A business colleague told me the story of a Board which was looking for opportunities to invest a substantial trust fund. After reviewing and rejecting several investment proposals, some Board members were getting impatient and anxious about losing revenue while waiting for the right investment opportunity to come knocking.

Sure enough, opportunity did eventually knock, and the investment proposal that came with it seemed quite promising. Board members were jubilant and thrilled: At last, the trust fund was going to find a safe home and earn substantial returns on investment for the organization. Most were eager to move forward, except for one quiet member. Given his own investment expertise, he could identify significant flaws in the proposal.

Given his observations and concerns, this Board member faced a dilemma. On the one hand, he suspected that the proposal was not as good as it was made out to be. On the other hand, he saw the enthusiastic faces of his colleague Board members who were eager to move forward and were quite impatient, and was loathe to spoil their enthusiasm. He hesitated for a moment, and then decided to remain quiet.

The proposal was then accepted and the money was promptly invested. Shortly thereafter, the financial results indicated that this was not such a good investment after all. As the losses mounted, the collegiality vanished and people began to look for guilty parties. It was then discovered that a Board member suspected there were problems with the proposal and did not speak up. Consequently, this member was sued for not speaking up. The premise was that his duty to speak up was more important than his need to avoid being unpopular with his colleagues.

The business colleague who related this story to me did not know the result of the lawsuit, and, really, that is not the point of this story. As I considered it, this incident raised some interesting questions, especially since I usually suggest to clients that finding individual faults should come only after any systemic issues have been identified. The problem may not be solely with the individual, and therefore seeking to punish him or her may solve only a part of the problem. Indeed, punitive measures may not prevent the same problem from re-occurring in the future. They may also create some undesirable side effects, such as a toxic environment and fear-driven decision-making.

How does this principle apply in this case? Instead of (or in addition to) identifying guilty individuals, one might ask a few questions about the decision-making system and the group's culture, such as: Who is really to blame for the failure of the decision-making process, the silent Board member or the meeting environment? Is it risky for a Board to become too collegial? Can an overly friendly, exuberant and fun meeting environment make it unsafe for people to ask tough questions or raise unpopular but much needed perspectives? Can the fear of upsetting colleagues impair a member's ability to to focus on maximizing opportunities while minimizing risks for the organization?

Additionally, the following questions need to be asked: Have the roles of Board members as partners in decision-making been established? Is it clear that it is their duty to scrutinize proposals with care, and that a happy and collegial environment, although an asset, should never come at the expense of effective decision-making? Has it been established that decisions must be based on knowledge, and that the Board must not be distracted by impatience and emotion? Is it clear that a safe learning environment must be maintained, and that all valid views and perspectives, including unpopular ones, are crucial to the integrity of the decision-making process?

Until the above systemic issues have been addressed, any punitive measures directed at individuals will achieve little, and may indeed create more problems than they solve.