Employee health and wellness rarely make their way onto formal board agendas. Yet they may influence some of the very outcomes boards care most about: strategy execution, risk management and long-term performance.
That was the central argument from Melissa Barra, director of Pentair and Blue Cross and Blue Shield of Minnesota, in a recent discussion on governance and human performance. To Barra, wellness is not a “soft” topic. It is a core governance issue hiding in plain sight.
“Board members are responsible for three key areas: performance, risk management and culture,” says Barra. “Employee health and wellness falls squarely within this responsibility because, after all, it directly impacts a company’s resilience, its ability to manage risk and, ultimately, its performance.”
For boards accustomed to focusing on financial metrics and strategic milestones, that framing is important. Wellness is not an add-on to governance. It is embedded in the system that determines whether strategy succeeds or fails.
The Strategic Case for Sleep
Among the various dimensions of wellness, Barra points to one that is often overlooked but deeply consequential: sleep.
“I would argue that sleep is a strategic necessity,” says Barra. “In fact, the lack of sleep can be a business risk factor.”
According to Barra, sleep-deprived employees are significantly more likely to experience burnout and struggle with decision-making and focus. For directors, the more pressing concern may be what happens at the executive level, where fatigue can quietly degrade judgment at precisely the moments when clarity matters most.
“Sleep deprivation impairs executive functioning, including attention, decision-making and emotional regulation,” says Barra. “Research shows that the lack of sleep compromises rational thinking and judgment. It leads to risky decision-making.”
The implications are particularly acute during high-stakes periods, such as mergers and acquisitions, turnarounds or crises. In those moments, boards are often evaluating management decisions with long-term consequences. Yet, if leaders are operating under sustained fatigue, the quality of those decisions may already be compromised.
Barra underscores the point with a stark comparison: “People who sleep less than six hours a day for one week function similarly to someone who is legally intoxicated.”
That reality reframes sleep from a personal habit to a governance concern. If decision quality is impaired, so, too, is the board’s ability to rely on management’s judgment.
Conversely, well-rested leaders have a measurable advantage. “Good sleep is a performance multiplier,” says Barra. “It improves decision-making, stress management, creative problem-solving, strategic thinking — you name it.”
In other words, sleep is not just about avoiding downside risk. It can be a source of competitive advantage.
Shaping Culture Without Managing It
Boards do not run day-to-day operations, and they cannot dictate culture directly. But they do influence it in powerful ways.
“Boards don’t and truly can’t manage day-to-day culture, but they absolutely shape its direction through what they emphasize, what they measure and, as importantly, what they model,” says Barra.
That influence begins with what is discussed in the boardroom. If wellness, burnout and sustainable performance are never raised, they are unlikely to become priorities for management. Barra suggests several practical entry points for directors.
First, integrate wellness into existing discussions rather than treating it as a stand-alone topic. In talent reviews, boards can ask for indicators such as turnover, engagement and burnout risk. In strategy sessions, they can probe whether teams have the resources and capacity to deliver on ambitious goals.
“When you’re talking about stretch goals, understand when those stretch goals are becoming unsustainable,” says Barra. “You’re trying to ensure that the company isn’t running too hot for too long.”
Second, boards can encourage policies that reduce structural drivers of burnout, such as excessive meetings, constant connectivity and unrealistic travel demands. These may seem like operational details, but they aggregate into cultural norms that shape performance over time.
Third, leadership development offers a longer-term lever. Companies can incorporate resilience, recovery and sustainable performance into executive training, ensuring that future leaders are equipped to operate effectively under pressure.
Fourth, boards should model the behaviors they want to see. Barra noted that even simple actions, such as normalizing conversations about rest and recovery, can signal that wellness is valued.
“I explicitly ask leaders and the CEO if they’re taking the time to rest and recharge,” says Barra. “By asking about health, wellness and sleep on a consistent basis, as a board, you can create real accountability.”
Measuring What Matters
For many directors, the challenge is not recognizing the importance of wellness but determining how to measure it.
Barra’s advice is to treat wellness like any other strategic investment: Track the outcomes that matter and tailor the analysis to the company’s context.
“There are three metrics that tell you a lot,” says Barra. “Retention rates, engagement scores and healthcare costs.”
Those indicators provide a baseline, but boards should go deeper. The relevant data will vary depending on the company’s strategic priorities. A growth-oriented business might focus on sales team engagement and retention. A company in turnaround mode may need to examine operating and finance teams more closely.
For organizations with more mature wellness programs, additional metrics, such as participation rates and employee feedback, can offer insight into whether initiatives are gaining traction.
The key is alignment. “Boards should measure them in the same way that they measure any strategic investment,” says Barra. “By tracking those human and financial outcomes that matter.”
A Governance Issue Hiding in Plain Sight
The broader lesson for directors is that performance, risk and culture are deeply interconnected. Wellness sits at the intersection of all three.
Fatigue can erode decision-making. Burnout can undermine execution. Poor health can increase turnover and weaken organizational resilience. Each of these dynamics ultimately shows up in financial performance, but often only after the underlying issues have taken hold.
By bringing wellness — and particularly sleep — into the governance conversation, boards can surface risks earlier and support more sustainable performance over time.
In an environment defined by constant change and pressure, the companies that perform best may not be those that push hardest, but those that sustain high performance without breaking their people.
For boards, that starts with asking a simple but powerful question: Are we governing the conditions that enable our leaders and teams to perform at their best?