Preserving a positive board/CEO relationship has long been a primary task of corporate leadership. Yet a variety of new demands are combining to place significant pressure on both CEOs and boards, in a way that threatens to “fuel misalignment and missed opportunities for collaboration”.

Those pressures have surfaced recently in high-profile leadership controversies involving technology, beverage, and merchandising companies. They’ve been exposed in a prominent governance survey in which a vast majority of responding CEOs said they wanted at least two or more of their directors to be replaced. And it’s why new guidance from the National Association of Corporate Directors, on strengthening the board/CEO relationship, is being viewed with such promise.

NACD is a prominent member organization for corporate directors. Each year it commissions a diverse group of business leaders to examine a governance issue of critical importance and to deliver a report with practical and actionable recommendations.

This year’s report, “Building a High-Trust Board-CEO Relationship”, cites three interrelated trends as pressuring the board/CEO relationship: First is the greater scrutiny on CEO performance as they become “more visible, identifiable and accountable to multiple stakeholders”. Second is shrinking CEO and C-Suite tenures, as executives are forced to “make transformative decisions with shorter time horizons, under greater scrutiny and with few precedents.” Third is greater expectations for board performance, with CEOs calling on their boards to serve as strategic advisors “for nuanced expertise, real world experience and access to valuable networks”.

From this pressure can come a dysfunction that prompts an increasing number of directors who view the board’s value more highly than do CEOs. This, while fewer numbers of CEOs believe it the board “has the CEO’s back”, in comparison to directors who believe that they do. The concern is that, too often, the resolution of these and other key relationship issues evolves by default, rather than by design. The NACD Report promotes a deeper, shared commitment to cultivate the relationship with “purpose, discipline and intentionality” ‒ in which shared trust “is the enabler”.

Much of the Report is thus devoted to specific recommendations designed to provide practical, consistent behaviors for the board as a whole, as well as for individual directors and the CEO. They include:

Building the Trust Foundation: This is the activity of boards and CEOs in purposely defining roles, responsibilities, expectations and structure, and can be pursued through three specific steps:

Each of these underscore how board leaders play a pivotal role in building the foundation of the trust relationship with the CEO.

Operationalize Trust: This is the process by which routine governance efforts and ongoing interactions intentionally reinforce the established trust foundation. This process involves four specific steps:

Each of these steps underscore how “[T]he work of the CEO-Board relationship primarily happens outside the boardroom.”

Leverage Trust for Strategic Impact: This relates to how a strong foundation of trust is enhanced through consistent behaviors and board practices. This enhancement is grounded in two key practices:

These practices serve to unlock the value boards can provide in support of the CEO, when CEOs see value in accessing the board’s strategic vision; and when the board is composed not as a collection of single-domain experts, but rather as directors with integrative mindsets.

NACD’s recommendations are supported by a lengthy “toolbook” which is intended to allow directors and executives to address with practicality the main themes of the Report, e.g., clarifying the boundaries of board duties, and ensuring alignment on when and how authority is delegated to the executive team.

The essence of the NACD Report is that strong trust between the board and the CEO is essential to how corporate leadership can navigate current operating and cultural complexities. The key take-away for those leaders is to commit to conversations on how to enhance the strength and quality of the board/CEO relationship, and to adopt meaningful measures to nurture and sustain it.