Challenging Assumptions

Every board makes assumptions.

Markets will remain stable. A strategy will succeed. A risk is adequately understood. Management has considered every alternative.

The strongest boards recognize that assumptions are often the greatest source of risk—not because they're wrong, but because they've never been challenged.

Before making consequential decisions, directors should pause and ask:
What assumptions are we making that have not been challenged?

Sometimes the most valuable contribution an independent director can make isn't providing an answer—it's asking the question that changes the conversation.

Question for Directors:
How would your board answer this question?