Sugar-coating in the boardroom: The silent business killer
In my work advising billionaire entrepreneurs, presidents of Fortune 500 companies and the heads of family business empires, I’ve seen this again and again. One of the biggest—yet least discussed —problems in business is the sugar-coating that happens at the very top. Board members, senior executives and even family members often avoid telling the full truth. And when that happens, CEOs or business owners end up with a misleading picture of the company’s actual performance.
The damage? Delayed decisions, miscalculated risks, missed opportunities—and sometimes, a painful downfall. Let’s pull back the curtain and address the uncomfortable, but necessary, harsh truths.
Harsh truth No. 1: CEOs don’t see reality clearly—The illusion of stability
Sugar-coating fosters a dangerous illusion: that everything is stable, that there’s no reason to worry. The business seems to be humming along just fine—until it’s not.
Underneath the surface, fires may already be smoldering—underperforming divisions, customer dissatisfaction, declining margins, cultural toxicity. But if those around the CEO only report the good news, course corrections are delayed, and warning signs go unnoticed until it’s too late.
Persian messenger syndrome
In ancient Persia, messengers who brought bad news were punished—or even killed. Today, many executives act the same way: not with swords, but with disapproval, loss of trust, or dismissal. This leads to an echo chamber of positivity.
At a major Asian family business conglomerate, one board member had become completely ineffective. Privately, the rest of the board admitted it. But publicly, they covered for him—out of respect, fear or loyalty. The owner operator, who was the president, was completely in the dark. After he asked me and my team to future-proof and grow his business, we did a deep dive and quickly saw the full extent of the chaos. The result? We replaced the boardmember, and the company saw an additional 17 percent increase in profitability within a year.
Harsh truth No. 2: Executives lie
Let’s stop pretending. Even senior executives lie. Not always with malicious intent— but they bend the truth, omit uncomfortable details or present overly optimistic versions of reality.
They may hide problems in their division, inflate projections or downplay operational bottlenecks to protect their jobs, reputations or bonuses. This façade distorts decision-making at the top.
Let’s take yearly corporate strategic planning sessions, for example. If I were to print out every single page of BS I have come across in my many years of experience leading or assisting such sessions, it would easily cover the distance between Paris and New York.
Harsh truth No. 3: ‘Loyal’ doesn’t mean ‘honest’
Many CEOs confuse loyalty with honesty. This is especially true for family businesses where owner-operators love loyalty. Just because someone has been with the company for 10 or 20 years doesn’t mean they’re telling you the truth, however.
We exercise extra caution with executives who’ve been around a long time. They’re often inherently trusted by business owners—especially in family-run firms—but their performance rarely receives the same scrutiny. Loyalty becomes a cloak that shields them from accountability.
In a client example from the United States, a large family business empire, one top executive had been occupying different senior leadership positions for decades. He had done an awesome job—10 years ago! But not anymore. Yet, he still led the board meetings and occupied major positions. When we did a deep dive into the business, we quickly saw that he cost the company many millions because he was simply not performing.
Harsh truth No. 4: Family members lie
This one’s difficult, but essential. In family businesses, family members—especially those embedded in the business—may present skewed realities, either to protect themselves or to maintain family harmony.
They might inflate their department’s success, minimize internal conflict or hide the truth about operational challenges. Sometimes, they themselves are unaware of how deeply they’re distorting reality.
And no one wants to call them out. Why? Because it’s family.
Harsh truth No. 5: Everybody is afraid of conflict—Even CEOs
Fear of conflict exists at every level of a business. Middle managers, top executives and even CEOs would often rather avoid uncomfortable conversations than face the fallout.
In family businesses, this is magnified. Leadership is often held in high regard, almost revered, because the owner-operator is not only on top of the business, but also socially and on the net worth ladder. So, board members and senior executives hesitate to present negative feedback. They focus on positive developments, leading to overconfidence and strategic blind spots.
At a highly profitable US family conglomerate, the CEO —himself a family member—was receiving only filtered feedback. Board meetings were full of agreement but lacked honest push back. After working with our team, three board members were replaced, and the quality of decisions skyrocketed. Business performance followed.
Harsh truth No. 6: Bending reality —The privileging hypothesis
People tend to bend reality in favor of their own area of influence. This is a natural bias, but in business,it becomes dangerous.
Executives, managers and even family members often unconsciously (or consciously) prioritize their own performance narratives. They highlight what makes them look good and hide what doesn’t.
The result? A distorted, fragmented and often inaccurate picture of the business’s true health. And when everyone’s doing it, the CEO ends up steering the company through a fog of half-truths.
Your three to thrive
Great leaders build systems that reveal the truth—no matter how uncomfortable it is.
1. Realize that truth is a strategic asset
If you’re a CEO or business owner-operator, your greatest risk isn’t external competition—its internal distortion.
When reality is sugar-coated at the top, the entire business suffers. The delay in correcting course, the blindness to risk, the arrogance of unchallenged strategy—these are the silent killers that take down giants.
2. Build in skepticism and paranoia
Legendary business builders—from Jeff Bezos to Andy Grove—instinctively assumed that something was wrong, even when things appeared fine. Cultivate what Grove called “only the paranoid survive.” Ask hard questions. Question glowing reports.
3. Bring in external advisors
External advisors play a crucial role. They have no political capital at stake, no agenda and no family dynamics to navigate. Their job isn’t to please you— it’s to serve you the truth.
Great external advisors:
- Provide unfiltered, objective insights,
- Are guided by facts, data and pattern recognition,
- Help you interpret organizational “blind spots,” and
- Bring experiences from other family businesses or industries so you’re not trapped in your own echo chamber.
Most importantly, they tell you what others won’t.
Tom Oliver, a “global management guru” (Bloomberg), is the chair of The Tom Oliver Group, the trusted advisor and counselor to many of the world’s most influential family businesses, medium-sized enterprises, market leaders and global conglomerates. For more information and inquiries: www.TomOliverGroup.com or email Tom.Oliver@inquirer.com.ph.
