It is a board’s inalienable role to consider and assure the core Future Fiduciary question, “Are we optimally invested in our own future?”.
As the ultimate trustees of an organization’s existence, it is up to the board to consider if the organization is behaving effectively to deliver to the purpose of its existence. Because surely the alternative is that the organization is ineffective, not optimally effective, or simply doesn’t know if it is effective or not.
And to engage this question, each board needs to consider why the organization exists.
Is it purely profit? That’s an OK purpose if it’s a deliberate choice. And if it’s purely profit, you still need to decide if that is to be maximized to today (with no concern for the future) – or is it balanced over time? And what timeframe, and what balance? Your shareholders all have different needs. You can’t simply ask them. You have to determine it for yourselves… and then measure whether you are delivering that… or something else.
And, if your organization has interests beyond profit what are they? How will you measure them? Is it ensuring you can be successful sustained over the longer term? What term? Retaining your best employees? Keeping your communities happy and healthy? Staying competitive, and making sure your customers are here to buy from you in the long term. Maybe zero tolerance for illegal behavior. Maybe ethics. Maybe environment. Maybe something else. It’s your choice.
No one can tell you who to be.
But once you’ve chosen, are you working optimally to that outcome? Or are you doing something else?
The research shows that if you have the practices in place to determine if you are working optimally to your chosen objectives – you perform better. In other words, recognizing your Future Fiduciary obligations, and putting the Governance of Value Creation practices in place to deliver on them is core to building out high performance organizations in a complex world.
The concept of Future Fiduciary is most simply stated as this:
Governance of Value Creation enables us to assure the core Future Fiduciary question “Are we optimally invested in our own future?”
and to address the subsidiary questions:
If we did everything we are currently working on, who would we be?
Is that who we want to be?
What do we need to do differently now to create a different future outcome?
and finally
Do we have the value creation capacity to achieve our aspirations?
The journey to this better practice starts with a recognition that a better form of governance is needed to succeed in a revolutionary different era of expectation on corporate behaviors and performance. It continues with the board considering a nuanced and mature definition of the purpose of their organization in this context, including clear definitions of its understanding of value and values.
Ultimately every organization needs to operate a fit-for-purpose governance framework that enables each director to assure him or herself that their organization is optimally invested in its own future.
Only then can an organization and its leaders stand up as the mature corporate citizens they aspire to be, knowing they are contributing their full potential value to their own future, and the future of humanity.