Boards are living through a time of unprecedented challenges: IPOs, acquisitions, divestitures, shareholder activists, and CEO changes. At the recent Board of Directors Summit, three distinguished panelists—peter browningPrincipal Director of ScanSource and Director of GMS. patricia russoChairman of HP and Director of GM, Merck, and KKR. and maggie wilderotterChairman of DocuSign and member of the boards of directors of Costco and Sana Biotechnology, shared insights from his decades of board experience.
Their panel discussion provided a master class on how boards can provide steady guidance and leadership during times of turmoil. Below are key takeaways for CEOs and boards of directors looking to maximize their impact.
1. Fostering trust in the CEO-board relationship
As Mr. Wilderotter pointed out, the power relationship between the CEO and the board is fundamental to good governance. Directors need to help CEOs steer the company while also holding them accountable, and this requires trust, transparency, and mutual respect. “The top priority for every board member is to get the right CEO in the right seat on the bus at the right time and value that CEO as a leader in the company,” she said. “But also, in the context of increasing shareholder value, that is the mandate of our board: the ability for the CEO to listen to the board, learn from it, engage with the board, and guide the board accordingly. It's also important to do what he or she does every day. ”
Russo shares a powerful example from her time as CEO of Lucent, describing a trial by fire that shaped her view of CEO board dynamics and taught her that hand-wringing should be left at the door. Ta. “I first stepped into the CEO role about 30 days before the telecom collapse. I was the new CEO of a publicly traded company, and it was a crisis that I could never have imagined,” she says. said.

“Everything went wrong. We were running out of cash, we were under investigation by the SEC, our industry was cut in half, and our customers wanted us bailed out. Three companies came to me and said, , said she had to file for Chapter 11 in time.'' Russo had to rely on her board. “We just happened to have a great committee, and the response to the people on that committee was, “How can I help you?'' So that when I got to the other side, I was able to be constructive and productive. ” She also learned the importance of keeping your hands in front of the door. “I didn't have a hand wringer. Hand wringer people are people who are concerned about themselves, not the company.”
Important tips: The CEO-board relationship thrives when directors serve as trusted advisors and provide constructive input without compromising leadership.
2. Encourage dialogue, even when opinions differ.
Boardrooms are inherently diverse, bringing together individuals with different experiences, perspectives, and even political beliefs. But to lead a company effectively, this diversity must lead to thoughtful and actionable dialogue, not conflict.
“Sometimes you hear something in a boardroom and think, 'That's the stupidest thing I've ever heard,'” Wilderotter quipped. “But what comes out of your mouth is, 'Let me understand why you think that's going to be a good thing for us.'” Because as a board member, what you want to do is Because I think it's about making sure that the dialogue doesn't get shut down, especially when you're making important decisions and critical decisions. ”

Mr Browning highlighted the role of the lead director or non-executive chair in fostering this environment. “All directors should feel heard and disagreements should remain constructive. If the board cannot reach an agreement, the lead director will mediate and ensure discussions are productive.” It is your responsibility to make sure that you are on target.”
Russo added that CEOs play a key role in shaping board dynamics, especially by creating an agenda that prioritizes meaningful discussion. “The best engagement is when the CEO-sanctioned presentation is just five or six charts. They're not just a bunch of documents with a lot of fine print, they're an important idea; Here's what you need to do, and then there's plenty of time to participate and discuss. ”
Important tips: Directors must create a space for honest and respectful dialogue, especially when opinions differ. Lead directors must address disruptive behavior head-on to maintain board cohesion.
3. Be courageous in your decisions
Boards often must make decisions that are unpopular in the short term but necessary for the long-term health of the company. “There was a time when many drug companies were cutting back on research and development to increase their stock prices, but Merck never went down that path,” Russo said. “Our stock languished at $60 to $65 a share because we sat around the table and said, 'No, we're not going in that direction.' Merck ended up developing the largest oncology drug on the market today, with a stock price of $120. But that takes a lot of courage.

Courage is also important when dealing with shareholder activists, Browning said. “Activists are not new, but they are becoming more sophisticated.Boards need to listen carefully to shareholder concerns, but they also need to resist being driven solely by short-term stock performance. Our goal is sustainable value creation.”
Important tips: Directors must evaluate strategic decisions with an eye to the company's long-term goals, even when external pressures demand quick results.
4. Adjust governance to the moment
Effective board leadership is not one size fits all. Each board operates differently, and each CEO has unique needs. The key is for directors to adapt their approach to the company's specific circumstances. “No two boards are the same,” Browning says. “What works in one case may not work in another. But back to the point you made: The qualities of an effective, high-performing board are, first and foremost; Most of them are CEOs who are open, candid, candid, and trust the board, and secondly, do everything they can to serve the board's interests.”
Mr. Wildrotter shared his experience as a director of Gaylord Entertainment. “Our CEO was not doing a very good job, so we had to act quickly. The board decided to replace him. My father, who had recently retired, became interim CEO. It's a family-oriented company, and this unconventional choice worked because it suited the company's culture.”
Important tips: Boards must remain flexible while adjusting their strategy and governance style to suit the company's culture, leadership, and market conditions.
Russo summarizes: “When you step into the shoes of a CEO, you understand the pressures and complexities of the role. Boards are most effective when they balance oversight and support, and act as a stabilizing force through both challenges and opportunities. .”