What is the difference between governance and leadership? How is the role of the CEO different from that of the Board?
The difference between governance and leadership is that governance develops generative core questions and issues that “shape the road” for leadership by creating a structural guideline that set broad policies for the organization to carry out. For this reason, leadership (the CEO/Executive Director) is responsible to carry out day-to-day decision making responsibilities while running the organization as effectively as possible.
The difference between the role of the CEO as opposed to that of the Board is that CEOs have materialistic loss when there is improper execution of their authority, while the Board has little materialistic loss since they are self governing bodies that are elected. The Board has the power to fire and hire a leader that they believe would effectively carry out the operations necessary in order to successfully implement the mission of the organization. According to the reading, “a past CEO’s presence is helpful and sometimes it’s not…a retired CEO can play an invaluable internal role as a mentor, sounding board, and link to critical outside parties”. This means that they can still have some indirect influence on an organization, while Board members are asked to step down if there is a conflict of interest and are not involved in any of the processes within the team of members.
In addition to the points highlighted, it is argued that boards with too many members have less accountability and murky policies. If a board is dominated by many “insiders”, there is a risk to detriment the organization’s outcomes in order to fulfill it’s mission. An argument against this is that board members may be resourceful and informed of the issues the organization may try to tackle. In this case, they can influence the CEO’s decision making process through assertive debate. As a result, the Board has the privilege to evaluate the executive by analyzing their impact on the organization’s outcomes.