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Building Better Governance: Strengthening Boards and Leadership in Associations · Associations NOW Presents

0:03
Dave Coriale: Hello everyone. I'm Dave Coriale, president of
0:05
DelCor and host of another podcast, Reboot IT, where we
0:08
talk about all things technology for the association and 501 C
0:12
community. Today I am guest hosting this podcast, and I am
0:15
very excited about our two guests. One of them is Mark
0:19
Graham, who is the vice president of association
0:21
solutions at ASAE, at the Center for Association Leadership. And
0:26
the other is a leader I've been a fan of for a long time, Paul
0:29
Pomerantz. He has been a CEO of several health and medical
0:33
associations before this, and he is currently the managing
0:36
director of the Association Governance Institute. Let's get
0:40
going. Let's listen in on the conversation. I think there is
0:44
plenty to gain from hearing what they have to say, and here we
0:48
are having the conversation I've been looking forward to for
0:51
weeks now, ever since this was scheduled. Paul, Mark, thank you
0:54
for taking your time. I know you're both very busy to talk
0:57
about something that's coming up and very important, the
1:00
Association Governance Institute, that is one of the
1:03
main topics. I'm sure we'll weave and bob through a couple
1:06
others along the way. But like always, I like to start my
1:09
podcast with what are we talking about? So let's talk a little
1:12
bit about the Association Government Institute, what it
1:16
is, etc. Mark, I think you'd be great to lead that part of the
1:19
conversation. So why don't you give us a little bit of
1:21
background and where we're headed here?
1:23
Mark Graham: Sure. So the Association Governance
1:25
Institute, AGI, the brainchild of Michelle Mason, wanted to
1:29
create a brand new home for governance, for associations.
1:33
ASAE has done a pretty good job at governance, but we wanted to
1:37
really focus on it and really have a terrific resource
1:40
library. What we did was we always created, like a brand new
1:43
organization. Why we called it the Association Governance
1:46
Institute, although it will be part of your ASAE membership,
1:49
and what it does, it creates a library of resources that are
1:52
all focused on just governance. If you search as a website now,
1:56
and you search governance, you'll get a whole host of
1:58
content. But what we've done is we really drill down to a bunch
2:02
of categories of governance, six categories of governance and
2:06
three to five subcategories of governance, because governance
2:08
is quite complicated. There's an art and science to it, and we
2:12
hope to address both of that with the Association Governance
2:15
Institute. So let me give you a few examples of the categories.
2:18
The CEO-board relationship. We're talking about. The CEO
2:20
evaluation, the compensation, the contracts we get into the
2:24
culture of boards. One of the major responsibilities with
2:27
board is to hire and manage the CEO. So we have a whole section
2:30
on executive transitions, operations. We're talking about
2:33
the soup and nuts of how boards operate. We have tons of content
2:37
and sub content on all these topics to round it out. We have
2:41
strategy and oversight and structure, so we've really used
2:45
a lot of our advisory committees of CEOs and consultants to help
2:49
us devise this whole new institute and how to organize
2:52
all the content. That's the content part of it. But we're
2:55
also including new tools with AGI and new educational courses.
2:59
Paul and I have always joked, this is like creating a brand
3:01
new organization. We started last January, and we're ready to
3:05
launch next month.
3:06
Paul Pomerantz: Really exciting stuff. And just to add to this
3:10
part of the thinking behind this, especially as this was
3:13
first being developed by Michelle and myself and some
3:16
conversations. The idea was twofold. One, ASAE has a lot of
3:22
resources, but they're in different places, so the idea is
3:25
bring it together and really emphasize it, shine a spotlight
3:28
on it, and make it easier to find, more accessible, and then
3:32
give it a place to grow. So we already have a great set of tool
3:35
kits. But what's missing? What needs to be developed? What
3:38
other tools can we develop? So this will provide that kind of
3:41
focal point for it. The other thing is that you think about
3:45
the CEO job, and CEO is successful, if his governance is
3:49
successful, if the CEO and the board are working in unison,
3:54
they're aligned, goals are clear, resources are being
3:57
allocated according to the goals and the plan of the
4:00
organization, then you have a healthy organization and it
4:05
functions. Things break down when governance doesn't work.
4:08
And so in our view, job one for a CEO is to make sure that
4:13
governing process works; that there's communication; there's
4:17
transparency; there's clarity. All those types of things. And
4:21
part of our goal is to really support the CEO in carrying out
4:25
that part of their position, the CEO and the staff team in other
4:30
industries. corporate setting. You have the National
4:33
Association of Corporate Directors in the healthcare
4:36
setting. You have other governance resources.
4:39
Associations do not have that kind of focus, and we're
4:41
bringing that kind of focus to it.
4:43
Mark Graham: Yeah. And as Paul says, this is a starting point.
4:45
In January, this thing will continue to evolve and grow with
4:49
the help of our advisory committees. Paul has been
4:52
instrumental, my partner in crime, if you will. He's a
4:55
bright star when it comes to governance knowledge. So he's
4:58
helped guide this thing from the very beginning.
5:01
Dave Coriale: No better guide out there. So I do have a
5:03
question. You mentioned content. Two questions. One's about
5:06
content. You mentioned that you've gone through and you've
5:09
curated the content. So this sounds like it's new content,
5:12
and probably a mix of some existing content. And so I want
5:15
to hear a little bit more about that, as well as the assessments
5:19
that you mentioned. What type of assessments would one find in
5:22
the AGI?
5:23
Mark Graham: Sure. So the content is divided into a couple
5:25
of different categories. You have a lot of opinion and
5:28
articles thought leadership on best practice and governance and
5:31
all those categories that I just mentioned. We also have how-tos,
5:36
checklists and case studies. These are all tools you can give
5:40
people to help them do better. In governance, I'll focus on
5:44
maybe one area: executive transitions. There is a lot of
5:47
guidance. We've been talking about CEO succession for decades
5:50
and how to improve it. So we've gone through and curated all the
5:54
best articles on CEO succession. We provide some checklists on
5:58
CEO succession. For instance, very sadly, sometimes there may
6:02
be an abrupt departure of a CEO. They may be terminated, they may
6:05
quit. Sadly, may even pass away. We have checklists of what you
6:09
should do, and each one of those instances, executive transition
6:13
also involves a CEO contract. So we have whole sections on
6:16
contracts from the board's perspective and the CEO's
6:19
perspective, what to look for, what to negotiate, what's
6:22
important, what you really focus in on? And of course, there is
6:25
compensation. We have lots of tools and compensation
6:27
philosophy. We even have a whole practice built around helping
6:31
organizations determine the right compensation for their
6:33
CEO. So that's just one of those areas that we really drill down
6:37
and focus in on. The content. So we provide the opinions, the
6:40
articles, the how tos, the checklists. We do this for every
6:44
single one of the categories. Like in financial management, we
6:47
have 20 questions a new board member should be asking about
6:50
the financial situation of an organization. This is good for
6:54
someone who's maybe new to governance and doesn't know what
6:56
they're doing. So it's a good primer. We could talk about all
6:58
the content, almost this entire podcast, who does just so much
7:02
of it, governance. I went into this knowing a little bit about
7:05
governance, and now I think I'm almost an expert, almost nearly
7:09
half as smart as Paul, because there's so much to governance,
7:13
the science of it, there's so much to it. And where people
7:17
mainly get tripped up is the art of governance. And so we hope to
7:20
be taken care of the whole package.
7:22
Paul Pomerantz: I couldn't agree more. And one of the great areas
7:26
of content that we're really proud of, and we go through
7:28
everything like Mark says: legal, roles and
7:30
responsibilities, all these things. But one of the areas I'm
7:34
very proud of is the board selection and development piece.
7:37
And this is the area where Mark Engel and some other folks have
7:42
been leaders in this area and have really created publications
7:46
and tools. Well, all those are going to be curated into this
7:50
website. So the whole idea of, how do you evaluate board trends
7:54
and board needs? How do you recruit for a board house is an
7:58
optimal leadership development process? How do you orient and
8:03
train and own board members? How do you evaluate their
8:06
performance? All those kinds of really rich tools that haven't
8:09
been easy to locate will be part of our resource center.
8:13
Dave Coriale: And I think that's a critical piece. You just
8:15
pulled out the easy to locate, right? So the ease of use of
8:18
this resource center, and especially if it's being
8:20
redesigned, or being designed from the ground up right now, as
8:23
opposed to taking something and trying to fix it, always yields
8:25
a better user experience. And speaking of the users, who is
8:28
this targeted? Is it the CSO, the chief staff officer? Or is
8:31
it the board? Is it both? Who's the target of the resource for,
8:34
Mark Graham: Really anyone involved in government. So
8:35
what are most of the resources for?
8:36
Dave Coriale: Yeah, it certainly makes sense. I know how to run
8:36
primarily, is going to be the chief executive and board
8:39
members, but increasingly, especially large organizations,
8:40
my business, but I've been on a board, and the orientation was,
8:42
they'll likely have a chief governance officer or someone
8:44
you know, "this is our cadence of meeting. This is how we do
8:45
who's a significant portion of their time is dedicated towards
8:49
governance. These are for people who aspire to the C-suite or
8:52
aspire to serve on a board that a lot of people just think
8:55
they're going to learn on the job. And I can't stress enough
8:57
this process. This is who is the head of this. This is who's the
8:58
that's the wrong way to do it. You don't want to start making
9:02
mistakes on the job. When it comes to governance, you want to
9:05
go in fully educated on how this stuff works and where the
9:08
landmines are. I've seen too many CEOs, chief executives get
9:12
tripped up because they didn't know what they didn't know.
9:26
head of that." That's very different than what I'm hearing
9:31
here in terms of giving the team the resources they need to
9:34
really ensure that the governance is quality, right?
9:37
The assessment piece, the onboarding piece, you're talking
9:40
about the content that I could have as a board member reviewed
9:44
to understand my role better and how I contribute better. That's
9:47
what it sounds like. We're bridging the gap between I'm on
9:50
a board to what's the most successful version of the board.
9:53
Paul Pomerantz: One of the critical audiences we had in
9:57
mind, CEOs, board members. But also--so and Mark mentioned
10:01
this--that governance professional, the chief
10:04
governance officer, director of governance, sometimes manager
10:08
board operations. They have different titles, and most of
10:13
them are that, like everyone I met, is a supreme professional,
10:19
but they all come from different backgrounds. They all have
10:22
different experiences. And when people are introduced to this
10:25
job, they may not have all the foundational elements. We
10:28
developed a course that will be offered asynchronously, called
10:32
Introduction to Association Governance, and it was
10:35
originally for this group of governance staff professionals
10:41
sometimes new to the job, just to give them a common framework
10:44
to operate from. But as we've begun to develop this course,
10:47
realize it's of interest to new CEOs. And also CEOs are telling
10:53
I'd like to share this with our board. In this course, the
10:55
station in this course, which will be ready in the coming
10:58
weeks, we'll have legal fundamentals, roles and
11:02
responsibilities of the board, board selection and development
11:06
and a function of a board meeting, what you need to do
11:08
before, during and after. So the tools, as you can see, are
11:13
really intended for everybody who's part of the governance
11:16
process.
11:17
Mark Graham: Yeah, offering a micro credential in that course
11:20
you can get certified in governance.
11:23
Dave Coriale: That's awesome. You mentioned that course is
11:25
asynchronous, right? Are there in-person events also associated
11:29
with this resource?
11:30
Mark Graham: With AGI, there is. Where ASAE has two exceptional
11:35
governance in-person courses already that have a long history
11:38
and a really great programs. Blend Teck program, CEO
11:41
Symposium, the one mark Engel runs Exceptional Boards. But we
11:45
have added another one called the Governance and Strategy
11:49
Forum within the McKinley Group, which is going to have its
11:51
inaugural meeting of April 29 here in Washington, DC. It's a
11:56
two day in person event. It's designed to build the strong
12:00
partnership between the CEO and the elected leaders, typically
12:05
the, of course, the chair. But these are also open to incoming
12:09
chairs. These in person meetings we hear time and time again are
12:13
terrific to build those bonds with the chief staff and those
12:16
elected leaders.
12:18
Dave Coriale: That's awesome. There's a micro credential
12:19
associated with this in the in-person piece. I know that a
12:22
lot of work has gone into that new in person piece that you
12:25
just talked about, that's happening in April, and I'm sure
12:29
that the participants will come out with much more than they
12:33
thought they would when they went into it. And I'm aware of
12:35
the symposium and other pieces that you talked about, and
12:38
they've always had a great track record. So before we wrap up on
12:42
AGI, one of the other things that I remember hearing about
12:45
was some assessments. Earlier, you mentioned there are some
12:47
assessments too that are related to it. Who's the target audience
12:51
assessments, and what might one expect to put into it and get
12:55
out of it? If you could elaborate on that a bit.
12:57
Mark Graham: Certainly. At launch, we're going to have two
12:59
assessments, but we have more planned. But at launch, we're
13:01
gonna have two assessments. One is a CEO assessment the board
13:06
would use to evaluate the chief executive, and the other is the
13:10
board self-assessment, where the board would evaluate themselves
13:14
on maybe 11 areas to see how they do, how they function, how
13:19
they work, and compare it against thousands of other
13:22
organizations who've taken this assessment as well. So the CEO
13:26
assessment is very cool. It's four parts. It's a custom tool
13:30
there where you could enter in your own performance evaluation
13:33
of your chief executive. Every organization is different. They
13:36
have their own KPI and goals. Well, there's certain things
13:39
that are just fundamental to every organization. There is,
13:41
how will you do the job, the administration of a CEO role.
13:44
There is the leadership qualities, the personal
13:47
leadership qualities, your interpersonal skills, your
13:49
communication skills. And then, of course, we have
13:52
accomplishments and challenges that are present for every
13:54
organization as well. So this tool is an online tool that
13:58
board members fill out at the end of this survey, they take on
14:01
the chief executive. They get a report, and also the CEO takes
14:05
this survey as well, so the CEO and the board can compare how
14:08
the CEO perceived themselves in these areas compared to how the
14:11
board viewed the CEO in these areas. And the other the board
14:15
self assessment tool focuses in on, I think it's 11. Sorry, we
14:19
are working on so much here at AGI sometimes it's hard to
14:22
remember the exact number and details of these parts. But if
14:24
focusing on how the organizations, the culture, the
14:26
meetings, the policies, financial oversight, and how
14:30
well board members think they do in these areas, and again, then
14:34
we compare it to. No board is perfect. Some boards are great.
14:38
Some boards are okay. And so what we're going to get with
14:41
this report is we're going to see how you stack up again.
14:42
Stack up against a bunch of other organizations. So these
14:46
two tools were created, actually a long time ago in partnership
14:50
with board source, but ASAE has now taken them in house, and now
14:54
they'll be part of AGI.
14:56
Dave Coriale: Understood. And what's the time commitment on
14:58
the organization or the executives part on those types
15:00
of self assessments?
15:02
Mark Graham: About 30 minutes, 30 minutes. It's a thing, where
15:04
you can jump in on your phone, fill out few things, come back.
15:07
But if you sat down, really wanted to push for it, it's
15:09
about 30 minutes on each one. There is some administration for
15:13
the CEO assessment, because some of those questions are custom
15:17
assessment questions. But once those are done, the board member
15:20
can expect about 30 minutes. It's a good tool they can use
15:23
year after year and track their progress, board self assessment
15:26
and the CEO assessment, so they can see where they're doing
15:29
better and where they still have some work to do.
15:32
Paul Pomerantz: It's a wonderful tool. I've seen it used. I've
15:34
used it on my own board, and I've worked with other boards.
15:38
And what it does is it provides that opportunity for the board
15:41
to give itself feedback. This is a board self-assessment, and
15:44
boards could be their most critical evaluators. And so it's
15:49
one thing for a CEO that say, you guys could be doing better.
15:53
It's another one for the board itself to look at this and say,
15:57
we could be doing better. And so when properly done and
16:01
facilitated, these instruments are incredible because the board
16:05
identifies not only its strengths but its weaknesses,
16:08
and gets to compare itself with its peers. And so that's really
16:11
eye opening for board members. The eyes light up. They get
16:14
excited, and they're engaged about how do we move forward?
16:17
How do we become better? It's a great tool for self improvement.
16:21
Mark Graham: These tools are completely confidential. The
16:23
board members are not going to know who answered to what
16:25
questions, so it really gets some honest feedback of the CEO
16:29
and of course, the board.
16:30
Dave Coriale: Yeah, that's a really important point to make
16:32
in ways you want to ask also, one of the things we love to do
16:35
in this community is benchmark ourselves against others, right?
16:39
Will there be as you collect data across time, even though
16:42
it's anonymous, will there be the opportunity to see where
16:44
your ratings stand against other organizations?
16:48
Mark Graham: Yeah. In fact, in every report, you will see every
16:51
single category, almost every single question, how you stack
16:53
up against all of your peers, because this poor self
16:57
assessment has been administered for gosh, I drew my math here,
17:00
16 years, we have an enormous amount of data, awesome to pull
17:03
from. The CEO assessment is not a benchmarking tool. And it
17:07
shouldn't be, for probably reasons. But the board
17:09
self-assessment, you'll be able to see how you do, yeah, and
17:12
year to year, if you do the report every year, every couple
17:14
years, you can just go back to the little report and see how
17:17
you did.
17:18
Dave Coriale: So speaking of how you do, is one of the key
17:21
aspects of this. How are we doing as a board? How are we
17:23
doing as a chief staff officer? Paul, you started this thread.
17:26
You started this conversation around the CEO is successful, or
17:30
the chief staff officer is successful when governance is
17:33
solid, paraphrasing a little bit there. But you're saying
17:35
governance a good place. CEO has much more likely chance of
17:38
success. And I know you also mentioned earlier, culture
17:42
playing a role in that, and that's something that I feel
17:44
like you've focused on. You've written some articles about it,
17:47
you've talked about it. I've heard you talk about culture,
17:50
fair assessment, fair statement. That's important as far as
17:53
success goes beyond just the operational aspect.
17:56
Paul Pomerantz: Yeah, I would say it's probably the most
17:58
important aspect and the least well defined.
18:01
Dave Coriale: I was going to ask you to start by defining what
18:03
when you talk about culture, how do you define it?
18:06
Paul Pomerantz: Greatly, it's like that famous quote by
18:09
Justice Potter Stewart. I notice when I'll know it when I see it.
18:13
He was describing pornography in those days. So probably not a
18:17
great analogy, but culture, we're going to end up with an
18:19
explicit rating, exactly, you know, and your kids listening to
18:23
this. But no, all kidding aside, the culture really refers to
18:28
what groups value, what they believe in, and how they behave
18:34
towards each other and to others, and it really reflects
18:38
The norms of behavior. And what's interesting is that
18:42
culture is not defined by what people say they are. So one of
18:46
the big misinterpretations out there is, well, the board
18:50
values, right, or the organization values they
18:53
represent your culture. They may not, because the culture is
18:57
really how you live, how you behave, people. And I'll say
19:01
Mark Engel again, he has assured with me, and I truly believe it,
19:05
that there are three pillars to governance, strategy, structure
19:09
and culture. And the if you think about it, strategy is your
19:14
direction, structure is the hardware, right? How's the board
19:18
organized? How many board members are there? How's it
19:20
staff, all those kinds of things. But culture is the
19:24
software. It's really how it works. It's the operating system
19:28
that really makes the board operate. And the literature is
19:32
full of examples of when culture doesn't work properly. They go
19:36
back in the last couple years, we've had issues on the media
19:41
with the National Association of Realtors, where culture broke
19:44
down, the organization was blind to activities that took place
19:48
within the organization that was very costly for a reputation of
19:52
the National Association of Realtors, certainly in the
19:55
corporate sector and the for profit industry, many examples
19:59
and we can point to. To really the very high profile experience
20:03
with Enron, going back to the turn of the century, where, you
20:07
know, that led to really the downfall of that company,
20:10
because the board was not paying attention to things it should
20:14
have, and accounting was hidden. It was falsified. And really
20:18
resulted not only in the downfall of that company, but
20:21
new laws and regulations such as the Sarbanes-Oxley Act that
20:25
really required a high degree of transparency, and we can go
20:28
through examples in this article I wrote for more brief, there
20:32
are many examples where it's just very costly, where, when
20:37
the culture breaks down, it could be extremely costly for
20:41
the organization. Interestingly, people would say, what's a an
20:45
example of the good cultures of people getting along? Is it
20:48
people being very civil with each other? And I'd say, no,
20:51
it's really the reverse. It's where boards are inquisitive,
20:56
where there's healthy disagreement, where there's
20:59
healthy curiosity, there's robust discussion of issues
21:03
where people are held accountable. There's
21:05
accountability of the staff. There's accountability to each
21:09
other, and the board is engaged in a very rigorous process of
21:13
self evaluation, evaluation of the organization and
21:17
accountability. They're asking the tough questions about their
21:20
industry. They're asking the tough questions about the
21:23
organization and how well they're doing. They're asking
21:26
tough questions about their competitors in the competitive
21:29
environment that they're in. I think we sometimes falsely seek
21:33
in our organizations a degree of camaraderie that may not
21:37
necessarily be healthy. And one of the things we talk about in
21:41
the article is that association boards are especially vulnerable
21:46
to this false sense of harmony. And the reason is, in
21:49
associations, you got people from the same profession or same
21:53
industry, and we're less likely to be critical to call each
21:57
other to account, because I'm going to rely on you. Let's say
22:00
you're in my profession to help me to advance further. I want
22:04
you to like me. I don't want to call you out, because then
22:06
you'll call me out. But in the contrary, that false harmony can
22:10
be very detrimental to the organization. So I hope that
22:14
makes sense, and what we talk about in the article is, how do
22:18
you evaluate your culture, and then what are some of the tools
22:21
and resources that are available to help check in and improve
22:24
that culture? It's not all that hard. It's really just asking
22:27
the right questions. The board self-assessment is clearly a
22:31
tool you can use the CEO selection and evaluation. That's
22:36
a very critical resource you want to make sure that the CEO
22:40
has been somebody who has had experience building a culture,
22:44
building a partnership with the board, sets the model for a
22:47
healthy culture. In an organization, you want to
22:50
recruit board members who have similar types of experiences
22:54
that are good at this. They understand what they're trying
22:56
to do. Look at the board agendas over time. That's another tool
23:00
as well. Boards with a healthy culture will spend more time on
23:05
strategic items and generative items. They're going to spend
23:09
more time exercising their curiosity and asking tough
23:12
questions. Boards that have a weaker culture are going to
23:17
spend their time on operational issues and micromanagement. Why?
23:21
Because it's easy way of getting out of the tough issues. You
23:25
really want the board focused on the tough issues. Another thing
23:28
that many boards are doing is they're bringing on public
23:30
members and other perspectives to create a diverse, diverse
23:34
points of view. So if you have a board that's we're all from the
23:38
same industry, we're all used to talking to each other, bring in
23:42
different perspectives, bring in a member of the public, bring in
23:45
a customer of members, either as a member of the board or on an
23:49
infrequent basis, to help challenge the board and then
23:52
lean into the bad news. What I found is boards tend to avoid
23:56
the bad news until it's too late. What you want to do is, if
23:59
you had a bad record financially. You want to talk
24:03
about that. What does that mean? The industry is facing some
24:06
tough times. What are you going to do, and how are you going to
24:08
address that? That you've had a staff engagement survey, there
24:11
are some signs of stress among the staff. How do you present
24:15
that to the board and talk about that? But leaning into the bad
24:18
news, having those frank conversations is very much part
24:21
Dave Coriale: So there's a lot in there, right? I'm trying to
24:21
of that.
24:25
listen and parse all the way through that, and it all made
24:27
sense. You asked in the quite in the middle of that, you said,
24:28
that does that? If this makes sense, it all made very good
24:32
sense. Culture eats strategy for breakfast, right? So culture is
24:36
one of those things that you have to have your eye and it's
24:38
also always known to be one of those things that it's really
24:42
hard to change. You can't execute a new culture like you
24:46
use the word. You have to build it. You have to push towards it.
24:49
And you tied that to the values of the organization. And when
24:53
there's misalignment between values and action, is what it
24:56
sounded like to me, fair assessment, that we have values,
24:59
that there. The website we're done with that. Let's move on.
25:03
That's a critical piece that can fall apart when you're not
25:06
paying attention to it.
25:07
Paul Pomerantz: Exactly. I've seen too many boards say and
25:10
come up with values that don't really reflect who they are. So
25:15
our value is customer service. Our value is civility. Now you
25:19
really got to break down, what do you really mean and what do
25:21
you truly live? And I'm going to modify your quote there, culture
25:26
eats strategy. I'm gonna say culture eats CEOs. What happens
25:30
is, if a CEO knows how to manage culture, understands culture
25:35
knows what to look for, they're gonna do well. But what I see
25:40
too often is that CEOs will enter organizations not really
25:44
familiar with the culture that they're walking into, not sure
25:47
how to measure it, not sure of their compatibility with the
25:49
culture, and try to redefine strategy or their role or change
25:56
culture without really knowing how to do it. And we see those
25:59
stories all the time, and having a cultural competency is really
26:04
important for a successful CEO, particularly as it comes to
26:07
working with governance.
26:08
Mark Graham: Well, we'll add though, culture can sometimes be
26:10
the third rail in organization management, because a CEO goes
26:14
in there, they can see the culture is not well, but to
26:17
change it, they may have to tackle their own board of
26:19
directors. I've seen many associations CEOs going, Nope,
26:23
it's just not worth it. I'm going to just go with the status
26:25
quo. And sadly, that's really one of the reasons why we want
26:28
AGI to be successful. We believe in excellent governance. We want
26:31
to give people the tools to maybe tackle that third rail,
26:35
even though it's a little intimidating. But if culture's
26:37
eating things again, yeah, I think it is eating CEOs and
26:41
strategy, probably a few other things.
26:43
Dave Coriale: It's such a big word, and so I'm wondering if
26:45
there is an assessment. Yeah, I think you mentioned there is an
26:47
assessment. Are there ways to assess culture as a new CEO
26:50
walking in? Because one of the ways we define it is how work
26:53
gets done. Right here at Delco, we say culture is how our work
26:56
gets done, and we're not talking about the process that we go
26:59
through. We're talking about what you talked about, Paul, in
27:01
terms of whether or not we communicate with each other
27:04
frankly and honestly, or if we just want to get along for the
27:07
moment, whether or not we challenge each other. That helps
27:10
us define what we mean by culture. But in the AGI content
27:15
and assessments, how does the CEO get help assessing their
27:19
culture?
27:19
Mark Graham: I think when Paul and I first adopted the board
27:22
self assessment and took a look at it, we made some minor tweaks
27:27
to it, to update it, modernize it for 2024. But he and I saw a
27:32
huge opportunity to really upgrade this. So we're already
27:35
in the planning stages of version 2.0 of the board
27:36
assessment, and really drilling down on culture, because we both
27:38
believe it's very important, because this is a benchmarking
27:39
tool, you need to make these changes like once or twice. You
27:41
can't just make iterative changes to a benchmarking tool.
27:42
So we made very small changes to it for this first version, but
27:54
this next version that Bucha and I were working on in 2025 we
27:57
hope to really drill down on culture. I'm not sure if it's
28:01
going to help CEOs going into an organization, unless executive
28:04
recruiters require boards to take this self assessment before
28:08
entering into a search phase. But at least when they're in
28:10
there, the board, the CEO and everyone who reads this report
28:14
might know where they're weak and where this improvement to be
28:16
had
28:17
Paul Pomerantz: And I'll add to that that the courses that ASAE
28:21
offers at CEO Symposium, Exceptional Boards. These offer
28:26
opportunities to talk about culture. I think there's good
28:29
content in there that Glenn Techer and Mark Engel and others
28:32
offer that allow for that frank discussion about things. The
28:37
other thing I'll say is that if you come in as a new CEO and you
28:40
say, All right, I'm going to address this culture, and I'm
28:42
going to have that changed in six months. That's not how it
28:45
works, a slow process. You work by example. You work
28:49
iteratively. Your organization will live by the example you
28:52
set. By your example of transparency. By your example of
28:56
collaboration, your example of how you raise issues and discuss
29:00
issues, you'll begin to shape the culture that you want to
29:03
achieve. I think that the organization I came from, the
29:07
American Society of Anesthesiologists, we had a very
29:10
cumbersome structure. It was nothing that anybody would say
29:14
that they would want as a governing structure, House of
29:17
Delegates, large board. We had a even a third tier, because with
29:21
the board was so large, called our administrative council. But
29:24
what worked was the culture. We really emphasized having those
29:28
discussions. We emphasize accountability, we emphasize
29:31
transparency, we lean in the controversial items, and the
29:35
members really appreciated it and were able to get things
29:38
done. And I think that's how you do it. You set the example you
29:41
build trust, one board at a time, one president at a time,
29:44
and you'll get to where you want to get to.
29:46
Mark Graham: Paul is talking about building this culture. AGI
29:49
is going to give people tools to have room to build that culture.
29:53
Paul led a webinar that will be on AGI called we love this
29:57
title. Everyone hates your board meeting and. One of the tidbits
30:00
in there from one of the participants was they give video
30:04
presentations of the reports from the organization in advance
30:07
to the board meeting, and they can watch it beforehand, and
30:10
they can answer questions about it at the board meeting, but the
30:13
CFO is not going to the board meeting and giving a financial
30:16
report eating up valuable time. It's a valuable report. I don't
30:19
want to take away from that, but if you're giving more time in
30:21
the board meeting time, by having that information
30:24
presented at events, we're giving you more time for the
30:27
strategic discussions that you need to have, the long term
30:30
discussions changing the culture of the industry and
30:32
organization. So practical tips can be found inside AGI to be
30:36
that room.
30:38
Dave Coriale: Doing this work of challenging each other and
30:39
having these conversations like you're describing without being
30:42
a jerk. That's really the success of the culture you need
30:45
to build, which is challenging each other, being candid,
30:47
leaning in, like you said, to the problems, but everyone needs
30:51
to be civil and in our environment, in our association,
30:54
501c culture, as a community. It is we're generally nice people,
31:00
right? So it challenges us to be challenging to each other, but
31:03
fortunately, we're mostly nice people who can do it in a way
31:07
where it's not going to turn into something that's
31:10
acrimonious among the participants. So hopefully
31:13
that's the outcome. But culture is not a new word, certainly. Is
31:16
this a trend, though? Are CEOs paying more attention to culture
31:20
than they did 15 years ago. Do you feel like I think so?
31:24
Paul Pomerantz: What I'm seeing is more attention to that and
31:27
really trying to understand the work that's getting done. That's
31:30
a discipline generally within the business world. In general,
31:34
you go into a lot of organizations now, bigger ones,
31:38
they have corporate anthropologists and business
31:40
schools are teaching business anthropology, and I think to
31:43
some degree, all that is heading into the association world as
31:47
well. Some of the consultants that I'm familiar with have
31:51
really begun to pay attention to culture, and a lot of the people
31:54
that Mark and I are working with a CEO Advisory Committee really
31:58
are attuned to the culture in the organization. And like you
32:01
say, how work gets stuck.
32:03
Mark Graham: Search teams are created tuned to this as well,
32:05
and when they place the chief executive, it's in their best
32:07
interest to have a long, fruitful, happy relationship. So
32:11
they don't want to put someone into a mismatch. So they're
32:14
doing assessments and doing the evaluations on the board and the
32:17
CEO to find out a better marriage.
32:20
Paul Pomerantz: Yeah. Well, what I would say is that CEOs who may
32:24
succeed on business measures, and they may succeed on culture
32:29
measures, they'll get fired for failing on culture business,
32:35
they'll be more forgiven. And I've seen this time and time
32:38
again, where you see an organization with stronger
32:40
results, but you have a cultural mismatch, and it just doesn't
32:44
work. I would say that this is the most critical of skills for
32:48
effective governance.
32:49
Dave Coriale: I want to hit on one more topic before we wrap
32:52
up, and that is, and Paul, you were nice enough earlier to
32:55
bring me into the conversation by talking about the hardware
32:57
and software, because I'm a tech person, right? That's what we do
33:02
here at Delcor. Word technology alignment with mission, vision
33:04
and business objectives. And one of the things that I've seen in
33:08
governance is a struggle between the staff and the boards as it
33:14
relates to the technology integrating with the strategy.
33:17
I've said this a million times, that 10 years ago, we as
33:19
technologists were order takers. Tell us what you want. We'll
33:21
build it or buy it or buy it for you. Good luck. Now there's an
33:24
opportunity for true strategic participation and saying, "Tell
33:27
us your vision, tell us your objectives. Let us help you with
33:31
the fidelity around the edges of that because we might know
33:33
things you don't in setting that strategy or setting that
33:36
objective." We might know capabilities that the
33:39
organization could have. What do you feel like the role of the
33:42
board and the governance body is as it relates to technology
33:46
within a well functioning organization?
33:49
Paul Pomerantz: I don't think it's ever been more critical.
33:51
And it's funny what you say. I go back to when I first started
33:54
in the industry, and that was in the last century, back those of
33:57
the 19th century, roughly, and it was exactly what you say, but
34:02
somebody else does that. It's a lower level task. Now it's it's
34:05
not only a C-suite function, but the CEO is really expected to be
34:09
conversant in the strategy and issues surrounding technology.
34:12
And I think it comes down to a couple areas. One is assuring a
34:17
seamless and excellent experience for the
34:21
organization's constituents, whether it be its members,
34:24
external stakeholders, whoever it is, the board has an interest
34:28
in making sure that the organization is engaging
34:33
accessible, that the experience of people who interface with the
34:38
organization And the whole interface is technologically
34:41
based, is a good one, and that we're getting information and
34:45
we're learning from each person who comes in boards. Want to
34:48
make sure that that experience is there, and that they're
34:50
gleaning the information that comes from that. The second
34:53
area, I think, deals with emerging technology, and
34:58
particularly around AI. That has become a strategic item for
35:02
virtually every board I talk to how is AI going to be used? How
35:06
are we managing the risks of AI as well as the upside of AI? Do
35:10
we have an AI strategy? How is it going to help us
35:12
competitively, and how are our competitors using it? How are we
35:16
using it and really looking through the future? How are we
35:19
understanding its capabilities and moving forward. And the
35:22
third area, I would say, would be in the risk management. The
35:26
whole area around cyber crime. Cyber Risk is keeping every
35:32
board I know up at night. Now, the larger the organization, the
35:36
more pearls the risk, the more chance for the organization to
35:40
be hacked for information to get out there, and then the deal
35:44
with that. And so boards want to make sure that there's a good
35:47
strategy towards dealing with the cyber crime, cyber risk, and
35:51
that the CEO and this team are really on top of that, including
35:56
that not only staff need to be well trained in dealing with
36:00
cyber risk, but the board itself, and really all the
36:03
commitments anybody interacting with the organization needs to
36:06
be cognizant of the risk factors. So those are three that
36:09
come right to mind. Mark, I may have missed some items there.
36:13
Mark Graham: Again Paul, perfect. I have nothing to add.
36:15
Dave Coriale: Then I will ask you both to add one thing as we
36:18
close out. First of all, I appreciate you spending the time
36:21
and explaining this. This the AGI, sounds like an awesome new
36:24
resource for the community. I would like to know what advice
36:28
you would give an association leader that is looking to build
36:32
that healthy culture and board relationship in 2025. What do
36:36
you both have to say? We'll start with you, Mark.
36:38
Mark Graham: I think it really comes down to spending time
36:40
together and building that personal relationship, because
36:43
that's where you're going to build, the trust, where you can
36:45
be candid with each other. Paul spoke earlier, delivering bad
36:48
news is much easier when you have a strong personal
36:51
relationship with someone. For me, my recommendation for any
36:55
chief executive with their board is spend more time with them.
37:00
Paul Pomerantz: I thoroughly agree with that. And the other
37:02
thing I'd say is, it's no secret, we're in a tough time.
37:05
The world has been turned on its head. We're trying to understand
37:09
this world that we're in, and I think having frank discussions
37:12
with the board that talk about, what are the risks now to our
37:16
organization, our professional industry, and what are the
37:18
opportunities? And one of the tools that we talk about, it's
37:22
in a lot of materials that the AGI has, is and it's and will be
37:27
discussed in the issue of board brief that'll be coming out soon
37:30
is the use of generative discussions at the board level.
37:33
In other words, having a discussion at the board that's
37:37
not about finding answers, but it's about understanding and
37:41
just as a board discussing, what do you see as the new risk? What
37:45
do you see as new challenges to you? What's your experience in
37:49
your profession and your business, and how's it changing
37:52
now? And what are some of the things that our association
37:54
needs to be paying attention to? So it's really trying not to try
37:59
to avoid the controversy, but as we said before, lean into it a
38:04
bit. Don't create argument, but try to understand it. How are
38:07
different members of your organization, different
38:10
generations, different ownership models, how are they
38:13
experiencing the changes we're seeing taking place, and how do
38:16
we best navigate it as an organization?
38:19
Dave Coriale: I love that piece in there, you said, try to
38:21
understand it. It's a human nature. It's a common thing,
38:24
especially when you're pressed for time, or don't have the
38:26
relationship that you talked about, Mark to start assessing
38:29
blame, as opposed to trying to assess and understand. So I
38:33
think that's a super elegant way to put just try to understand it
38:37
before you start solving it. Especially, and if I may be so
38:40
bold, to offer my one piece of advice to this CEO and to the
38:43
board, et cetera. It is something that you touched on a
38:46
second ago, which is, don't cut spending on cybersecurity. We
38:50
work with a lot of IT leaders, and It shocks me the number of
38:53
organizations that the head of it is putting in the budget some
38:57
type of cybersecurity, whether it's a tool to further protect,
39:01
or it's education which is also going to protect, and they come
39:05
back, and that's been what's cut. Yes, build a mindset of
39:08
cybersecurity first in your organization. So again, thank
39:11
you. I look forward to seeing you both in 3d in real life some
39:16
point soon, but I appreciate very much the time we spent
39:19
together here.
39:20
Paul Pomerantz: Thank you, David. This was fun. Yeah, lot
39:22
of fun. Thanks, David.
39:23
Dave Coriale: Thanks everyone for listening to this episode of
39:25
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