Executive sessions are an important element in board governance; however, they can cause challenges if not used sparingly. Executive sessions allow directors to discuss sensitive matters candidly and privately, which has value in certain situations. Yet, holding these sessions without the general manager or chief operating officer present can have unintended negative consequences that undermine effective governance. While there are valid reasons to exclude the GM/COO from certain discussions, doing so regularly or without a clear purpose can lead to numerous challenges with numerous negative ramifications.
The Erosion of Trust and Transparency
A cornerstone of good governance is trust between the board and the GM/COO. When executive sessions are held without the GM/COO, it can create an atmosphere of mistrust. The GM/COO may feel excluded, uncertain about his or her standing with the board and/or suspicious of the board’s intentions. Over time, this lack of transparency can cause friction between the board and management, causing a breakdown in communication and making it difficult to work collaboratively and achieve the club’s goals.
Lack of Information and Context
The GM/COO typically possesses detailed knowledge of the club’s operations, challenges and opportunities. Excluding the GM/COO from executive sessions means the board may make decisions without having critical context or insights. This lack of informed decision-making can lead to subpar outcomes and additional complications and challenges in the future.
Undermining the GM/COO’s Authority
Regularly excluding the GM/COO from executive sessions can undermine their authority and effectiveness. The board’s actions may inadvertently signal to the rest of the organization that the GM/COO’s input is not valued or necessary. This perception can weaken the GM/COO’s ability to lead with confidence and manage the organization, as board members or staff might second-guess or challenge the GM/COO’s decisions more frequently, perceiving the GM/COO as out of the loop.
Creating a Divide Between Board and Management
The board and management are meant to work in partnership to steer the organization. However, holding executive sessions without the GM/COO can create a divide between these two key leadership entities. The board may become too isolated, making decisions that are disconnected from operational realities only the GM/COO understands. This division can lead to a lack of alignment on priorities, miscommunications and, ultimately, weaken the club’s effectiveness.
Potential for Groupthink
When boards meet without the GM/COO, there is a risk of groupthink, where directors reinforce each other’s views without the critical perspective the GM/COO provides. Without the GM/COO’s knowledge, experience and expertise, the board may overlook alternatives or fail to consider the full implications of its decisions.
Reduced Accountability
Executive sessions are often used to discuss performance evaluations, including that of the GM/COO. While it makes sense to have these conversations without that person in the room, excluding them from broader conversations can significantly lower their accountability. The GM/COO is responsible for carrying out the board’s decisions, so keeping them out of discussions can create confusion about their expectations and responsibilities. This ambiguity makes it harder for the board to hold the GM/COO accountable for results.
Executive sessions make sense in certain situations but should be used sparingly. Holding executive sessions too often or without clarifying intentions can harm a GM/COO’s effectiveness. Boards should first carefully consider when it is appropriate to hold an executive session and then transparently communicate the reasoning for the executive session with the GM/COO. Board members must recognize that including the GM/COO in discussions as much as possible will not only enhance decision-making and foster trust but also lead to more effective governance and a better member experience overall.
THE BOARDROOM MAGAZINE – March/April 2025
Richard M. Kopplin, CMAA Fellow, Kurt D. Kuebler, CCM, CMAA Fellow and Thomas B. Wallace, III, CCM, CCE, ECM and the principals with KOPPLIN KUEBLER and WALLACE.