People are fundamental to the success of any business. Existing within an intricate web of favors and IOUs, relationships form the foundation of businesses. Whether you are at the bottom of the pecking order wanting to prove your worth or an executive trying to garner the support of your organization, relationships are everything.
Lauren Zajac, Chief Legal and Compliance Officer and Corporate Secretary of ExtraHop, is acutely aware of this and she prioritizes investing time and effort into her business relationships. Of particular focus are her relationships with the board and investors. "When they ask you do something, it's natural to jump and act with urgency."
Fostering a transparent relationship with both the board and investors is critical to her success as a legal leader. Trust is imperative - between both parties. While the board and investors may have a vision for which direction they want a company to take, the executive is the person who can implement this change.
Countless publications exist on the relationship between the CEO and the board. This relationship translates to other executive roles, such as the Chief Legal Officer. As KPMG notes, achieving a "healthy tension" in the boardroom is no easy feat. They say the ideal environment is one where "the board supports the CEO and management team while maintaining objectivity, independence and scepticism." Finding the balance between trust and critique takes constant maintenance.
So how can one work on their board-level relationships? Communication is the obvious answer. Regular conversations and sharing of information between the executive leadership team and the board is essential. Zajac recommends making sure the board is cognizant of your particular skillset and strengths, so they can understand what you can bring to the organization.
In Zajac's case, her extensive knowledge of employee engagement, due to 15 years working for Workhuman, an employee recognition company, was extremely valuable to the board. She was tasked with the challenge of implementing a leadership education program to foster inclusivity, appreciation and recognition within the business.
Investors are increasingly willing to weigh in on company strategy, says Harvard Business Review. Zajac says that in the venture capital world, getting to know your investors is on you as the CLO. They want the best shareholder value possible, and company strategy is intricately connected to this reality.
The CLO's role is tied to risk. Every business and its investors has a different risk profile and appetite. Start-ups tend to have a higher propensity for risk than, say, a large corporate or medium-sized business. If the CLO wants a good relationship with their investors, they should determine the level of rigor investors (and the board in this instance) would like to see when it comes to contextualizing risk.
Social impact is often on investors' minds too. Although it doesn't directly correlate to shareholder value, it can align with their personal values. From diversity, equity and inclusion (DEI) initiatives to sustainability incentives, ethical business is a driver for many investors who want to use their money to do good in the world. In this circumstance, the legal team has a whole new area of investigation - shining an ethical microscope on potential clients, customers and deals.
Managing board and investor relationships is like dancing a complicated waltz. Constant communication is required, as well as an understanding of your partner's (or, shall we say, stakeholder's) intentions. Not to mention being in tune with where they may pivot next and keeping tabs and all the other dancers in the room. In layman's terms, you can't just expect to have great relationships with key stakeholders; as Zajac points out, great relationships take constant maintenance.
Self-management is also crucial. Zajac sagely notes that one must be working on themselves in order to bring their best self to a leadership position. Sometimes that means treating yourself as you would others; Zajac is no stranger to imposter syndrome - a struggle many leaders face. She notes that "normalising mistakes and learning allows your to trust yourself." If you want to build relationships of transparency and trust with board members and investors, trusting oneself is the first step.