How empathy driven boards achieve better strategic outcomes

“How can we reset the board’s perspective to look outside the bubble — to be mindful that there are people behind every strategic decision that is made?” says Samara from Fremantle, WA.

A quiet danger creeps into the boardroom over time — distance. Directors begin to see the organisation through balance sheets and dashboards rather than the everyday reality of its people. Strategy is discussed at a high level, yet the human consequences are rarely part of the conversation.

This isn’t due to malice or neglect. It’s structural. Most directors operate within tightly filtered information channels. Reports are streamlined. Data is sanitised. Bad news is softened by the time it hits the table. Surrounded by other high-level thinkers, often with similar professional backgrounds and networks, the boardroom is an echo chamber. Within that environment, it is easy to forget every decision impacts real lives.

The executive bubble

The “executive bubble” mindset prioritises theory over reality, efficiency over empathy. When job cuts are on the table, they’re framed as a financial necessity. Outside that room, those same decisions mean lost livelihoods, increased stress and entire teams left to carry the weight. Yet at the next board meeting, the primary discussion point is whether the cost savings materialised.

This detachment extends beyond restructures. Some boards greenlight technology overhauls without understanding how frontline teams will implement them, or slash budgets with no visibility into operational fragility. It’s not uncommon for directors to speak fluently about strategic imperatives while having only a vague grasp of how their services are delivered on the ground.

Bridging the gap

To reset perspective, boards must step outside the bubble and re-centre the human elements of governance. Here are five actions boards can take:

1. Get involved with the business

Directors should engage directly with operations, whether touring facilities, sitting in on customer calls or spending time with service delivery. Do it without an entourage. Listen more than you speak. A half-day shadowing frontline workers can yield insights no board paper ever will.

2. Recognise the human impact of decisions

Every agenda item has a people dimension. Before signing off on any major change, ask, who does this affect? What support is in place for them? Will it create unintended consequences for customers, staff or community? These are strategic questions, with real governance implications.

3. Encourage unfiltered feedback

The boardroom is often the last place to hear the truth. Establish safe pathways for staff and middle management to share direct input, whether through anonymous surveys, independent reviews or inviting staff to present at a board meeting. Don’t just rely on executive summaries. Boards that understand the unvarnished truth are better equipped to govern responsibly.

4. Challenge groupthink and strategic inertia

Too much agreement is a warning sign. Create space for dissent. Play devil’s advocate. Rotate who leads discussions on contentious issues. Diversity around the board table helps, but is not enough on its own — the culture must value curiosity, critical questioning and alternate perspectives.

5. Reframe the organisation as a living system

The company is not an abstract concept. It’s people, services, culture, history, purpose — interconnected in complex ways. Effective directors don’t just understand the business model, but also the human system that sustains it. The further a board gets from this reality, the more fragile its decision-making becomes.

Get closer for better governance

Reconnecting with the people behind the metrics is about rigour. Boards anchored in human reality make more ethical, sustainable and effective decisions. Governance is not just oversight, it’s stewardship. Show up for the complex human dynamics that make organisations what they are.

Kirsten Smith GAICD is CEO and founder of Governance in Focus, advising boards and executives on governance effectiveness, strategic alignment and culturally aware leadership. She has worked across major ASX-listed companies, regulatory bodies, clean energy and community organisations.

This article first appeared under the headline 'Where is the human aspect?’ in the September 2025 issue of Company Director magazine.