LSE Business Review

Collective Discernment Is the Missing Line on the Corporate Balance Sheet

Collective discernment is the board’s shared ability to surface weak signals, integrate dissent, and act decisively under pressure. Recent collapses at Silicon Valley Bank and Wirecard show that even with ample data, a lack of collective judgment can precipitate failure. The authors argue this capability should be treated as an intangible asset and measured alongside traditional controls. They propose institutionalising productive dissent, premortem exercises, and a few simple indicators to embed discernment into governance routines.