial indicators. Peer benchmarking should be balanced with the foregoing pay principles and long-term alignment with the product cycle of the company (five to seven years, not three). Non-financial leading metrics such as innovation, value and quality, and financial metrics such as balance sheet and capital treatment and returns, should be incorporated into pay plans that have a line of sight to management performance, without any unjust exogenous enrichment. There is much work to be done here, and more regulation is expected in 2015 and 2016.

5. Greater Shareholder Accountability

Pressure:
Look for activism to grow unabated, and institutional shareholder and even regulatory support of proxy access in 2015, giving greater control to shareholders over director selection and removal. Look for further shareholder assertion of rights and coordination over the targeting of below-average management supervised by complacent boards. Look for shareholder focus on director mindset, track record, and lack of management capture or self-interest. Look for continued attack on entrenchment devices by management and their retained advisors to insulate under-performers.

Answer:
Camera-ready boards should implement private, candid, executive session meetings with long-term shareholders to discuss governance, risk, pay, and value creation. Investors and boards should focus on company performance in comparison to peers, and superior governance that exceeds the minimal. This includes background of directors. Independent governance auditors should be retained to provide an activist point of view, ahead of a possible attack. Any advisor to the board on shareholder engagement should be independent of management.

6. A Focus on Strategy and Value Creation Focus

Pressure:
Activist and, increasingly, good board focus is on the value creation plan, monitoring, and holding management responsible for its achievement. Complacent or inexperienced boards incapable of directing an under-performing, ineffective or inefficient management team are being targeted. Weak or legacy chairs and directors are also targeted. Excessive or non-performance based compensation is a red flag for governance intervention.

Answer:
Good boards are becoming engaged, focused, results-oriented and disciplined. Agendas and committee structures are being revised to focus on strategic primacy and value creation. Robust debate and review of the plan is the primary board agenda item each meeting, and strategic practices are adopted, such as, among others, that at least one presentation each meeting from key personnel below the senior level, on that person’s role in the value maximization plan, and a full discussion of progress to date in that regard. However, board renewal is not reflecting this structural and deeper board focus, yet. Ill-chosen directors are still unable to add value strategically, my applied research suggests. There remains ample opportunity for activist intervention.

7. Information Technology Governance

Pressure:
Rapid technology advancement has created opportunity and risk. There is profound technological ignorance by many or most boards that is creating an inability to direct and oversee management. Cyber security, bring your own device, and social media are just three IT risks that, reviews indicate, have deficient or non-existent internal controls, which in turn causes privacy breach, reputational damage, and significant investor loss. Plaintiff’s lawyers are suing boards, correctly alleging breach of duty of care. Regulation is not keeping up with cyber-threats and hacker advancement.

Answer:
Boards should be IT literate, agree on the standard and platform, and direct management to have an action plan and target date for implementation, covering crown jewels; assuming penetration; and including internal controls over behavior and human error. Boards should control the budget, talent, resources, reporting and assurance of IT risk as part of broader ERM (enterprise risk management) and strategic risk. Scenario testing, mock attacks, and expert assurance should be board-reported. If management resists third party validation, this is a red flag for any board.

8. Board Performance Audits

Pressure:
Regulation, activist, technical and public pressures are augmenting the objective standard of care for directors. Director action (or inaction) will be visible and risk liability or other loss post failure. Resourced and sophisticated investors are a particular threat, as are regulators. Complying with basic practices is no longer adequate assurance or protection for boards, as capture, entrenchment, self-dealing, complacency and non-performance have all been shown to occur within existing governance frameworks. Governance failure, including bribery, corruption, cyber and under-performance, has occurred at companies whose governance has been said to be exemplary.

Answer:
Good boards and regulators are moving towards independent, internal and deep reviews over the board, risks and internal controls, similar to financial audits. Just as management cannot assure its own work, neither can boards assure a self-review. A well-chosen third party or independent internal auditor provides boards with advance warning on precisely where their vulnerabilities and weaknesses are. An expert audit within an activist and emerging regulatory framework is a wise use of time and resources.

9. Tone at the Top – and Now in the Middle

Pressure:
Long arms of regulators are now able to hold boards vicariously responsible for fraud, bribery and other forms of corruption at deep levels within and even interacting outside their organization. The distraction, assets put at risk, and reputation damage can be significant. “Tone in the middle,” culture, and imprudent risk-taking are the new warning signs on which sophisticated boards are requesting concrete assurance, to ensure directors are not the last to know.

Answer:
Resourced boards are instituting: confidential and incented whistle-blowing procedures; audits of internal controls over culture and reputation; and amnesty, among other best practices, to ensure bad news rises. Explicit and monitored thresholds for the board-approved risk appetite framework are being instituted, along with a line of sight by the board that compensation is not driving bad behaviour. Due diligence, climate, values, spot audits, and the code of conduct are all being independently reviewed and reported to committees and boards, without interference or funneling of reporting management. Good boards are much less tolerant of ethical lapses or management blockage.

10. Boardroom Dynamics

Pressure:
Lastly, the board must gel as a team, and, as a team, control management. Any behavior gap – undue influence, reliance, dislike, dysfunction, or even contempt – by one or more directors or managers, introduces information and oversight asymmetry that can and does lead to governance failure. Every seat at and reporting to the board table matters. The pressure here is a toxic or under-performing director who refuses to resign out of self-interest, or a board allowing integrity breaches and leadership shortcomings by an officer to continue.

Answer:
Good boards: have behavior matrixes and performance reviews that define and rate behaviors at the board table; have peer reviews and mentoring that develops and refines behaviors; and act on the results regardless of profile or tenure. Due diligence, background checks, interviews, and assessments are all becoming commonplace. Personality testing is also developing.

Conclusion
There has been more governance change occurring in the last five years than in a generation. Enron, WorldCom and other implosions in 2001-02 are very different from the global financial crisis of 2008-09, which: was systemic, involved banking, and required broad government intervention. There is a regulatory and investor appetite for broad and deep governance change. The above ten changes and responses are touch-points for where governance change is happening the most. Boards and management teams are only about 40% through digesting all of the above reforms, and there are more to come in 2015.

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*Richard Leblanc is a governance lawyer, academic, speaker and independent advisor to leading boards of directors. He can be reached atrleblanc@boardexpert.com or followed on twitter @drrleblanc.

tomate, represented by its partner Sergio Guzmán, participates in the XI Human Management Congress in Argentina to be held on August 5th at the Teatro San Martin in Buenos Aires. In the panel “The Dark Side of Commitment”, he will present the relevance the matureness of the Board of Directors of a company has with the commitment the employees have in their organization.

The Dark Side of Commitment The fish rots from the head, Chinese expression that stands out that the Board of Directors, as head of the organization is key to have a culture that promotes compromise among people working their; on the contrary, the company will not stand for long. Commitment is the result of a tacit or formal agreement among people agreeing on a given delivery in a specific timing and form. Commitment is what he or she (or they) asks for or offers and he or she (or they) accepts to receive what is committed in the right time frame and form and that appraisal judgments will be made reciprocally in relation with what is committed by both parties. The commitment involves both parties, since who asks for or who receives the offer must state his or her judgments in time as well, and reward the fulfilling or compensate for and repair should he had not kept in force the validity of the request. As a result of these judgments there may be compensations and the trust capital for future commitments of the company will improve or decrease. For this process to occur, the commitment of the interlocutors required:

  1. Recognize each other and act as equals in the negotiation of what has been committed; the other party as a valid me. Freedom through the bargaining process to get the commitment is key to have a valid compromise from each part.
  2. To understand that what you want to keep is not the committed, but the trust relationship between both parts, that underlies the commitment.
  3. The ability of both sides to ponder, that is to say, to have the state of emotion to put in common the certainties each party has. The negotiation of both parties requires the necessary abilities and distinctions: knowing how to listen to others and listening to oneself; asking and wondering; observing and observing oneself.
  4. A culture that legitimizes these practices and the corporate value involved. That is to say, the culture of the company will be that culture supporting the commitment of each person with his company.

Is the Board of Directors who definitively sets the tone of the culture in the company, whether by act or omission? The practices of how the Board of Directors functions will develop more or less a culture where people are committed. If the relationship among the directors is not the adequate; if the coordination, focus and architecture of the information the Board of Directors counts on corresponds to an immature organization; if the relationship between the Board of Directors and the CEO is not supported by this reciprocal commitment approach, where both parties concur with the differences we have stated; if mistrust prevails; if the style is more purposeful than investigative; if definitely the commitment does not exist in this angular relationship, the rest of the company would not be able to obtain a high level of commitment of its collaborators. 

The belief that there is a direct connection between the board of directors and organizational success has been gaining ground lately, evidenced by the pressure shareholder activists have been exerting on boards for transparency as well as the “zombie director” movement to remove underperforming directors from boards.

But research into what actually makes for a better board — and ultimately, a more profitable organization — remains surprisingly scant. As a result, most companies rely on the “same old” approaches to screening for board directors, recruiting friends and others who they believe have appropriate experience and expertise.

There may, however, be a better way of not only screening for appropriate board directors, but managing the board’s interactions to generate economic value. My recent research provides evidence of what directors (and academics) have intuitively known for years but have been unable to verify — namely that the quality of board members’ interactions are crucial to board success. In an earlier study described on hbr.org, I found that board members who didn’t know each other before joining the board were more likely to engage in productive cognitive conflict. This finding helped craft my subsequent research inquiry: What impact does board dynamics have on financial outcomes?  My research provides strong evidence supporting three findings:

  • “Cultural intelligence” of individual directors, or their predisposition to working well in teams, is critical in generating high-quality team dynamics (more below);
  • The quality of board-level team dynamics is highly correlated with firm profitability; and
  • Boards that are able to function effectively as a team have an 800% greater impact on firm profitability than any one well-qualified board director — in other words, and consistent with Aristotle’s observation, the whole is greater than the sum of its parts.

I measured board dynamics with a new 30-item Team Dynamic assessment tool developed by Tony Lingham, an associate professor at Case Western Reserve University’s Weatherhead School of Management, where I’m working on my doctorate. I surveyed 182 randomly chosen directors who, between them, served on the boards of 572 U.S. firms and had an average of 12 years of board experience. I asked them to rate their board’s interactions along ten behavioral attributes — engagement, active listening, individuality, relationality, solidarity, understanding, action, planning, power and influence, and openness. Then I asked them what their boards’ interactions in those areas would have to be like for them to be maximally effective. The diagnostic tool measured the gap between those two scores, and I found that boards with smaller gaps between the current dynamic and the maximally effective dynamic were more effective and their companies more profitable than those boards where the gap between current and desired dynamic is high.  At this point, I have personally worked with over 25 board teams, and the results are consistent — improve dynamics and overall board performance, creativity, innovation and satisfaction are enhanced.

The Team Dynamic assessment is a proprietary tool offered by Lingham’s firm, Interaction Science. I’m currently testing whether a similar diagnostic offered by Team Coaching International delivers equivalent results. Specialized team coaching can improve the dynamics of teams of all kinds — as yet unpublished research by Lingham shows that a single, two-hour team coaching session designed to address the gaps identified by the team diagnostic assessment can improve team dynamics scores  from 48% to 191% within one month.  These improvements proved to be sustainable over time.

To measure a director’s predisposition to working well in teams, I turned to the cultural intelligence assessment originally developed by Purdue University’s P. Christopher Earley (see “Cultural Intelligence” by Earley and Elaine Mosakowski in the October 2004 HBR). The questions I asked were drawn from the 20-Item Four Factor Cultural Intelligence Scale published by the Cultural Intelligence Center. CQ grew out of the concept of emotional intelligence, and appears to more applicable to team interactions than the more didactic manager-employee relationships targeted by EQ. CQ assesses a person’s ability to make sense of unfamiliar contexts and “fit in.”  What I found was that board members’ CQ scores were a much stronger predictor of boards’ team dynamics, as measured by the team assessment tool, than their professional qualifications or their social/business networks alone.

The lessons here are pretty clear. Boards can improve their performance by focusing on team dynamics. The key steps to take are:

  • Determine your board’s dynamic.  If it’s healthy, great!  If it’s weak, there’s work to be done to best position the board to meet its fiduciary responsibilities — that is, to have a positive bottom-line impact.
  • Rethink your recruiting criteria.  My prior research showed that recruiting “strangers” to boards tends to generate higher levels of governance quality. This research implies that boards should screen directors for CQ to ensure that the director has the skill and motivation to work well with the existing board.
  • Get team coaching.  If there are gaps in your team dynamics, team coaching really can help. Transforming a weak board to a strong board is not investment-intensive, and the benefits are significant.

 

Original Post link: http://blogs.hbr.org/2014/01/the-key-to-a-better-board-team-dynamics/

Estelle Métayer in her article Boards of directors: less oversight, more foresight?, said:

“As long as boards of directors remain homogeneous, they will, by definition, be biased. One of the solutions is to force diversity among board members in order to bring in the external expertise necessary for the future of the company. This diversity might be geographical, such as including on the board an independent board member who, for example, knows China well. Diversity might also be linked to bringing in new skills (such as including a board member who understands the issues related to social media) or even match more closely the segmentation of the customers.”

However, diversity is not always  a good idea. At tomate, we think that if we want to succeed in a diversified world the board of directors should have the ability to celebrate the differences or experience them within a serenity framework that will take full advantage of this greater diversity.

We must learn to live in diversity and this learning is not cognitive but emotional, basically. We shape our personalities in sharing diverse backgrounds and if there is diversity, change is more enriching. But if we cannot co-exist in diversity, it is better to have a more homogeneous board of directors, even with the blindness this necessarily implies. If we want to build a better board of directors, then we must have the means to live in this state of greater diversity that allows generating more value for everyone if each director validates others even if they do not share his or her opinion. Living in diversity as an attribute to foresee is like running the Ironman; it is not just go and run. We must learn and “train”, basically  putting ourselves in the others’ shoes to understand why they say what they say, as a valid observer for who does not share his or her opinion. to

Visit: www.competia.com

THOSE of us who still read newspapers over breakfast have had a delicious choice of late: do we start with the story about Bradford’s crystal Methodist or the one about Toronto’s stuporman? Paul Flowers, the former chairman of Britain’s Co-
operative Bank and a Methodist minister, allegedly bought cocaine and crystal meth for a “drug-fuelled” orgy. Rob Ford, Toronto’s mayor, has finally admitted, after months of denials, that he smoked crack cocaine—before adding the comforting proviso that he only did it in “one of my drunken stupors”.

What does any of this have to do with Schumpeter’s home territory of chief executives? Mr Flowers was no banker: he rose through the co-operative movement’s political structures. Mr Ford is an elected politician. But they nevertheless illustrate a problem too often ignored in business, where people are much happier talking about dollars than dolour: how can you tell when a boss is showing signs that he may go off the rails? And what should be done about it?

The corner office is almost a factory for personal problems. Chief executives are under greater pressure to perform at the best of times; how much greater in periods of economic turbulence. Yet at the same time power corrupts. In experiments social scientists have shown, by giving random subjects power over others, that even in small doses it produces overconfidence, insensitivity and an urge to associate with other people with power.

Chief executives’ oddities can lead to complete corporate breakdown: it is impossible to read about the implosions at WorldCom or Hollinger or the Royal Bank of Scotland (RBS) without being astonished by the bosses’ behaviour. But even in less dysfunctional firms the whims of the man at the top can cause damaging depression or sycophancy below. Chief executives are the nearest things democracies have to sun kings.

An obvious sign of a boss breaking bad is grandiosity. He attributes the company’s success wholly to himself, indulges in endless self-promotion or demands ever more extravagant rewards. Jean- Marie Messier, who transformed Vivendi from a staid water utility into a media conglomerate that ran up huge losses, borrowed his nickname—“J6M”, which stands for “Jean-Marie Messier Moi-Même-Maître-du-Monde”—for the title of his autobiography. One study shows that chief executives who appear on the covers of business magazines are more likely to make foolish acquisitions. A second sign is over-control. The boss surrounds himself with yes-men and crushes dissent. He tries to control every detail of corporate life rather than building a strong executive team. A third sign is distorted decision-making. The chief conflates personal and corporate assets, is obsessed with buying other companies, or focuses on bizarre details. Mr Messier spent $17.5m of Vivendi’s money on a New York apartment for his personal use. Fred Goodwin, boss of RBS, micromanaged the building of a £350m ($630m) head office, called “Fredtown” by his underlings, and found time to redesign the bank’s Christmas cards.

A chief executive becomes likelier to succumb to these vanities the longer he stays in the job. He gets used to people fawning over him. He measures himself against other inhabitants of Planet Davos, not those Barack Obama calls “regular folk”. Percy Barnevik, the boss of Asea Brown Boveri, an engineering conglomerate, was widely hailed as “Europe’s answer to Jack Welch”. But the comparison went to his head: he pursued ever more reckless acquisitions and got himself awarded a tax-free pension of $87m. A boss may think himself so brilliant he refuses to plan for his eventual departure or undermines possible successors. Armand Hammer, of Occidental Petroleum, asked his board to agree to a long-term bonus plan, with a ten-year payout, when in his 90s.

What can companies do to stop the boss behaving oddly—ideally, before he starts? In a recent study MWM Consulting, a firm of headhunters, argues that boards need to make “behavioural risk” a standard part of their agenda. This might well include taking soundings from senior management. Chairmen also need to start talking to chief executives about the personal side of the job when they are first appointed, and keep talking afterwards.

Remember the Little Bighorn

However, the best answer lies with chief executives themselves, who must recognise that the biggest threat to their success may lie within. They need to cultivate the art of seeing themselves as others see them. Kevin Sharer, the former boss of Amgen, a biotech company, used to get his direct reports to list his strengths and weaknesses annually for the board. He also kept a painting of General Custer in his office as a warning against hubris.

The business world is starting to take these problems seriously. One of the most popular courses at Harvard Business School is Clayton Christensen’s course on how businesspeople should guard

against an obsession with short-term success. About 40% of the heads of FTSE 100 companies employ “personal coaches”. Chief executives last half as long in the job, on average, as they did a decade ago. That may be bad for their nerves, but it makes them less likely to be become marinated in power.

That said, it is foolish to treat a cold as a cancer. Bosses have a right to privacy. In recent years Boeing and Hewlett-Packard have erred in disposing of chief executives after consensual affairs. The border between eccentricity and brilliance can be blurred. Bosses are peculiar anyway: more ambitious and more self-confident than the rest of us. Some of the most creative people in business have been very peculiar indeed: Henry Ford loved conspiracy theories of the blackest hue; Thomas Watson of IBM commissioned company songs in his own honour. The most important business decisions are still, as they have always been, nuanced ones about character and its complexities.

Schumpeter: Going off the rails | The Economist

against an obsession with short-term success. About 40% of the heads of FTSE 100 companies employ “personal coaches”. Chief executives last half as long in the job, on average, as they did a decade ago. That may be bad for their nerves, but it makes them less likely to be become marinated in power.

That said, it is foolish to treat a cold as a cancer. Bosses have a right to privacy. In recent years Boeing and Hewlett-Packard have erred in disposing of chief executives after consensual affairs. The border between eccentricity and brilliance can be blurred. Bosses are peculiar anyway: more ambitious and more self-confident than the rest of us. Some of the most creative people in business have been very peculiar indeed: Henry Ford loved conspiracy theories of the blackest hue; Thomas Watson of IBM commissioned company songs in his own honour. The most important business decisions are still, as they have always been, nuanced ones about character and its complexities.

Economist.com/blogs/schumpeter (http://www.economist.com/blogs/schumpeter)

Calm coherence and consistency in the tasks of the General Manager or CEO of a company, are not common features of the corporate world prevailing in our culture nowadays. Like a dinosaur that refuses to give up its seat of power, leadership is still understood in connection with power rather than service. It is a growing concern in the analysis and study of corporate management and especially in the field of corporate governance, the behavioral excesses that the present leadership culture originates in many General Managers in the world: being surrounded “yes men and women!”, CEOs are considered the only architects of the successes and lashers of those who are responsible for the failures; the CEOs appropriation of the benefits and incomes over their true market value and the minimum sense of fairness to the detriment of the rest of employees of the company, especially the lower echelon workers; the exploitation of relationships with strategic suppliers to receive the benefits of being congratulated by the Board of Directors in the short term by receiving juicy bonuses; to commit their word with such liberality that, in the same manner as they make their promises, they unilaterally change their commitments both in time and in form, they may even take them back. All this is the product of our present leadership culture, which still dominates the class rooms in the business administration teaching world. Undoubtedly this leadership vision does not explicitly encourage these dissonant practices, but they are the natural outcome of the set of emotions on which this notion of leadership over reason is based and the interests that are embodied by the head of an organization, who receives the power from its Board of Directors, that only hopes that he will get the expected results. Fortunately, there are greenshoots predicting changes, not matter how marginal they are. Companies that are aware of the excesses in the behavior of these CEOs have implemented, sometimes by the own initiative of these heads that understand the risks of wielding so much power, annual report systems for their Board of Directors, where the reports of the CEOs anonymously assess the good and bad characteristics of the way their boss guides the team and the company that the Board of Directors has requested them; therefore, the organization and the General Manager himself may have the checks and balances to avoid the head losing the focus of acting with coherence and calm to confirm, serve and nurture the company’s teams.

COLLABORATION WITH THIRD PARTIES

tomate® has developed collaboration relationships with persons and companies that, sharing basic styles and tenets, complement our value offer for the development of the corporate governance practices.

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tomate.club®

En tomate.club® estamos convencidos que lo que “la lleva” en nuestro siglo, son las relaciones. Las organizaciones están formadas por personas y, dentro de su individualidad como seres humanos, debemos potenciar su desarrollo, entendimiento, formas relacionales; en definitiva, lo humano.

The Paradigma Commitment

The Paradigma Commitment [TPC] is a company based in Monterrey, Mexico. The company started operations in 2000 with the following areas of expertise:

  • Strategic alignment and mobilization
  • Redesigning business processes and value networks
  • Executive leadership and development
  • Administrating innovation

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