Conflict may be regarded as any form of friction, disagreement, or discord arising within a group when the views or actions of one or more members of the group are either resisted by or unacceptable to one or more members of the group. Where individuals with strong convictions associate, conflict may arise from a divergence in views, opinions, perceptions and personal interest. The Business Dictionary defines conflict resolution “as intervention aimed at alleviating or eliminating discord through conciliation”.
Directors would typically bring to the Board varied experience and divergent views. It is therefore important for the Board to engage and manage these different views to ensure that they do not or potentially impact negatively on Board deliberations and decisions. An objective, transparent and open decision making process borne with an inbuilt conflict resolution mechanism would improve the effectiveness of the Board and enable it provide the appropriate oversight to the ultimate benefit of the organization. On the converse, where conflict is poorly managed, it can result in severe damage to the fabric of the Board and in the long run the organization itself.
Many Directors are of the view that the absence of conflict or the avoidance of conflict at all cost is a good indication that the Board is a “good” or cohesive one. They therefore do not consider the imperative of a conflict resolution mechanism. The negative impact that the existence of unresolved conflict could have on a Board however warrants that the Board should pay sufficient attention to putting in place a conflict resolution mechanism.
Using a systemic approach to resolve routine and occasional disagreements that arise on the Board will ensure that disputes are resolved more effectively and will also enhance the Board’s collaborative problem-solving and decision making capabilities. Most of the time, Directors are able to find amicable resolution to seemingly knotty issues by having frank and open conversations. However, they can be far more effective if they establish a broad range of internal and external resources to assist them in uncovering and resolving conflict.
Global best practice in conflict resolution and corporate governance recommend that Directors and Boards should take the lead in addressing their own problems and disagreements as it pertains to or arising from their oversight responsibilities, using the most constructive approaches possible. The Chairman and indeed all the Directors require the appropriate skills and a clear understanding as to when and how to use these skills. These include individual initiative, negotiation, informal mediation and decision making skills. A high level of emotional intelligence is also very critical in dealing with conflict at the Board level.
A systematic approach to addressing the issue of conflict on the Board will be incomplete without a Conflict Resolution Policy in place. A Conflict Resolution Policy defines in clear terms and prescribes a mechanism for dealing with conflict on the Board. The Policy should be considered and approved by the entire Board as this helps to ensure that the Policy gets the buy-in of all the Directors and that the Directors are well apprised of the contents of the Policy.
A more recent concept on dealing with conflict is that of the “Board Ombudsman” who is usually external to the Board and the organization as a whole. The role of an Ombudsman is that of a highly competent, independent and confidential person who can help Directors and the Board solve problems through effective, diplomatic but informal methods. Usually, the power of the Board Ombudsman stems from the individual’s credibility as an independent and neutral resource as well as an objective peer. While the role of the Board Ombudsman does not currently exist in Nigeria, there are individuals who have taken on the role of “external advisers” or confidential resource persons informally such that they help Boards resolve and manage conflict, particularly with respect to highly sensitive or potentially explosive matters. It is suggested that Boards should incorporate the role of a Board Ombudsman in the Conflict Resolution Policy.
Due to the nature and dynamics of Boards all over the world, Boardroom conflict is inevitable. As conflict can be constructive if properly managed and help create or strengthen Board cohesiveness, Boards are encouraged to take deliberate and conscious steps to manage and resolve conflict effectively. At the helm of the entire process is the Board Chairman who should ideally be a visionary leader and take the lead role in the conflict management process. In the absence of an “Ombudsman” formal or informal, the Board Chairman is critical and pivotal to the entire process of managing or resolving conflict on the Board. In the words of Charan, Carey and Useem in their book “Boards that Lead” “the board leader’s job is to head off those terrible moments if possible, or at least not let them paralyze the organization once they emerge. After all, board leader was chosen by their fellow directors precisely because they have demonstrated the perceptiveness and persuasiveness required for aligning others at the top when it really matters”.