Corporate board decision-making: applying collective versus personal values

Abstract

PurposeThis paper aims to offer a solution to the dilemma of board members using their personal values to drive decision-making and strategy. Board members are asked to discuss the collective values at the onset of strategy planning.Design/methodology/approachSix questions, developed over a 15-year period of working in the area of strategy and governance, unite research on values in organizations, and provide a guide for arriving at a set of agreed-upon values for decision-making.FindingsTwo examples from practice showcase how agreeing on values before beginning the strategy process has assisted boards with better decision-making.Research limitations/implicationsThe questions and process are meant to be a reflective tool for board members to consider when discussing values and decision-making rather than predicting behaviour or explaining outcomes. The process is most effective for boards whose culture supports a desire for improvement and therefore a willingness to experiment with new processes. The process can be enhanced by using an external facilitator having the ability to extrapolate meaning as the discussion unfolds.Practical implicationsThis work empowers board members to be more effective in assessing strategic options and in communicating the inner logic and meaning of the strategy throughout the organization and to the external stakeholders.Originality/valueAdvocating that boards engage in focused discussion around values at the beginning of the strategic process improves decision-making and provides a litmus test for evaluating the strategic options. Agreeing on a set of values also makes board members more aware of the implications of each option in the long term.