Jeff Jarvis has written a wonderful book What Would Google Do? that covers his thoughts on navigating the digital social world; both from a business and a personal perspective.
I thought it would be appropriate to add a Jarvis inspired perspective to the recent timely postings on board communication by Josh Kopelman and Fred Wilson. Jeff cites an inverse relationship between control and trust. He espouses that as an institution (or individual) marshals centralized control, the degree of control has a reverse correlation with the amount of transparency offered. Control turns people off; transparency makes them feel part of your community and more likely interested in your success.
Using company examples, community members of Facebook, Twitter, and Friendfeed are deeply invested in the success of 'their' platforms. They spend time to build applications, provide content and proffer unsolicited feedback for the selfish reward of looking to improve and extend 'their' experience; way more than 'users' participate in the success of traditional hierarchal ecosystems (MSFT/IBM). Just think of the difference between 'users' and community 'members'. It's not sematics, it's company DNA. This cultural shift facilitates a virtuous cycle of rapid adoption of software that has near simultaneous bottom-up and top- down development that is anathema to the control ethos of 'brick and mortar' software vendors; an evolution from the open source model. It's a critical reason for the success of these aforementioned and other similar entities.
This concept is also critical in the ways a CEO builds a relationship with a board. Access to timely, relevant, and unvarnished information (vs data), builds a simultaneous top-down and bottom-up feedback loop on company progress, challenges and threats. It begats trust and, therefore, a diminished desire for control.
Of course, performance is a clear way to engender trust. But, let's face it, we are living in a world where adversity and ecosystem sea changes are the norm that comes with a CEO's job description. Dealing with the inevitable challenges in an open way, with a spirit of partnership is a necessity in a real-time world where you are accustomed to being but a Twitter, a post, or Salesforce.com view away from information you want (and don't). Why should communications with a board be different?
The bar for CEO communication with a board has been raised as people are accustomed to running their businesses and personal lives in a real time manner. A community of investors/board members is really no different that a community of customers and employees. They expect, and will soon demand to be treated in a similar manner.
It's true, trust is hard to earn, yet easy to lose.