The Odd Couple

Why chief executives and chairs rarely enjoy harmonious relationships. By Craig Dearden-Phillips

Forced together: Jack Lemmon and Walter Matthau
Forced together: Jack Lemmon and Walter Matthau

Most of my days are spent working with chief executives of social businesses or charities. About two-thirds of them have problems of some description with their chairs.

Some of this is to do with recruitment and compatibility, but most of the difficulties arise because either the chief executive or the chair (and sometimes both) don't really understand what the relationship is supposed to be achieving.

So what is the ideal relationship between a chair and a chief executive? In essence, it's a bit like a good marriage. Yes, a bit of giddy stuff at the beginning but, in essence, a value-creation partnership between two people: the one running the organisation's management team day to day and the person managing the board of directors or governing body as a whole. Both chief executive and chair share the responsibility for delivering long-term success. This means agreeing long-term objectives, a strategic roadmap to achieve them and a defensible approach to managing the risks that occur along the way.

Of course, like any married couple, the chief executive and chair will not always view things exactly the same way. If they did, there would be little point in both of them being involved: neither would bring anything different to the marriage. Indeed, the very point of these two leading roles is that each will approach the big questions of goals, strategy and risk in slightly different ways. Ideally, each will influence, check and challenge the other. As a result, the company's chances of success are increased. Mirrored across the board as a whole, this is called good governance. And a good board is very much like a good family: opinionated, supportive, diverse, but working for common goals.

Problems in the chief executive/chair relationship arise (like in marriages) in three main ways. The first is when the chair and chief executive have such divergent views on the main questions that conflict arises: "We want different things." Such partnerships degenerate into power struggles as one tries to assert authority over the other. The early ending is only a matter of time.

The second problem is when the chief executive and chair are too close. Remember Camila Batmanghelidjh of Kids Company? In Alan Yentob, she had a chair who saw his main job as supporter (or cheerleader) for the chief executive. The result: goals, strategy and risk were not agreed in a proper way. Check and challenge were absent. This is the equivalent of the spendthrift husband being driven by his adoring wife to empty the ATM for a new set of golf clubs. The relationship is damaging to both people as well as to the wider family.

The third is when one or both misconstrue their roles. A common error is when either chief executive or chair assumes the other to be subordinate. Just last week, I encountered a new chair who talked about "my" chief executive, even though the chief executive was a founder of the organisation. That relationship hangs very much in the balance.

Other errors abound: when the chief executive expects the chair to be their number one fan, a mirror in which to see their own brilliance; when the chief executive views the chair as an unpaid psychotherapist; when the chief executive expects the chair to be some kind of conduit to the rich and powerful. None of these is in the job description of a chair, and to look for them is the equivalent of seeking perfection in your marriage partner. The reality will only disappoint.

Equally, I know chief executives who manoeuvre weak or ineffectual people into the chair role because they know they can walk all over them. This is a particular problem in many public service mutuals where the chief executive, high on the mountain air of independence, is naturally cautious about bringing others into positions of influence once again. Their behaviour is akin to the new divorcee who vows never to remarry for fear of losing their hard-won freedom.

The really smart chief executives and chairs know that the subtle power of marriage is the thing to aim for. It's about two people coming together, as independent people, to create something better, safer. One plus one equals seven. In this partnership there has to be comfort, enjoyment and enrichment on both sides.

Conversely, there also has to be difference, respect and, at times, quite a bit of distance. Both face in the same direction, but will survey the scene from different angles. Most crucially, like all good married couples, chief executive and chair communicate their differences and use them to forge ahead. And, as in a real marriage, it's when the talking stops that the problems start.

Above and beyond all this, there are often difficulties that originate in the way chairs in particular are appointed. Compared with the care taken over recruiting to chief executive roles, chairs are often appointed in the manner of the 18th-century House of Lords (or, indeed, the current one). They are somebody's best friend, or a "well-connected" industry player or an existing trustee with time of their hands, who really wants a full-time job. I have seen it all. From the chief executive's point of view this can feel like a forced or arranged marriage.

Many chief executives I know who feel they are, on some level, in an unhappy relationship are improving their situation by reframing their opposite number purely as a business partner and judging their value through that lens, rather than expecting them to be a cheerleader, coach or gatekeeper to the next big deal. They recognise that, like in marriage, it is unwise to build your self-esteem, network or finances around another individual, however well you get along.

The ideal chair can, of course, do all of these amazing things for a chief executive from time to time, but their primary function is to bring a different, high-quality perspective to the major governance questions about goals, strategy and risk.

That's what to aim for. Not romance. Not dominance or dependency. Not a sugar daddy (or mummy). Rather, a marriage of equals.

Craig Dearden-Phillips is managing director of Stepping Out and convenor of Social Club, a network for third sector chief executives

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