#129 What Makes Boards Truly Effective and How Do We Assess That Effectiveness?

Welcome to the Proteus Leader Show, a podcast for forward-looking leaders driving transformation in their organizations, within their teams, or for themselves. Your host today is a senior leader at Proteus International, a firm that partners with companies around the world to make true transformation easier through change consulting, leadership development, and executive coaching. If you're looking for fresh perspectives and practical insights you can take back to work today, you're in the right place. Enjoy the episode.

What if the difference between an average board and an exceptional one comes down to something we can actually define and measure? Too often, boards are judged by reputation, experience, or instinct alone, when the real question is whether they are truly helping the organization think better, decide better, and create greater value. And when we start to assess that more intentionally, we open the door to a very different kind of board performance. Welcome to the Proteus Leader Show. Today we're diving into that exact topic that matters enormously to CEOs, founders, chairs, and board members alike. What makes boards truly effective And how do we assess that effectiveness in a way that is practical, useful, and grounded in real impact? I'm delighted to welcome Bob Arsenyaga to the show. Bob is the founder of Advisory Board Architects and co-founder of Boardology, a platform focused on helping organizations optimize board performance. His work centers on designing fiduciary and advisory boards that are aligned to a company's strategic imperatives. and on measuring board performance through what he calls the 3 E's: engagement, efficiency, and effectiveness. Bob, it's wonderful to have you with us.

Marie, it's wonderful to be here. Thank you for the invite, and I'm looking forward to our conversation today.

Same here. Now, let's dive right in.

Sure.

When you think about a truly effective board, What are the qualities that distinguish it from a board that is simply doing the basics?

There's nothing wrong with doing the basics if that's what the ownership and CEO expect from their board. So expectations from ownership are really critically important. But assuming that they want their board to actually be more impactful to the organization rather than just oversight, There's actually 2 other levels that boards can achieve beyond just the basic oversight level. One would be the ability for them to help with insightful ideas, right? So rather than just oversight, we're going to go to insights and leverage the board members' expertise for different insights on how the organization can achieve its goals faster. Okay.

Okay.

How to maybe identify risks a little bit better. Those are all very, very helpful. The ultimate level, which is what we strive for with our clients, is what we call the foresight level. And that's where boards are truly becoming a partner with management in accelerating shareholder value faster than management was going to do otherwise on their own. So it becomes a really unique collaborative partnership. Very engaging, very impactful, but it requires some discipline and a definite change in the traditional board process. The traditional board process, unfortunately, is designed primarily for the oversight level.

Hmm.

If we're lucky, we might get every once in a while some insights from the board that are Okay. But if you look at most studies, not just ours, but studies through PwC, EY, Conference Board, you see that many CEOs do not feel their boards are participating at that insight level, let alone getting to the foresight level.

Mm-hmm.

And in some cases, it's not an issue around you have the wrong board members or the board members aren't trying. to provide that value. It's really the process itself.

Yeah.

So 2 things about the process that really make a board truly impactful. Number one, the process should not be focused on just regurgitating historical past performance. Here's what we did last quarter. Here's all the metrics, as if the CEO and management didn't already know that. Not really.

It's not about looking backwards.

Exactly. And I understand that everybody says that, and everybody says their boards, oh, we don't do that. Come on, let's be honest, right? Because we talk to hundreds of CEOs and board members every single month. Let's be honest, when they're not at the cocktail hour and they're actually sitting down with us, they are telling us— it's almost like confessional, okay? We start to really understand that Actually, the board's adding very, very little value, at least to the perception of management, which means essentially they're not. And I'm not saying they're not doing what they're supposed to be doing. I'm saying they're not doing it to an exceptional level that would benefit shareholders, truly benefit shareholders.

As you're talking about the process, often the executive team would speak for the majority of the board meeting. So there's also little time for board members to contribute, to bring insight, or even less foresight.

Yeah, and that's something that in our system we've drastically changed. The system does not allow for the management team and the CEO to present information. By the way, that's what the board documents are for. The board documents are the historical backdrop.

Right?

So if we're doing the board documents properly, why does management need to regurgitate what we've already sent? I assume the board members can read. And by the way, even if they can't read, nowadays you don't even have to read anymore. You can have your computer read it to you.

So get a summary.

Or get a summary or whatever. Right. And so that's not the difficult part. The difficult part is why are we regurgitating what we've already sent? Because sometimes the data itself that we're sending, it's good data, but it has no context. It's the difference between in a boardroom who's educating whom. The more that management educates the board on historical data, the less value transfer there is. So the more that we can engage the board leaders In talking about things that haven't happened yet, the more valuable for the shareholders, the more valuable for management, and the more engaging for the board leaders themselves. Most board leaders don't like to do governance. They like the strategic aspects of growing a business.

They've often been in the driving seat before becoming board members, right?

Absolutely. That's their mindset anyway, is growth.

Yes.

It's not oversight, right?

Let's dream for a moment. Let's forget about basic oversight and think about a board meeting where you would have insights and foresight.

Sure.

Could you maybe describe to me how would this go? Because I know you're building those boards for your clients.

Yeah. We assess and get feedback from every board leader and every management team member after every single board meeting that we do globally. A couple of common threads that we see. Number 1, when we start a board meeting, we don't start with CEO comes in, presents the data, or management, they come in, present the data, and then we wait for a reaction from the board members. No, no, no. The way we do it is, since we sent you the data and you've read it and you understand it, and we have a unique way of how we do that, you know what we're trying to solve for today. for this meeting, for this topic, we're trying to solve for this. We're not reporting to you. We're not updating you. We are trying to solve something very strategic to our business.

Mm-hmm.

Now, because you read everything, guess what? Where we start with is, okay, board members, you're on. Time to start adding value. We don't need to hear from the CEO. You already have the CEO's information. What clarifying questions do you have? And What are your thoughts? What are your insights? What are your foresights to help us?

Yeah.

Let's go. So that means that in the board papers, there's also an announcement around those are the problems we need to solve. Already an agenda.

Exactly.

So then board members have time to think, read, review, and they can obviously ask clarifying questions.

Exactly.

More importantly, then make suggestions or challenge the proposal.

Or challenge. Or collaborate, yeah, right? Because look, some of these things that we're dealing with with our clients—they're so innovative and revolutionary and disruptive. No one has an answer; it hasn't been done before. So what that requires is massive collaboration. The way I would like to describe it, and it's a good analogy: recently, the world. was lucky enough to have astronauts go around the moon.

Them is 2.

Which was amazing, right? Here's what's really interesting about it. That wasn't a 1-year or 2-year project. That was many, many years of work.

Yes.

From many different companies, from many different government agencies. I think I heard an estimate on the news that as many as 600,000 people were involved in making that happen.

Yeah.

And it went flawlessly, right? But let's not forget that there was one vision, but there was multiple ways to achieve it. And I'm sure of the 600,000 people, right, everybody might have had a different opinion about things. And yet, somehow or another, they were all able to come together And rally around one vision. We got to get them to the moon, around the moon, and back safely.

Yes.

Right? That's the power of human collaboration. And in my world, that's what boards are designed for. Because if you really look at anything in human history that has been transformational, i.e., like going around the moon, it's not one person's idea. It's usually a combination, a collaboration.

Yes.

Of very smart people focused on one objective.

And I think it's a wonderful analogy, Bob, because beyond going around the moon, they were also thinking about what's next, right? So also they were thinking longer term, and there was really this invitation to get the right partners, which was very different from the previous mission. Yeah. So I think it's really resonating analogy for me.

And I think the analogy is good because just like you, when you engage your board to collaborate at this level to help you achieve an outcome or objective achievement, whatever it is, that's step 1. So once we've gone from here to here, that's going to be our new baseline. Now the next level is here. We don't just stop, right? We continue to go.

So I imagine how this goes, right? Board members would be ready to contribute, asking a few questions. And I can imagine that sometimes it could become chaotic, right? Because you have big personalities around the room or people that are more quiet. So being a facilitator myself and produce is What we do, I feel that there is a need to have some ground rules, some facilitation excellence in that. So how does it play out in practice?

It's a really good insight that you have there because you're exactly right. Facilitation is critical. And unfortunately, a lot of people feel like you're an amazing facilitator. That I know, right? A lot of people think that's something that you either have a skill set in that naturally or you don't. Actually, that's a skill set that can be trained.

Yes.

Unfortunately, how many programs do you know of that train board chairs on how to actually facilitate human collaboration?

We believe so much in producing facilitation excellence. And this is what we do. We think about it as this master skill.

Yeah.

That goes above everything else. Not just listening, but restating and asking powerful questions, making sure everybody's heard.

Yes.

Such an important skill. I mean, for any leader, but I think in the boardroom even more nowadays.

Critically important. Critically important. But beyond that, there's training for the chair, but there's also training for the board members. To your point, what are the rules?

Yes.

Well, that requires consistent training. That's something that most boards don't do. When I go into the boardroom, boardroom, I don't know what kind of board culture I'm walking into unless someone's described it to me and someone trains me on how to properly interact to meet the expectations and the cultural and performance expectations that the organization has at the board level.

Now, I think each board member needs also to take responsibility for their own kind of development, right? So Even if there's not a recipe given out to you, I think it's our responsibility to talk to every board member and to ask questions around that. How does it work?

Yeah, think of it this way. Everybody focuses on due diligence before they get on the board. What about your due diligence once you're on it? Yeah. The way I describe it to every single board leader that goes through our training before they ever go into one of our boardrooms has to go through training. I don't care if they've been on 100 boards, they will go through the same training as everybody else because you haven't been on one of ours and they're different. We have different sets of expectations. We have a different cultural profile. Everything about our boards are different. So what we expect is you're going to go through training, and what we're training you to do is how to add impact meeting one, our one. You're creating value. If you're not, you're not coming back. As you know, board meetings generally, not always, but generally meet quarterly. So I hear, well, it takes us a while to get up to speed. What's a while? I don't know, 4 or 5 meetings. Okay, so you expect me to wait a year to realize your value at the board level? I'm sorry, it's too long. That would be like A board hiring a CEO and the CEO going, hey, you're going to have to give me a year or 2 to really start performing because I got to learn how the company works. That would never be acceptable to a board, right? Would not be acceptable to shareholders. Why is it acceptable for board members to take a year or 2 to get up to speed? That's not acceptable. Not in a high-performance board anyway. The final piece is measurement. So you have facilitation, you have training, but then you have the measurement. Let's consistently measure how the performance is going.

Yes.

And let's make consistent improvements to the process and provide feedback to the board leaders consistently on how they're performing so that they can maximize their skills every single meeting.

That's reassuring, Bob, because I think, yeah, the expectation can be to add value from the first minute. However, we all can learn and get better over time as you understand the context. And so again, I think board members can be proactive. I did a 360 review across my boards and I got some very valuable feedback because I want to be more effective, right? But when I guess a board member doesn't take the initiative, How do you make that a process so you hear quality feedback, actionable feedback that you can implement at the next board call?

Yeah, it's not surprising because you've gone through our board leadership skills assessment. So I know how you think already because of that. So that's not surprising that you told me you take that initiative. You're a proactive board leader. We've already identified that. By the way, that is something for your listeners, especially the CEOs and stuff. You can predict that before they ever join the board. So if you're looking for highly proactive people who take initiative and don't just wait to be asked but offer help instantly, that's a skill set you can identify before.

That's excellent. That should be part of the recruitment process.

I mean, that should be part of the company's due diligence process, right? As you said, if you want to create that type of board, you want to create that kind of value, that's what you need to be looking for rather than the person. I'm not saying that they're doing anything wrong. But the person that's just gonna sit there and be like, look, I'm gonna listen to all of your information. I'm gonna ask good questions. And when you need something, just ask me. I'll be happy to help. Well, wait a minute. I'm a CEO. I'm heads down, right? I'm not gonna remember.

Yeah.

To call my board members and, oh yeah, I should talk to so-and-so about that. But if You're a board leader, and like yourself, and you're naturally inclined to think that way of when I help the CEO with this, the next 2 or 3 steps they're gonna need is probably here. I'm just gonna go ahead and offer that now.

Yes. Yes.

Okay. CEOs love that when their board members are offering help, not when they're looking at the CEO saying, What help do you need? Really? If I have to tell you that, well, I have my own board, we drink our own Kool-Aid.

Also, they might not know that this help is available because they don't know the depth of your network expertise, you know. But I'm very interested by this assessment as part of the recruitment you're talking about, because I think we talk a lot about skills matrix, experience, right? So check the box as this board member, this degree, this experience, this skill set. But I think you're talking more about personality traits, attitude. So how do you assess that?

We're really talking about leadership skills. Okay. And by the way, board leadership skills are very different than executive leadership skills. Yes. Because don't forget, when you're an executive, and this is one of the hardest things to get executives when they go on their first board, This is often the struggle. Maybe you struggled with this yourself even. And that is, I'm a successful executive because I've been a great operator.

Mm-hmm.

Okay? I've been a great manager and I'm really good at that. Now, I want to go on the board level because I've been so successful. But guess what? I haven't made that switch in my head between operator And strategist.

Yeah, it's a big shift. And I would say a lot of board members are still CEOs. Yes, like I am. So I have to do this shift almost every couple of days, and it's a different attitude.

Yeah. And by the way, you're not tactically operating this business. That's the CEO's job. That's his or her team's job. That's not your job, right? But as much as you can help them excel, the more value you're creating for the shareholders rather than just, oh, you said you were going to do this. Now I'm going to hold you to that. I'm going to make sure you did those things in the time that you said. That's oversight. That's not foresight. That's not insight. That's oversight. And so, the proactivity gets you to that next level.

Hi everyone, it's Marie-Helene, host of the Proteus Leader Show and CEO of Proteus International. I'm delighted to share that the Proteus Leader Show has been featured in the 2026 edition of the Top 40 Change Management Podcasts, and we're honored to be ranked number 20. For those who may be new to us, Proteus International is an American-based company providing transformation, coaching, and leadership development services globally. Through this podcast, our goal is to help leaders navigate change, lead with clarity, and create true transformation in their organizations and their lives. You can find the link to the top 40 list in the show notes. And while you're there, please make sure to follow the podcast So you'll be notified when new episodes are released. You can also help more people discover the Project Leaders Show by leaving us a review and sharing the episodes you've enjoyed with your colleagues. Thank you for listening. Thank you for your support. And here's to creating the leadership you truly want. I'm curious, as we talked about that measure element, right? You could have a process to give feedback to the board members, but I guess also you could evaluate your board effectiveness. And I believe this is also What you do and what are the effective ways to evaluate board effectiveness? Because we all have filled those questionnaires and then you get a report and nothing happens. So what are better ways to evaluate boards?

Yeah, look, first and foremost, I think where boards and organizations fail in the evaluation protocol is why are you doing a board evaluation at all?

Okay.

Because I think a lot of the board evaluations that we see, especially for listed companies, both in Europe and here in the US, it's a check-the-box exercise. Let's be honest. There's really no value creation. There's no dissemination in such a way that it's given to me and customized to me as the board leader on the board who's trying to become better at this, who's trying to be That real go-to, what we call first-call board leader for any CEO.

Yes.

That's what a lot of the people we deal with on our boards, that's what they want. They want to be that person, right? We should be able to help them be that person by giving them feedback. Even when they're killing it on the board, they could be better still. And it's up to us to find those opportunities for them. And explain that to them. Look, maybe go at it this way, or you prepare in this way, or you follow up in this way. And we've seen it because we see some of the best board leaders in the world on our boards. We see what they do. So I think the important part is, why are we evaluating our board? Is it just because we have to? Because if we're a New York Stock Exchange listed company, there's some level of expectation. Or Is it because as an owner of the business, I want to know how much value is being created for my board and how the board could potentially create more value for the organization in the future?

And what's my ROI? Because having a board is an investment.

It's a very expensive investment. When I talk to chairs and CEOs quite often and I ask them, How's your board perform? I don't get an ROI number. I usually get a, it's pretty good. And then I always say, so can you quantify pretty good for me in dollars and cents? Let's say I'm a shareholder and I ask you that question. Are you going to tell me pretty good or are you going to give me an ROI? Right. They can't really give me an ROI because we don't really track it that way. Right. And yet. If you ask any board, how's the CEO performing? Part of their mandate, if they're doing proper oversight, is to put together a whole list of metrics that the CEO has to meet to prove that CEO is actually performing at a high level. Why is it any different for the board? It shouldn't be.

You make me think about a question. If The money that is spent on a board, you give that to the CEO, where would you invest that money and what would you do with that money?

Boy, think about the shareholder value that would generate.

That might be a different answer.

Look, the way I view it for my own board. Now, this is me personally. I'm the owner of my company. So it's a little bit different. I don't report to a board. I have a board that reports to me because I own the company. So, in my case, we had a board meeting last Friday. When I woke up Friday morning, my expectation was 4x. I don't get up in the morning and leave my dogs and leave my house unless there's a 4x return in the cards at minimum. So, that board meeting last week, I wanted a 4x return on the cost of the board meeting. The cost fully burdened, by the way, not just the cost of flying them in, not just the cost of paying the stipends and the upside. And the D&O. And not just the cost of the dinner, which we always have board dinner, but also the fully burdened cost of my team's time, my time prepping for them.

Preparing board papers. Yeah, right.

Okay. While we're doing that, guess what we're not doing? We're not making the shareholder, me, money. So that needs to be equated into the cost as well.

So I guess you really have those metrics in place from the beginning with the board chair, the CEO. What do you want to have from the board? And then you kind of assess them, but in a quantified way, not just a quality—

In a quantifiable, totally objective way. Look, I'm not saying that they're not good people, that they're not smart people. That's wonderful. But good and smart, I would expect that of every board member. But actually what my expectation is, how are you utilizing and how can we leverage how good you are, how smart you are? To grow our business.

Yes. Beyond the questionnaire, and that could be part of the evaluation, you also do interviews and you also do observations. Could we spend just a bit of time on that? Because I think the observation to me is something that I haven't seen a lot.

Yeah, when we implement our platform, it's a very different platform, how we prepare for board meetings, how we facilitate them, how we evaluate them, and everything that happens in between the meetings. That's all designed by us in our system for our clients. So it does start with prep. And we work with our clients in such a way to truly understand what are the key levers of the business that drive the most enterprise value. And those are the things that we want to dig in deep with the board members. What— why are we talking about anything else? If we have one or two key objectives, if we don't achieve these objectives, Mm-hmm. A lot of the other objectives that we have planned probably don't matter anymore because we're not going to hit our numbers. We're not going to hit our budgets. We're not going to perform at the level that the shareholders expect. So why would we talk about anything else with our board? Let's just focus on those things, or at least spend the bulk of our time, the supermajority of our time, focused on those things. So that's what we help our clients prep with. Once we get in the meeting, We facilitate it to those objectives.

Yep.

So when we have a meeting, it's about solving a strategic imperative. That's what it's about. And the imperatives are really, really big, as you can imagine. That's not going to be meeting by meeting, we're going to solve one imperative after another. It doesn't work that way. This thing might be so big, it may take 3 or 4 meetings to work its way through. And so we're going to be spending a lot of time on that topic, at least for the next few meetings. That's our facilitation strategy. Then once it's done, then we provide a post-meeting survey after every single meeting. We collect that data, we analyze it, and then we provide recommendations and feedback on how the whole board in general and the board process can be enhanced in small ways. Between now and the next meeting. So we increase the impact every single time, but also the ability for us to identify ways that each individual board member can increase their impact meeting by meeting.

Mm-hmm.

And the nice part about it is it's not feedback in, look, this meeting you really sucked. That's not what we're talking about. That's a different conversation. We have board members that aren't performing. We're having a different conversation than you need to perform better. These are for the top-performing board leaders in our system globally. They get feedback after every single meeting, and they love it. They want that feedback.

Feedback is a gift. I always— I really believe in that.

I'm a CEO. I want people that are striving to be better at whatever it is they do. They want to be excellent. They don't just get to a certain level and go, okay, I achieved everything I wanted to achieve. I'm done. That's not how it works, right?

Yeah.

So, that's what we're looking for. We're not looking for good boards. We're looking for excellence because the companies I know, they want to be excellent at whatever it is they do. Good means they're going to be out of business.

Yeah.

Excellence means that you're a leader in your industry. Well, how can you have an excellent company and an excellent team and not have an excellent board?

I really believe that boards can be differentiators. They can in today's world, right?

We call them force multipliers. Force multipliers. So you take an amazing management team on top of an amazing organization and you supercharge it with a board focused on creating that enterprise value for shareholders. Man, that's nirvana. And we get rid of all this other stuff about talking about things that are important but not gonna be a direct contributor to the enterprise value.

Feels like Artemis 3 in the making. Sure. But we love leaving our listeners with practical tips. And I think the entire conversation was filled with it, but could you summarize maybe the top 3 tips for our listeners if they're on boards and really want to improve their board effectiveness or maybe board chairs, what would you tell them?

So for board leaders, I would say this, number one, training, training, training. To be really excellent, this requires a lot of repetition. The way that most of us have been told how to add value to a board is wrong. This nose in, fingers out. Oh my God. If I hear one more person say that, it's almost like a binary choice. I either have to be fully tactically in, which you can't be if you're a board leader. Right? Or I'm going to be so reactive and wait for the CEO to reach out to me. Are you kidding? Are those the 2 only binary choices? No, that's not true. That's a fallacy. There's a middle ground here, which is I don't have to be tactical. I don't have to be operational, but I can still be highly proactive.

Yeah.

I can take this job so seriously That the point when I entered the company at the board level, the company was worth X. My goal when I leave, the company should be X plus. Okay. Or else you didn't do your job. You did not. Maybe you checked all the boxes, but you didn't contribute to that growth at all.

Yeah, there was a real Change of mindset.

It is changing the mindset of how am I going to react to how can I help?

Yes. I think coming from a place of collaboration, being helpful and sharing your thoughts and influencing ultimately.

That's what we train people on. Ultimately, you'll never tell a CEO or management team what to do. You can only influence their thinking. It's awesome that you use that word because that's ultimately what you do when you're a board leader, when you're a world-class board leader. I've seen the best in the world do this, and they are master influencers.

Yes.

And it goes way beyond asking some good questions, right? I expect good questions. What I really want though as a CEO is great ideas.

Yeah, because I would describe it as sharing thoughts and ideas that then could click for the CEO. And he would then come to his own conclusion. And I've seen that happen and everybody feels good around the table because there's a lot of respect. And probably what the CEO comes up with is better than what you have thought because you don't have all the context, but you might have played a part in kind of getting that idea coming to you.

That's exactly right. And Here's the beauty when you put all this together, as we've been talking about, great prep, awesome facilitation, highly proactive Board leaders. When we left our Board meeting on Friday, I walked across the street from our office with our Board leaders. I asked the Board leader who got that survey that afternoon, but I was asking him, what'd you think of the Board meeting? He goes, I gotta be honest, we started the meeting. And we started talking, and the next thing you know, I looked up and we're done. 4 hours went by like that. It went quick.

Yeah.

And he goes, and mentally I'm exhausted. And I'm like, that's because I didn't talk. I let you talk. Yeah, I just asked— if anything, I was asking them questions. They weren't asking me questions. I was asking them questions because of their ideas. I was very intrigued by some of their ideas that I wanted to dig deep on how we could implement some of those ideas right now.

Yeah, the secret of engagement.

That's it.

Not to talk.

So as a CEO, the more I can listen to my board leaders, the more opportunity they have to create that value. And the more, as the shareholders, we'll receive that value in the future.

Bob, thank you so much. I feel so privileged that you came to the podcast because for me, it's thoughtful and practical at the same time. And what I'm taking away is that effective boards are not just about governance structures, impressive resumes, basic oversight. They are about intentional design, the right mix of capabilities, strong engagement, an excellent process, and the willingness to assess honestly whether the board is truly helping the organization move forward. And that matters, you know, because as we said, it could be a real differentiator in today's world.

Exactly right. I can't wait to get you in one of our programs, Marie. I really can't. You're gonna kill it for us. I know it.

I hope this conversation has inspired listeners and gave a clear picture of what board effectiveness really looks like and some useful ideas on how to evaluate it. So do not hesitate to follow Bob on LinkedIn or Substack. I can assure you it's worth it. And if today's discussion also sparks your interest in joining a board yourself, I encourage you to listen to our episode number 109 with Jackie O'Dee, where we explore how to get your first board role. You can learn more about Proteus and how we support leaders and organizations at proteus-international.com. Thank you for tuning in. And until next time, here's to creating the board leadership you truly want. Thank you, Bob.

Thank you. Thanks for listening to the Proteus Leader Show. We hope you're leaving with ideas you can put to use on your team, in your organization, or in your own career. To learn more about how we support true transformation through change consulting, leadership development, and executive coaching, visit us at proteus-international.com. Until next time.