Effective governance is the foundation of any successful organisation. Top-performing boards don’t just oversee – they lead with strategy, accountability, and innovation. By examining their practices, organisations can adopt proven methods to enhance their own governance structures.
So, what sets top-performing boards apart? Below we will explore key lessons from top-performing blogs and actionable best practices.
4 key governance best practices from top performing boards:
1. Clarity of purpose and strategic vision
High performing boards operate with a clear mission and long-term vision.
They align every discussion and decision with organisational goals, ensuring strategic priorities are at the forefront.
Best practices:
- Regularly review and refine the organisation’s mission and objectives
- Foster discussions that focus on long-term value rather than short-term fixes
- Ensure board members understand and commit to the strategic direction
Example: Patagonia
Patagonia’s board is renowned for its commitment to environmental responsibility. Their governance decisions are centered around the company’s mission ‘We’re in business to save our home planet’. From donating all excess profits to climate initiatives to implementing responsible supply chain practices, their board consistently prioritises purpose-driven leadership.
Learn more about Patagonia’s ownership structure here.
2. Strong board composition and diversity
A diverse board brings varied perspectives, enhancing decision-making and risk management.
When too many directors come from the same backgrounds, with similar experiences and outlooks the decision-making process can be less open to new ideas and follow the same paths they have always taken.
Top boards balance expertise, industry knowledge and fresh viewpoints to drive innovation. And ultimately result in better outcomes and profits for big companies.
Best practices:
- Aim for a mix of skills, backgrounds and experiences when selecting board members
- Implement diversity policies to promote inclusive leadership
- Conduct regular board evaluations to ensure ongoing effectiveness
Example: Starbucks
Starbucks is widely recognised for its commitment to board diversity and strong governance composition. Starbucks has consistently prioritised gender, racial and professional diversity within its board, ensuring a broad range of perspectives that drive innovation and responsible decision-making. Their board members bring expertise across various industries, including finance, technology and sustainability – aligning with Starbucks’ long-term growth and corporate responsibility goals. This diversity reflects the companies values and strengthens its strategic oversight, ensuring Starbucks remains an industry leader.
In recent months, some US companies have started to scale back or re-evaluate their DEI policies, influenced by shifting political dynamics including Donald Trump’s stance on such initiatives. This has led to concerns about the future of corporate diversity efforts, especially as some boards face legal and political pressure to deprioritise DEI-focused policies. This does so far seem to be predominantly a US trend. Recently it was reported that Deloitte instructed staff working on contracts for the US government to remove pronouns from their emails as well as announcing the end of their DEI programme. However the boss of Deloitte UK informed staff that British operations would remain committed to their diversity goals.
This will be an interesting one to watch. However it does seem that the majority of companies continue to recognise the tangible business benefits of diverse leadership.
3. Proactive Risk Management
Effective governance involves identifying risks before they become crises.
Leading boards take a proactive approach to risk and compliance, ensuring resilience in the face of financial, operational, and reputational threats. High-performing boards that integrate risk management into board discussions are better prepared for uncertainty.
Best practices:
- Stay ahead of regulatory changes and compliance requirements
- Conduct regular risk assessments to identify and mitigate potential threats
- Foster transparency in decision-making to build stakeholder trust
Example: Unilever
Unilever’s board has a strong risk and sustainability governance framework, ensuring that business decisions align with environmental, social, and financial responsibility. Their focus on ESG ensures long-term stability and compliance.
4. Efficient board meetings and decision making
A board’s ability to make timely, informed decisions is critical to governance success.
The best boards ensure their meetings are structured for strategic decisions rather than administrative tasks.
When meetings lack focus, decisions are delayed and engagement suffers.
Best practices:
- Set clear, focused agendas and distribute materials in advance
- Leverage board management software like Stellar to streamline collaboration
- Prioritise strategic discussions over operational details
Example: Amazon
Amazon’s board meetings are known for their data-driven approach, where directors receive detailed memos before meetings to ensure time is spent on decision-making rather than lengthy presentations. Extensive data analysis informs decision-making across all aspects of the business, from product development to inventory management and customer experience. This enhances efficiency and keeps discussions strategic.
Final thoughts on governance best practices
Strong governance is not a one-size-fits-all approach, but the most successful boards share key principles that drive their effectiveness. Clarity of purpose, diversity of thought, proactive risk management, and efficient decision-making are all hallmarks of high-performing boards. By adopting these best practices, organisations can build governance structures that are not only resilient and forward-thinking but also capable of delivering long-term value.
The business landscape is constantly evolving, and governance must evolve with it. Boards that embrace innovation, transparency, and strategic leadership will be best positioned to navigate future challenges and seize new opportunities. Whether through mission-driven decision-making like Patagonia, diverse leadership like Starbucks, proactive risk management like Unilever, or Amazon’s data-driven approach to board meetings, these examples showcase the impact of strong governance in action.
For boards looking to enhance their governance effectiveness, the key takeaway is this: great governance doesn’t just happen – it is built through intentional strategies, continuous learning, and the right tools. Stellar’s secure board management platform helps boards streamline meeting preparation, improve collaboration, and enhance governance effectiveness, all in one place. Get started with a free trial today.