Staff Writer 
By Memory Nguwi
MOST boards have a charter. Very few actually use it in any meaningful way.
In many organisations, the only time a director reads the charter is during induction, assuming induction is properly conducted. After that initial exposure, the document fades into the background. It is rarely opened or referenced. Over time, it becomes a document used for compliance rather than a living governance tool.
In some institutions, the situation is even more concerning. There are boards that operate without a charter altogether. Others have one, but several directors have never seen it. In such cases, governance depends heavily on informal understandings, dominant personalities, and unwritten rules. That may appear manageable when relationships are harmonious. It quickly becomes unsustainable when complex decisions must be made or when disagreement surfaces. Without a shared written framework, each director interprets authority differently. That inconsistency weakens oversight and exposes the organisation to avoidable risk.
The deeper problem is not whether the charter exists. It is whether it is used. In many meetings, decisions are made without reference to the charter’s provisions on authority and responsibility. Disputes are handled emotionally rather than through the agreed governance framework because no one turns to it. Committees sometimes expand their reach beyond what was intended because their mandate is not revisited. Chairs may assume authority that has not been formally granted. When this pattern repeats, the charter becomes ceremonial rather than a governance tool. A governance instrument that is not applied has little practical value.
A board charter is designed to codify how the board functions within the specific context of that organisation. While it should draw on established governance frameworks, it must go further. It must interpret those principles in light of the organisation’s realities. It must translate general standards into clear, practical rules. Without that translation, the charter remains generic and disconnected from daily governance.
One of the most overlooked elements in many charters is boardroom dynamics. Many boards speak about collegiality and teamwork. Few speak clearly about dissent. Yet dissent is central to effective oversight. Directors are appointed to exercise independent judgment. They are not appointed to automatically agree with management or the majority of the board members. A robust charter must explicitly state that directors have both the right and the obligation to question proposals from management or other board members. It must affirm that raising concerns is not a sign of disloyalty. It is part of their fiduciary duty.
Psychological safety is a practical requirement for sound governance. Directors must be able to ask difficult questions without fear of marginalisation. They must know that probing a proposal will not result in subtle retaliation or exclusion. If members hesitate to speak because they fear the chair’s or dominant colleagues’ reaction, oversight becomes superficial. A well drafted charter should define expectations for respectful debate. It should state that disagreement is to be handled professionally. It should make clear that silence does not automatically imply agreement. That clarity strengthens board culture and improves decision quality.
Decision protocols are equally critical. The charter must clearly define matters reserved for the board and matters delegated to management. It must specify approval thresholds for major financial commitments. It must define how strategy is approved and monitored. It must clarify how risk appetite is determined and reviewed. Without this clarity, two undesirable patterns emerge. Either the board drifts into operational interference, or management makes strategic commitments without adequate oversight. Both patterns undermine organisational performance and accountability.
Committees introduce another layer of complexity that must be addressed carefully. Each committee should operate under its own charter that aligns with the main board charter. For example, the audit committee must understand its authority over financial reporting, internal controls, and risk oversight. The board charter must also clarify what can be handled at the committee level and what should be recommended to the full board for approval. When these distinctions are not explicit, confusion and overlap occur.
A clear definition of no-go areas is also essential. The board should not involve itself in negotiating supplier contracts, hiring middle managers, or resolving operational grievances. Management should not set executive remuneration, approve major acquisitions, or alter strategic direction without board approval. When these boundaries are not documented, friction becomes inevitable. Directors may feel compelled to intervene. Executives may feel undermined. Over time, this tension damages trust and distracts from strategic oversight.
The charter must also reinforce the principle of collective authority. Individual directors do not exercise power outside properly convened board decisions unless specifically authorised. A single director cannot instruct management or represent the board without a mandate. This distinction is frequently misunderstood, especially in environments where certain individuals carry significant influence. By clarifying collective authority, the charter protects both management and directors from informal pressure and unilateral action.
The role and limits of the chairperson deserve explicit attention. The chair facilitates meetings, shapes agendas, and ensures orderly discussion. The chair does not possess unlimited authority. The chair’s power is defined by the charter and by board resolutions. If these limits are unclear, dominance or passivity may distort governance. A strong charter clarifies that the chair’s primary function is to enable effective collective decision making, not to dictate outcomes.
There is also a practical governance practice that many boards overlook. Directors should be required to sign the charter annually. This should not be treated as a routine compliance exercise. It should be a deliberate recommitment to governance standards. By signing each year, directors affirm that they understand their responsibilities and accept the boundaries within which they operate. This reinforces accountability and signals seriousness.
When a charter is properly designed and consistently used, it strengthens board confidence. Directors understand how authority is exercised. They know how disagreements are managed. They know the limits of individual influence. That shared understanding reduces conflict and enhances focus. It also signals to stakeholders that governance is structured and disciplined rather than personality driven.
The board charter is one of the strongest foundations for effective governance. It defines authority, clarifies boundaries, and shapes behaviour. Yet many boards rarely use it after adoption. That is a missed opportunity. A simple test can reveal whether a board takes its charter seriously. When was the last time it was referenced in a meeting? If the answer is rarely or never, improvement is needed. Governance does not improve because documents exist. It improves because those documents guide behaviour.
Nguwi is an occupational psychologist, data scientist, speaker and managing consultant at Industrial Psychology Consultants (Pvt) Ltd, a management and human resources consulting firm.
