Governing strategy and risk: How boards can steer the future

By Nqobani Mzizi

In the theatre of corporate leadership, strategy is often presented as a management exercise, being something crafted by executives, presented in compelling slides, and approved by the board before being shelved until the next annual review.

But governance theory, particularly King IV, challenges this view. Principle 11 is unambiguous: the governing body should govern risk in a way that supports the organisation in setting and achieving its strategic objectives. That is, strategy cannot be separated from risk, and boards cannot be passive participants in either.

From observations of governance practice, it appears that the board’s involvement in strategy tends to be more reactive than generative. Strategic plans are often presented for endorsement rather than developed in close partnership with the board. Even multi-day strategic planning workshops, intended to promote alignment and long-term vision, can end up validating management’s predetermined direction, rather than enabling critical reflection or true co-creation.

Yet, the board’s role in strategy is not merely to approve, it is to shape. It is to interrogate, anticipate and guide the organisation’s navigation through complexity.

The MTN Group offers a compelling case of the dynamic interplay between strategy and risk. Operating in more than 18 countries, many of which present volatile political and regulatory conditions, MTN has had to continuously recalibrate its strategic posture. Its challenges have ranged from a record-setting regulatory fine in Nigeria to managing sanctions exposure in Iran and dealing with compliance scrutiny in multiple jurisdictions. Each of these moments has tested the resilience of MTN’s governance structures and demanded strategic agility from its leadership.

Yet, despite these headwinds, MTN has continued to evolve, shifting from being a traditional telecoms provider to a broader digital operator, with fintech and mobile banking now central to its growth strategy. This expansion has introduced new layers of risk, including cybersecurity, financial regulation and data privacy. Through it all, MTN’s board has had to play a critical role in balancing opportunity with caution, growth with governance.

In this context, a board cannot simply react. It must be deeply embedded in understanding the environments the business operates in, the stakeholder pressures it faces and the direction the company is moving toward. The strategic pivot toward becoming a digital services provider across Africa, rather than remaining only a telecoms operator, is a massive shift. It alters the risk landscape, invites new competitors, and demands new strategic capabilities. For a board, this goes beyond being an issue of oversight. It is one of direction-setting.

King IV encourages boards to ensure that strategy is not developed in isolation from the organisation’s risk appetite and its long-term value creation goals. Principle 4 reinforces this by asserting that purpose, risk, opportunity, strategy, performance and sustainability are inseparable elements of the value creation process. This means governing risk is not a brake, it is a compass. Risk should inform, not inhibit, strategic thinking. Yet, too many boards only engage with risk through the audit and risk committee’s heatmaps and registers rather than seeing risk as central to framing opportunity.

Where MTN’s board demonstrated resilience in the face of adversity, Tongaat Hulett’s governance unravelled under intense financial and ethical pressures. While the company’s strategy, centred on agricultural production and property development appeared sound, it was later revealed that management had deliberately misrepresented financial results, overstating assets and revenue over several years. Although the board may have been misled by executives’ intent on concealing the truth, this does not negate the importance of robust, independent scrutiny.

Even well-constructed strategies require validation against internal controls and financial integrity. In hindsight, stronger challenge and more probing oversight might have helped surface concerns earlier. The strategy, though seemingly coherent, was built on flawed assumptions and insufficient transparency, revealing how strategic governance can falter not only through negligence but also through misplaced trust.

To govern strategy effectively, boards must go beyond surface-level presentations and engage meaningfully with the assumptions, risks and long-term objectives that underpin the organisation’s direction. This requires both critical inquiry and contextual awareness. Too often, strategies are based on outdated data or overly optimistic forecasts, with boards accepting projections without testing their realism against emerging economic, political and technological realities.

A risk-based strategy, as envisaged in King IV, calls for continuous interrogation, not only of external threats, but also of internal blind spots, capabilities and culture. Governance that merely rubber-stamps strategy, without challenging its basis, exposes the organisation to material risk. Boards must therefore play an active role in shaping, refining and stress-testing strategy throughout its formulation and execution.

An effective board engages not only with the content of strategy but with the process through which it is formed. It ensures that multiple voices are heard, particularly those of risk, sustainability and technology leaders. It understands that strategy is not just a forecast. It is a set of choices about where to play and how to win, made in a context that is always shifting.

Moreover, boards must remain agile. The strategy set in January may need adjustment by July. This is especially true in a post-pandemic world disrupted by AI, climate shocks, and geopolitical volatility, among other factors. Boards that fail to revisit strategy in the face of change risk undermining organisational resilience.

This demands courageous governance, the kind that trades politeness for probing questions, and oversight for ownership. It means being willing to challenge the executive team’s narratives, to voice dissent, to ask uncomfortable questions about ambition versus capacity. A board that is too polite, too deferent, or too focused on oversight rather than direction risks becoming irrelevant. The future of governance belongs to boards that are intellectually engaged, emotionally resilient and strategically aware.

The board’s role in strategy is not to rewrite the business plan but to ensure that the strategy is rooted in reality, aligned to purpose, responsive to risk, and capable of creating long-term value.

And so, to board members everywhere, four questions remain:

• Is your strategy a living framework or a static document?
• Can your board connect the dots between risk and value creation in every major decision?
• Do you truly understand the external forces reshaping your industry, and are you adjusting accordingly?
• And most importantly, are you governing strategy, or just approving it?

If strategy shapes destiny, then the board must be more than a steward. It must be its architect.

* Nqobani Mzizi is a Professional Accountant (SA), Cert.Dir (IoDSA) and an Academic.

** The views expressed do not necessarily reflect the views of IOL or Independent Media.

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