Boards of directors in family businesses can be powerful tools for success. Yet they’re often underutilized. In some cases, management may not fully understand the board’s role and responsibilities. In other cases, a lack of trust makes it difficult for the board to operate effectively.
Regardless of the why, boards of directors are underutilized. One way to improve the effectiveness of your family business board is to define the family director’s role.
Family directors tend to lack experience as professional board members. This leaves them unsure of their ability to contribute effectively. They feel out of place. And they often remain silent, diminishing the board’s overall impact. Their insecurity can also manifest as criticism, confrontation, or defiance. This type of behavior can disrupt board meetings and even harm boardroom culture.
The family director’s unique role is to bridge communication between the family and the company. To do this, they must have clear expectations of the role they’re assuming. When properly prepared, family directors are unstoppable. Their involvement demonstrates the family’s commitment to the business. And it reinforces continuity for external stakeholders. By defining the family director’s role, you’re ensuring their competency.
For three additional ways to improve your family business board’s effectiveness, read “Towards Board Excellence: Lessons Learned from Family Business Board Evaluations.”
Read about the four ways to improve your family business board’s effectiveness here.
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