When Should a New CEO Commission a Board Effectiveness Review?

By Kirsten Smith, Chartered Governance Professional

Most new CEOs wait. They want to understand the organisation first, form their own views, build relationships with the board. That instinct is understandable. But the best time to commission an independent board effectiveness review is earlier than most leaders think.

I want to tell you about a CEO I worked with recently who did something different.

Walking Into a Room With Its Own History

She had been in the role for a matter of weeks when she called me.

She was new to the organisation. She was inheriting a board with its own history, its own dynamics, its own unwritten rules and established relationships. And she understood instinctively that the only honest way to get a clear picture of what she had walked into was to ask someone with no stake in the answer.

She commissioned an independent board effectiveness review before she had formed strong opinions of her own. Before the relationships had calcified into assumptions. Before she had unconsciously decided who was an ally and who was a problem. She wanted an independent picture of how the board was actually functioning, taken while her own lens was still clean.

I had not seen anyone do it quite that way before.

Why Timing Matters in a Board Effectiveness Review

Most board effectiveness reviews are commissioned for one of two reasons. Either something has prompted a reckoning, an underperforming board, a regulatory prompt, a governance failure, or a leadership change that has surfaced tensions. Or the board is genuinely curious about how it is performing and wants an honest external view. Both are completely legitimate reasons to undertake a review.

But this CEO had identified something that most leaders miss: the best time to take an honest look at something is before you need to.

When the organisation is stable, the board can afford to be genuinely reflective rather than defensive. When the findings emerge before anyone has a vested interest in a particular narrative, they can be a starting point for a productive conversation rather than evidence in an argument. When the CEO has not yet formed entrenched views, the review findings can shape their leadership approach rather than challenge it.

There is a window, early in a new CEO's tenure, when a board effectiveness review can have an outsized impact. That window is shorter than most people think.

What an Independent Board Effectiveness Review Actually Does

An independent board effectiveness review examines how the board is functioning: its composition, dynamics, decision-making processes, oversight of risk and strategy, committee effectiveness, and the quality of the relationship between the board and management.

It does this through a combination of confidential surveys and one-on-one interviews with every director and relevant executives. Because every participant speaks to an independent external reviewer rather than to each other, people say things they would not otherwise say. Patterns emerge that are invisible from inside the organisation.

The findings are reported thematically, not attributed to individuals. The result is an honest, evidence-based account of how the board is actually working, its genuine strengths, the things that are functioning well beneath the surface, and the areas where improvement would make a material difference.

For a new CEO, this is extraordinarily valuable. It means that within the first few months of tenure, they have an independent, structured picture of the governance environment they are operating in. Not filtered through the views of their predecessor. Not shaped by which directors they have warmed to most quickly. Not distorted by the dynamics of early relationship-building.

Just an honest account of what is actually there.

The Case for Acting Early

New leaders are under enormous pressure to demonstrate competence quickly. Commissioning a board effectiveness review early in tenure signals something important: that this CEO understands governance, takes the board relationship seriously, and is not afraid of honest information.

It also does something more practical. It gives the CEO a legitimate, structured basis for having conversations with the board about how it works, what it needs, and where the relationship between the board and management could be strengthened. Those conversations are much easier to have when they are anchored in independent findings rather than the new CEO's personal observations.

A review conducted early also establishes a baseline. When the CEO commissions a follow-up review in two or three years, there is something to measure against. The board's improvement trajectory becomes visible. The governance investment compounds.

What the Review Revealed

In the case of the CEO I described, the review surfaced several things she had sensed but could not yet name. A committee structure that had grown organically and no longer reflected the board's actual priorities. A gap between the board's stated appetite for strategic discussion and the papers it was actually receiving. A small number of dynamics in the boardroom that were subtly shaping who spoke and who did not.

None of these were crises. All of them were correctable. And because they were surfaced early, while the CEO was still establishing her leadership approach and before the board had formed fixed expectations of her, they were addressed from a position of genuine collaboration rather than defensiveness.

She told me afterwards that having that independent picture in the first three months had shaped everything that came after it.

A Different Way of Thinking About Board Reviews

The dominant narrative around board effectiveness reviews is that they are remedial. Something you do when things are not working. A response to a problem rather than a tool for building something better.

That narrative is shifting. Regulatory bodies including APRA recommend independent external reviews at regular intervals precisely because good governance does not sustain itself automatically. It requires honest external input, structured reflection, and a willingness to look clearly at how things are actually working rather than how they are assumed to work.

But beyond compliance, the most governance-mature organisations treat board effectiveness reviews as a normal part of how their boards operate. They commission them proactively. They use the findings to have better conversations. They build on them over time.

A new CEO who understands this is not just making a smart governance call. They are signalling to the board, to the organisation, and to themselves what kind of leader they intend to be.

Is Your Board Due for a Review?

Whether you are a new CEO, a Chair looking to establish a stronger governance baseline, or a board that has been operating on internal reviews for several years, an independent board effectiveness review provides something that cannot be replicated internally: an honest, external account of how your board is actually functioning.

The best time to commission one is not when you are in crisis. It is when you can afford to be curious.

Governance in Focus conducts independent board effectiveness reviews for listed companies, regulated entities, not-for-profits, and mission-driven organisations across Australia. Get in touch to discuss your board.