Abstract:
The aim of this research was to understand the role of the Chairman of the Board of Directors in strategy formulation and how he / she values strategic choices. The methodology used to research these questions was in-depth interviews with Chairmen of 15 Boards in New Zealand across 6 different sectors. The results show that Chairmen in New Zealand are actively involved in not only making strategic decisions but also shaping the context , content and conduct of strategy. The findings also reveal that Chairmen of Boards in New Zealand predominantly use qualitative business judgement to make strategic decisions, are normally risk averse when faced with competing choices and a significant minority are cognitively biased towards risk seeking behaviour to limit their losses. The key takeaway from this research is that Chief Executives of organisations should be actively engaging in dialogue with Chairmen of Boards outside of the formal process of board meetings especially when it comes to shaping strategic decisions.