2012

Issue 11

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BoardWorks International
Issue 11, 2012

Nine Sources of Misplaced Aggression in the Boardroom

Unfortunately aggressive behaviour is not rare in boardrooms. It is likely that most people working in and around boardrooms will encounter this at some stage in their governance careers. Recently, I observed a board meeting in which one director was unduly and inappropriately aggressive. Apparently this was not unusual and, over time, there had been increasingly negative consequences for relationships within the board and between board and management. The productive passage of the board through its meeting agendas was regularly high-jacked by this person’s belligerence. His colleagues talked about ‘walking on egg shells’ so as not to not ‘set him off’. Members of the executive team dreaded board meetings not knowing when there would be another ‘full frontal attack’ on them.

It was tempting to dismiss this particular director as no more than a boardroom bully inclined to try and impose himself on every situation. This would have been a misleading oversimplification.  As more information about this particular situation came to light it underlined that there are many reasons why inappropriately aggressive behaviour might become apparent.

  1. Adverse operating assumptions

    One of the leading causes of inappropriate boardroom aggression is a genuine belief on the part of the aggressor (as it was in the case referred to above) that this is the ‘correct’ behaviour in the boardroom. It is taught behaviour in some ‘schools’ of corporate governance and it has its roots in ‘agency theory’.  Agency theory emerged in the 1970s from the academic discipline of financial economics. An agency relationship arises when one or more individuals (‘principals’), engage other individuals (‘agents’), to perform some service and delegate decision-making authority to those agents. The theory posits that there are inherent agency conflicts between principals and agents. In particular, it views agents as inherently inclined to take advantage of their principals. Consequently, a system of incentives and sanctions is needed to moderate these conflicts and reduce ‘agency costs’. (1)

    Looked at this way there are agency relationships between shareholders/members and their boards and between boards and their chief executives. Board members most strongly influenced by this form of thinking often describe their role as ‘keeping management honest’ or some similar phraseology. It is only a short step to behaving in an antagonistic manner towards (inherently untrustworthy) executives. The most likely response by executives to this type of board member aggression is defensiveness.  This simply adds fuel to the fire. It provides ‘evidence’ to an agency theorist on the board that management has something to hide. Pushing even harder (i.e. more aggressively) is therefore necessary to uncover their undoubted wilfulness.

    Not only does this frame of reference create tension between ‘aggressor’ directors and executives but other board members often find the fundamental lack of trust involved, and the behaviour that goes with it, offensive.

  2. A sense of workload and commitment inequity

    It is rare for boards to be comprised of a group of people all contributing to their full potential. There will often be a sub-group doing most of the ‘heavy lifting’.  It is this group that carries out, for example, the close scrutiny of organisational performance, the detailed analysis and critique of business proposals and the subsequent questioning of management. If other directors are seen as less diligent or even less competent the heavy lifters’ sense of inequity readily spills over into aggression towards their less active colleagues as well as towards management. It is as if they feel obliged to escalate their ‘diligent’ questioning of management to an even higher (i.e. more aggressive) level.

  3. Personality mismatch.

    Some people are naturally more assertive and/or sharper in the way they conduct and express themselves. In some situations this may be experienced by others as unduly aggressive and out of synch with long-established norms of behaviour in the board.  People who see themselves ‘take control/get things done’ types of people behave in a manner that is often experienced by colleagues as being ‘steamrollered’.  These are the people who are difficult to say ‘no’ to because they are usually willing to volunteer to deal with time consuming, difficult or even unpleasant tasks on the board’s behalf. They may not be overtly aggressive in their behaviour but they are perceived to manoeuvre themselves into a controlling position on the board.

  4. A lack of boardroom-specific skills

    Boardrooms are fundamentally places of learning. They depend on a high level of skill and capability in the process of inquiry. Unfortunately, even if they know broadly what to inquire about, very few board members are taught how to ask questions. There is a fundamental difference between questions that are expressed as ‘learning’ questions and those that are judgmental in nature. The latter will almost always come across as aggressive and produce a defensive response. This is typically the way most TV and radio journalists conduct their interviews. The type of contest it engenders between questioner and questionee is simply out of place in the boardroom environment. The best boards conduct a collaborative but rigorous dialogue that is results in deeper and broader understanding of the matters they are responsible for. 

  5. Lack of emotional intelligence.

    Some people are unused to having to conduct themselves in a sophisticated manner in a group decision making environment. They are accustomed to a high degree of autonomy in their decision making or to environments where others defer to them. They lack empathy with others and have a low level of self awareness of the impact of their behaviour on others. As in other types of groups, undue aggression may be little more than a primitive attempt to establish a status ‘pecking order’. In the boardroom, status should be irrelevant as all board members are equal in the eyes of the law.

  6. Lack of understanding about the board’s governance role

    The demands of what is essentially an intellectual process are not easily met (or understood) by many who find their way to the boardroom. Frustration that they cannot do the type of hands-on operationally oriented work they are really interested in causes some board members to become frustrated and behave badly. This in turn frustrates and causes a reaction in others around the table who want to get on the with the board’s real governance work.

  7. Mixed capability

    Some board members are brighter intellectually than their colleagues to the extent that their ‘I don’t suffer fools’ attitude is experienced as disrespectful and threatening to others. There are frequently situations where their intellect is used as a weapon to put others down.

  8. An excess of self interest

    Overt aggression towards colleagues in order to put them down or make them look bad is particularly visible behaviour in organisations that are political in nature (e.g. city councils). Board members see their advantage in aggression of the win-don’t lose variety. ‘Beating up’ on colleagues and ‘points scoring’ are often deliberate behaviours. These board members aim to enhance their public political reputation for being defenders of the public interest, ironically, against their supposedly more ‘self-interested’ colleagues. Behaviour need not be overt to be considered aggressive in such environments as the effects of ‘leaking’ confidential material to the media shows.

  9. Socialisation

    Another factor is learned behaviour. People whose formative years have been spent in aggressive ‘dog eat dog’ environments often find it difficult to adapt to the necessarily more collaborative, collective responsibility of the boardroom. In New Zealand, for example, we have observed some former members of Parliament who have found it difficult to adapt to a boardroom role. Parliament and party politics can be a brutal and punishing environment which teaches people, as a matter of survival, to ‘shoot first and asks questions later.’ This type of behaviour is an understandable survival technique but one learned in another environment that does not transfer well into the boardroom.

    Interpersonal aggression in the boardroom seldom plays any useful part in a board’s work. It is at least a distraction if not a source of fundamental dysfunctionality.  When members of a board feel under threat from boardroom aggressors, various manifestations of the normal psychological responses to fear become apparent: fight, freeze, or flight. Each one of these responses detracts from the board’s performance. Boards must work hard to establish - and apply - norms of behaviour which help rather than hinder their effectiveness.

Notes

(1) For a potted version of agency theory see http://www.enotes.com/agency-theory-reference/agency-theory . Note that agency theory is the fundamental underpinning of performance-based remuneration. For an opposing view see http://www.boardworksinternational.com/periodical/2010feb_article4.html

 

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