How is Boardroom Politics defined? Give an example of a current event which demonstrates Boardroom politics in action. Boardroom politics is defined as a decision making by business elites and professionals but with important public consequences. According to Van Horn, Baumer & Gormley (2001) boardroom politics in the private decision making are literally made in corporate boardrooms; others are made at lower levels by corporate managers subject to constraints imposed by a board of directors. Boardroom politics are more hierarchical than cloakroom politics, more competitive than bureaucratic politics and more volatile than courtroom politics.
Boardroom politics has become more visible and more controversial since the 1960s and still private (Van Horn,Baumer & Gormley 2001). Therefore boardroom politics does become controversial and continues to gain in the politic policy process. Its implementation is known both in public and private sectors that describes political process for the scope of conflict in a broader sense by examining the process to make comparisons by its use. The example from current events that demonstrates boardroom politics can be someone’s leaking to the press!
An article from Christian and Timbers leaked information to the press. According to Christian and Timbers (2010) “the exercise destroyed what little sense of common purpose remained at the company’s most senior cadre, and may yet result in criminal charges. Hewlett-Packard has admitted using private investigators to access phone records of board members to see who had been talking with journalists. Chairman Patricia Dunn stands accused of orchestrating this activity.
Director Tom Perkins resigned in protest, calling for the chairman to go, and in September Dunn resigned. ” The article suggests that boardroom political games and spats erupt frequently onto the business pages. Another recent example was Vodafone, where chief executive Arun Sarin has been embroiled in a fierce and public battle at the board of the world’s largest mobile phone company. Given the repercussions that such disputes can have, it is worth considering whether they can be either avoided; also whether the energy generated by a policy or personality clash can be channeled into creative activity .
According to Christain & Timbers (2010) There are some unique features of operating at board level, however, and one is the recent flurry of new corporate governance rules. Some of them appear to be at odds with the desire for teamwork and understanding, and so require careful implementation. There has been much emphasis on greater openness and on independence of the background of non-executive directors, to prevent ‘chummy’ cliques operating against shareholder interests.
The separation of the chairman and CEO roles are emphasized, and quite rightly; these are distinct areas of responsibility that should not be blurred. The chairman is responsible for the board; the CEO for running the company.
