Most directors believe they want candour from their chief executive. Most chief executives believe they provide it. Both are often wrong, and the delta between what is said in boardrooms and what is actually happening in the organisations below them is one of the more reliable predictors of strategic failure in corporate life. The research on this is unambiguous. Information flowing upward through a hierarchy is systematically softened at each layer; dissenting directors are quietly marginalised by their peers; high-status CEOs are subjected to enough flattery and opinion conformity so that belief in their unerring strategic judgement inflates in proportion to the contraction of dissenting opinion. The result is an organisation whose account of itself, by the time it reaches the board papers, has been through more edits than a political memoir.
The oldest and most instructive treatment of this problem is not in a governance handbook but in the writings of Thucydides (460–400 BC). In the winter of 431 BC, Pericles (495–429 BC) rose to deliver the Funeral Oration that is now one of the most celebrated piece of political rhetoric in the Western tradition. What is less often noticed about that speech—and about the three decades of leadership that preceded it—is that Pericles had solved the problem most boards have not. He had built, over a career, the kind of authority that allowed him to tell the Athenian assembly what it needed to hear rather than what it wanted to hear, and to survive the telling. When he finally lost that authority, Athens lost the war. The sequence is worth attending to, because the pattern repeats, and it is repeating now in boardrooms that would be uncomprehending if they were compared to a fifth-century Greek assembly but are, in the relevant respects, behaving identically.
