This article was adapted from a conversation with Paul Gottsegen, President, Halstead Management Company.
The president of our board often takes on most of the work for himself. He’s a go-getter and a jack-of-all-trades, but sometimes he does things without consulting the board. We don’t like to criticize him since he does so much, and we generally approve his decisions after the fact. Is this a good way to operate?
Group discussion is about a group. And boards of co-ops and condos are most definitely about group decision-making. It’s amazing how often boards – and the managers of their buildings – forget that.
It can start with little things, like a president thinking that a hedge around the building needs trimming. Without informing the rest of the board, he orders it trimmed. When no one on the board protests, he starts making other decisions on his own and eventually gets used to acting unilaterally. He is soon e-mailing the manager, giving him instructions without informing the other board members.
This is not a good thing.
It’s not easy for the manager. We discuss how to cope with such situations in our regular management meetings all the time. When a manager tells me that the board president is going ballistic – he’s in the lobby, stopping someone from bringing a dog into the building himself and threatening to throw the offending canine out with his bare hands, I always say, “Do the other board members know what he’s been doing? Are they involved? Have they seen this guy’s anger? Has the rest of the board had input into the decisions the president is hell-bent on implementing?”
The entire board has to be involved in decision-making. A board, after all, is really about a group dynamic. Without the benefit of a discussion among the members, it’s no longer a fully functioning board. You can only make a decision if you have a conversation in which people throw in ideas, give and take on the issues, and have the opportunity to refine or change their opinions through discussion. But if people are left out, they are being disenfranchised. All the people should be participating in the discussion or at least in the e-mails.
I like to cite something Supreme Court Justice Potter Stewart once said: “In the absence of governmental checks and balances, the only effective restraint upon executive policy and power may lie in an informed and a critical public opinion which alone can protect the values of a democratic society.”
In the context of the board, its members are the “public” whose informed opinions act as the “effective restraint” upon any person usurping too much power. You have seven volunteers on a board with varying amounts of knowledge about real estate, and if the president – or any one individual – is doing much of the work, the group often bows to that strong personality. While there are many positive things you can say about a benevolent dictator, he is still a dictator, and there is more room for error and catastrophe if the rest of the board isn’t informed or allowed to weigh in on decisions.
That’s why I tell my agents to be sure it is board policy that all members of the board are copied on all e-mails. Because, a person who might not think twice about doing or saying questionable things when it is just between a manager and him, will think twice about it when the e-mail is going to the entire group. He will be more guarded and proper.
I’ve seen it happen all the time. If you bring it to open discussion, to the “public” – in this case, the full board, someone’s going to say, “Let’s not be so harsh.” Unless you bring it to the full board, however, there’s no chance of changing the direction of one, domineering member.
In the end, that’s the whole point of a board: the group has to make a group decision. Because a decision arrived at through informed discussion is generally going to be a rational decision, not a vindictive or personal one.