4 Steps to Building a Board of Directors That Lessens Your Stress How to set your company up for success, and yourself up for happiness.
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As a leader, your board of directors is one of your most important and strategic partners. Your company's success depends on the effectiveness of your board. Your board can help you course-correct, identify opportunities to expand your reach, fundraise, especially if you're a not-for-profit entity, manage risk, and build the company's brand. This will help you reduce stress and help you improve your overall wellbeing and health.
Stress is directly related to your health. Stress inhibits your immune system, making you less able to fight off attackers such as viruses and bacteria. You become more prone to infections, frequent colds and flu, shingles, yeast infections, rheumatoid arthritis, and even warts. Stress also will impact your sleep. Stress causes an imbalance in your hormonal system and causes the release of stimulating hormones such as cortisol. These hormones can cause sleep disturbances. The impact on your work can be significant. You become irritable, more easily distracted, less creative, and less able to draw links between information. This will impair your relationships, both at work and outside.
Related: 5 Reasons Why Even Small Companies Need a Board of Directors
Research has found that spouses with fewer sleep problems tend to experience higher levels of happiness. So, it's important to think carefully about the evolution of your board. Here are four steps that you can apply to build an effective board.
Step 1: Expand your strategy and business
When building your board, it's important to select board members who represent a wide range of perspectives. You should select board members from diverse areas of expertise. This will help you gain access to new ideas and expand your reach and strategy. After all, your board is supposed to help you with strategy and business connections, and expansions and partnerships into new markets. They need to relate well to others and represent diverse backgrounds and perspectives. Try to prioritize gender diversity. Research has shown that gender diversity increased board attendance and effectiveness. When your board is composed of a wide range of viewpoints, it's able to navigate the complex issues that your company is facing and think outside the box. It's also able to avoid groupthink and anticipate challenges and risks, which will help you manage risk, gain confidence, and reduce your stress levels. You'll surely sleep better at night. Your board is a powerful resource. You owe it to yourself and your team to focus on structuring it with diverse perspectives that can help you manage risk and expand your reach and impact.
Step 2: Prioritize good business practices and ethics
Ernest Caldecott, American Professor of Physiology, once said, "Ethical living is the indispensable condition of all that is most worthwhile in the world." As a leader, ethics should always come first. You want to be surrounded by people who you can trust and who you know will act in the best interests of you and your team. So, it's important to make sure all board members, whether they are non-profit, community, or for-profit members, understand and commit to their fiduciary duties. Make sure they are great community members, both in your region and in your industry. If there are any red flags that members won't act honestly and in the best interest of your company, you should confront them, the earlier the better. If they are unwilling to comply, you should politely ask them to step down. When you prioritize ethics, you build an incredibly powerful brand. You're able to reduce your stress levels by gaining confidence that your board will act as an effective public face for your company.
Related: 10 Tips for Forming a Board of Directors
Step 3: Ensure strong communication
Great leaders maintain constant and consistent communication with each and every board member. You can do this by holding regular board meetings at least once a quarter. Preparation is everything. You should prepare thoroughly for meetings. And you should send out clear and concise board decks well in advance of meetings. Try not to dominate the conversations. Your board members have valuable insights and deep expertise to impart. You should encourage discussion and diverse viewpoints. Try to make board meetings interactive and engaging. You can keep the pulse going in between meetings by sending out updates in between board meetings when there is relevant information to share. When you establish strong communication channels, you get the most out of your board. By keeping them informed, you also gain confidence that they will accurately represent your organization in public.
Step 4: Refresh your board and outline a succession plan
It's important to constantly check-in and re-evaluate the composition of your board and its committees. You can partner with your board chair to ensure that your board members are expanding their skills and motivation to be most effective as the company continues to evolve. And as your company evolves, you should evaluate whether you need to recruit new members. You should outline a succession plan to ensure that you're able to fill spots quickly if any current board members step down. When you structure your board to meet the evolving needs of your company, you set your organization up for success. You also ease your anxiety and stress levels knowing that you have highly capable and passionate advocates to propel you to success.
Related: What's the Difference Between an Advisory Board and a Board of Directors
When you have a board that represents you and your company well, it affects your entire team and how you're perceived by outsiders. This includes customers, partners, distributors, and the world. What could be more important? So, take these four steps to build an effective board.
