Does Your Board of Directors have Corporate Cancer?

Committees, councils, and governing boards often begin life full of promise, but end life ignominiously.

In our adventures through Leadership Land, we’ve encountered many specimens of an odd plant called the “committee.” We’ve given it the pseudoscientific name Corpus civilitatis, Latin for “governing body.”

One hardy specimen of Corpus civilitatis growing on the fiery slopes of Executive Mountain.

C. civilitatis is ubiquitous in Leadership Land. You can find it growing in obscure locales such as apartment building cooperatives, holiday party planning committees, and parent-teacher associations. However, there are several subspecies that only grow on the slopes of Executive Mountain, the active volcano that towers over Leadership Land:

• C. civilitatis boardatus - The most common subspecies exclusive to Executive Mountain. Often called “Boards of Directors”, “Boards of Trustees”, or simply “Governing Board.”

• C. civilitatis militaris - Found near the apex of Executive Mountain, on the most dangerous side with heaviest lava flows. Example: the Joint Chiefs of Staff.

• C. civilitatis cabinetus - Flourishes near the apex of Executive Mountain, on the opposite (civilian) side of C. civilitatis militaris

• C. civilitatis legislatus - Coexists with C. civilitatis cabinetus, sometimes symbiotically, sometimes competitively.

Some people in Leadership Land consider C. civilitatis to be a valuable contributor to the ecology of Leadership Land. It restricts the abuse of power by dividing decision-making power among multiple leaders and brings together a multidisciplinary group of experts to govern wisely…in theory, anyway. In practice, many people find C. civilitatis to be an invasive weed that does nothing but impair speedy decision-making.

Let’s investigate the curious life cycle of C. civilitatis. You can learn a lot about the organization’s leadership just by looking at its current stage in the life cycle. The life cycle can guide your decision to join an organization – either as a regular employee, a board member, or an investor/voter. If you’re already an insider, it can inform your decision to leave.

Stage 1: Sapling (5-9 board members)

When C. civilitatis is small, its vitality is highest. A five-member board can act with speed, resoluteness, and secrecy. A quorum is easy to collect, even if one or two members are out sick or vacationing. Board members are usually experts in a certain subject, such as law, engineering, finance, and technology. The fifth member, who has failed to master any of these disciplines, usually becomes the chairperson.

While C. civilitatis can remain in this stage indefinitely, it rarely does. Additional members are added to the board with the excuse of needing additional expertise “to keep the organization at the forefront of the present business climate” or something equally buzzword-y. Thus, experts in human resources, social media marketing, the offshoring of jobs to third-world countries, etc. soon join the board.

Once C. civilitatus reaches a size of 10 board members or more, the next stage in the life cycle begins.

Stage 2: Tree (10-20 board members)

In this stage, C. civilitatis begins collecting board members who, at first glance, appear to be ornamental. They bring no real expertise to the board meetings; their only contribution is a half-baked opinion (often expressed in a long-winded speech).

Why were these additional members added? Rarely, it’s to boost the prestige of the board¹. Sometimes, outsiders invade the board by winning a proxy fight. Other times, the most contentious outsiders clamor for representation on the board so they can participate in the decision-making process. The board acquiesces because they:

1. genuinely welcome diversity of opinion

2. are trying to appease the naysayers

3. are pretending to be inclusive so bad outcomes can be blamed on the newcomers

Whatever the reason, the effectiveness of C. civilitatis begins to dwindle as its branches multiply. Not only is it increasingly difficult to assemble a quorum at the same time and place, it takes longer to reach consensus. Board members express their opinions (i.e. virtue-signaling) in the most verbose way possible, which restricts the number of decisions that come out of each board meeting.

Stage 3: Corporate Cancer (21+ board members)

The election/appointment of ≥21 board members seems to activate a biological trigger in the C. civilitatis cellular structure: the formation of internal factions. An infectious agent drifts in from the Plague Plateau and implants itself in the mind of a low-influence board member: the idea to form political parties and pool votes with other board members. The formation of one political tumor coalition leads to the reflexive formation of opposing tumors coalitions.

In this stage, each faction has a strong incentive to swell their ranks with new board members. When one faction recruits a new member, the others must keep pace to maintain their voting power. The board of directors has been stricken with corporate cancer. Over time, the board will mutate into a bloated mess of warring factions and shadowy agendas. As the affliction grows more enervating, the board loses its ability to exercise effective oversight of the organization.

Two things may happen at this point, depending on the regulatory climate in which C. civilitatis grows:

1. The malignancy grows unabated until the board becomes more ineffectual than a screen door on a submarine.

2. The original “core” group of board members takes matters into their own hands by meeting secretly to decide matters beforehand².

Once stricken with corporate cancer, a specimen of C. civilitatis rarely recovers. It may remain in this sad, bloated state for years or decades until…

Stage 4: Metastasis and Death

Like real plants, governing bodies disperse the seeds from which other ones will rise. C. civilitatis starts “bolting” (in both the horticultural sense and common parlance) when the organization runs into scandals.

Typically the shortest, and most ignoble, life stage of C. civilitatis. It is often triggered by some crisis the board overlooked while the members were too busy infighting, causing the organization to implode. The board members will react to the downfall of the organism in different ways:

• Some will attempt to consolidate power like warlords in the aftermath of a nuclear apocalypse, fighting for whatever scraps remain.

• Others will resign and metastasize to another C. civilitatis organism to “help” these other plants progress through their life cycles. The departing members become disease vectors that transmit the Plague Plateau’s blight across all of Leadership Land.

What This Means For You

Even though we’re satirizing bureaucratic bloat and inefficiencies in governing bodies, it’s a serious problem in Leadership Land. We’ve dealt with small boards that do exactly as they’re designed to do: oversee the organization and serve as a counterbalance to management. We’ve also been horrified by cancerous boards where the members have become more interested in their self-interest than in the welfare of the organization.

As Peter Thiel wrote in Zero to One:

By far the worst you can do is to make your board extra large. When unsavvy observers see a nonprofit organization with dozens of people on its board, they think: “Look how many great people are committed to this organization! It must be extremely well-run.”

Actually, a huge board will exercise no effective oversight at all; it merely provides cover for whatever micro-dictator actually runs the organization. If you want that kind of free rein from your board, blow it up to giant size. If you want an effective board, keep it small.

The takeaway lessons for you:

• Think twice before you donate money to nonprofits with bloated boards.

• If you live in a jurisdiction that enables you to vote for a referendum or initiative on a ballot, pay special attention to government-sanctioned institutions that require bailouts. They often have huge boards with 40+ members.

• If you want to join an organization and to the C-suite atop Executive Mountain, expect poor oversight from large boards. You might have more autonomy, but you’ll also spend a lot of time going through the motions of reporting to an ineffectual board. Conversely, a small board can keep the organization’s management on a tighter leash.

• If you’re a member on a board that has advanced to the latter half of stage 2 or beyond…consider resigning. The life cycle of C. civilitatis can be measured in decades, so you probably have time to prepare an exit strategy. If you’ve read this far, we hope your exit strategy includes a resolution to avoid transmitting the disease to your next board appointment.

1. Some boards add an ornamental member who peaked a long time ago. This fallen star hasn’t done anything noteworthy in a decade or two, but they still have the sparkle of name recognition from the good ol’ days. The board basks in the reflected glory, and the ornamental member receives a sinecure. That’s how C. civilitatis forms symbiotic relationships!

2. This is illegal in some jurisdictions that have freedom of information/open meeting laws.