For those of us dedicated to creating meaningful change, one of the most persistent issues in corporate (or organisational) governance today is the misalignment of incentives. We know that incentives are powerful drivers of action, guiding priorities and outcomes. But often, they nudge companies in ways that feel at odds with the impact we are here to achieve, especially when short-term performance becomes the sole focus.
In a board setting, these short-term pressures often find their way into performance evaluations, shaping what board members and executives are rewarded for. In both the corporate and non-profit sectors, the metrics we use to evaluate “success” can unintentionally prioritise the present over the future. For charities or schools, the incentive may be to cut costs to please philanthropic or government funders, while in the corporate world, it’s frequently about maximising short-term profits for shareholders.
Yet, for those of us committed to creating a sustainable legacy, this approach can feel limiting—possibly even counterproductive.
The Role of Boards in Aligning Incentives
As stewards of the future, board members have an opportunity and responsibility to realign these incentives, shaping them to reflect the organisation’s mission, purpose, and values. This alignment process includes board performance reviews (often called evaluations or health checks), where the criteria used to assess the board’s impact can become a powerful tool for refocusing on long-term outcomes and sustainable success.
Reviews like this can, and should, measure how well board members foster sustainable practices, ethical leadership, and resilience rather than just financial performance. By ensuring that incentives align with the long-term health of the organisation, we move closer to fulfilling our mission and purpose.
But, this isn’t a call for abandoning fiscal responsibility or performance metrics—it’s about enhancing these tools to reflect the impact we truly want to make.
Building Trust as Part of the Legacy
As we realign incentives, we’re also building a foundation of trust. Trust is at an all-time low across many sectors, with public, shareholder and stakeholder confidence continually tested by decisions that seem driven by quick wins over steady progress.
When employees, funders, or customers see that a company prioritises enduring relationships and ethical practices, trust builds, and with it comes engagement, loyalty, and commitment—cornerstones of a lasting legacy.
For board members, trust begins within your own ranks, in how we work together and with our executive teams. It’s our responsibility to ensure that the metrics driving our organisation forward reflect shared values and long-term resilience and sustainability. This alignment of purpose, incentives, and trust doesn’t just benefit today’s stakeholders; it strengthens the organisation for future generations, creating a reputation for integrity that endures.
Leveraging Evaluations for a Sustainable Future
Evaluations are one of the most practical tools for fostering this alignment. When we redefine what “performance” looks like, we redefine what leadership stands for within the organisation.
Thoughtfully developed performance reviews that assess long-term impact and relationship-building allow board members to showcase their commitment to true stewardship. Done right, they create an environment where every incentive points toward a sustainable, purpose-driven future.
Ultimately, when boards lead with aligned incentives and authentic evaluations, we create a culture where people know the organisation values more than today’s gains—it values tomorrow’s legacy. This approach attracts partners, talent, and supporters who believe in the company’s values, strengthening the foundation for the future they are working to build.
In a time where public trust is fleeting, creating this kind of legacy isn’t just impactful—it’s essential.
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