Board vs. CEO – A review on conflicts and dilemmas in initiating strategic change

Abstract

The paper brings into focus the power struggle existing between the board of directors and chief executives during a time of strategic change. Based on a thematic review of the literature, dilemmas surrounding the ability of boards to direct change are discussed. The discussion is brought-forth amid current calls for boards, in both private and public corporations, to be more involved shaping strategy and taking accountability for the same. It is argued here that board's ability to direct strategic change, works against potential inhibiting CEOs [and senior management teams], characterized with an inherent preference for status quo and external sources of powers beyond the board. No single panacea to board effectiveness is given. However, results from this review indicate that board capital, board process, ethical tone and level of board accountability are among the antecedents observed in powerful boards across the globe.